EXHIBIT B
EXECUTION COPY
IRREVOCABLE PROXY AGREEMENT
PROXY AGREEMENT (this "Agreement"), dated as of July 3, 2001,
by and among Sun International Hotels Limited, a company incorporated under the
laws of The Bahamas (the "Company"), Sun International Investments Limited, a
company incorporated under the laws of the British Virgin Islands ("SIIL"),
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 ("Kersaf"),
Caledonia Investments PLC, a company incorporated under the laws of England
("Caledonia"), Mangalitsa Limited, a company incorporated under the laws of The
Bahamas ("Mangalitsa"), Cement Merchants SA, a company incorporated under the
laws of Panama ("CMS"), Rosegrove Limited, a company incorporated under the laws
of the British Virgin Islands ("Rosegrove"), Royale Resorts Holdings Limited, a
company incorporated under the laws of Bermuda ("RRHL"), and Sun International
Inc., a company incorporated under the laws of Panama ("SINC").
WHEREAS, contemporaneously herewith, the parties hereto, among
others, have entered into a Registration Rights and Governance Agreement (the
"Governance Agreement");
WHEREAS, the Governance Agreement provides, among other
things, that the parties to this Agreement listed on Exhibit A hereto as
grantors (each, a "Grantor") has agreed to grant an irrevocable proxy (each, a
"Proxy") to each of the parties to this Agreement listed opposite the name of
such Grantor on Exhibit A (each, a "Grantee").
NOW, THEREFORE, in consideration of the foregoing and the
mutual promises, representations, warranties, covenants and agreements contained
herein and in the Governance Agreement, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have the meanings given to them in the Governance Agreement.
2. Grant. Each Grantor hereby appoints to each Grantee a Proxy to represent
and vote the Proxy Shares (as defined in Section 3) held of record by such
Grantor on the record date for determining the shareholders of the Company
eligible to vote on the matter at issue (the "Record Date"), for and in the
name, place and stead of such Grantor at all regular, special or other meetings
of the Company's shareholders and at any adjournment of such meetings, held
during the time this Agreement is in effect pursuant to Section 4, and to act by
consent in lieu of a meeting, or otherwise, with respect to the Proxy Shares at
all times this Proxy is in effect pursuant to Section 4, in
order that such Proxy Shares be voted the same as those Shares held of record
by each such Grantee.
3. Proxy Shares. The term "Proxy Shares" shall mean with respect to each
Grantee (a) the ordinary shares, par value $0.001 per share, of the Company held
of record by each Grantor as set forth on Exhibit A (including any dividends in
kind thereon) or (b) any other class of stock resulting from any
reclassification, exchange, substitution, combination, stock split or reverse
stock split, including in connection with any merger or otherwise, of such
ordinary shares.
4. Scope and Term. Each Grantor acknowledges and agrees that each Proxy
granted pursuant to this Agreement is irrevocable and is coupled with an
interest. Each Proxy shall be effective as of the date hereof and shall remain
in effect until all of the Proxy Shares subject to this Agreement are sold or
foreclosed upon by the Company pursuant to that certain Stock Pledge Agreement,
dated as of the date hereof (the "Pledge Agreement"), by and among RRHL and the
Company. In addition, this Proxy shall terminate (a) as to any Shares
transferred, including pursuant to the Distribution, in accordance with the
terms of the Governance Agreement and (b) with respect to CMS Shares only, upon
the transfer of such CMS Shares to any member of the CMS Group pursuant to the
CMS Option, the CMS RRHL Acquisition or otherwise.
5. Transfers. If any portion of the Proxy Shares held by the applicable
Grantor is hypothecated, pledged, encumbered or has a security interest granted
therein (other than under and pursuant to the Pledge Agreement), the transferee
of such Shares shall be bound by this Proxy (and shall execute a new proxy in
the form of Exhibit B hereto). In the event of any transfer (as defined in the
Governance Agreement) of all or any portion of the Proxy Shares which is not
permitted to be made pursuant to the Governance Agreement, this Proxy shall
remain in full force and effect and such purported transfer shall be void ab
inito in accordance with Section 4.1 of the Governance Agreement.
6. Legend. (a) For so long as any Proxy is effective, the Company agrees
to affix to each certificate representing Proxy Shares, the following legend:
NOTICE: THE POWER TO VOTE THE SHARES REPRESENTED BY THIS SHARE
CERTIFICATE IS SUBJECT TO A PROXY WHICH IS IRREVOCABLE.
(b) The Company shall remove such legend upon the sale of any such Proxy
Shares in accordance with the terms and conditions set forth in the Governance
Agreement.
7. Representations and Warranties of the Grantor. Each Grantor hereby
represents and warrants jointly but not severally to each Grantee, as follows:
(a) Existence. Each Grantor has been duly organized and is validly
existing and in good standing under the laws of the jurisdiction of its
organization.
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(b) Power and Authority. Each Grantor has all necessary power and
authority to enter into this Agreement, to perform its obligations hereunder and
to consummate the Proxies contemplated hereby, and the execution, delivery and
performance of this Agreement by such Grantor and the consummation by such
Grantor of the matters contemplated hereby have been duly authorized by all
necessary action on the part of such Grantor, and no other proceeding on the
part of such Grantor is necessary to authorize the execution, delivery or
performance of this Agreement. Each Proxy has been duly and validly executed and
delivered by each Grantor and, assuming the valid authorization, execution and
delivery of this Proxy by the applicable Grantee, constitutes a legal, valid and
binding obligation of the Grantor, enforceable against such Grantor in
accordance with its terms.
(c) No Conflict. None of the execution and delivery of this Agreement by
each Grantor, the consummation by such Grantor of the Proxy contemplated hereby
or compliance by such Grantor with any of the provisions hereof shall (i)
conflict with or violate the Charter Documents of such Grantor, (ii) result in a
violation or breach of, or constitute (with or without notice or lapse of time
or both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the terms,
conditions or provisions of any note, loan agreement, bond, mortgage, indenture,
license, contract, commitment, lease, permit, franchise, arrangement,
understanding, agreement or other instrument or obligation of any kind to which
such Grantor is a party or by which such Grantor or any of his or its properties
or assets (including the Proxy Shares) may be bound, or (iii) violate any order,
writ, injunction, decree, judgment, law, statute, rule, regulation or
administrative or arbitral order applicable to such Grantor or any of its
properties or assets.
(d) Title to the Owned Shares. Each Grantor is the holder of record of the
Proxy Shares set forth opposite its name on Exhibit A. Such Proxy Shares (and
with respect to any member of a Group, the Proxy Shares set forth opposite the
names of the members of such Group on Exhibit A) are all the securities of the
Company either Beneficially Owned or owned of record by such Grantor as of the
date hereof and the Grantor owns no other Equity Securities. Except to the
extent set forth in the Pledge Agreement, (i) such Proxy Shares are owned free
and clear of all security interests, liens, claims, pledges, options, rights of
first refusal, agreements, limitations on such Grantor's voting rights, charges
and other encumbrances of any nature whatsoever and (ii) such Grantor has not
appointed or granted any proxy, which appointment or grant is still effective,
with respect to the Proxy Shares.
8. Covenants.
(a) No Inconsistent Agreements. Each Grantor hereby covenants and agrees
that, except as contemplated by this Agreement and the Pledge Agreement, it
shall not enter into any agreement, arrangement or understanding (including,
without limitation, any voting agreement) with, or grant a proxy or power of
attorney to, any Person (other than the Grantees) with respect to the Proxy
Shares.
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(b) Reduction. Each Grantor and Grantee covenants and agrees that, upon
consummation of a sale by any Grantor of any Proxy Shares, (i) in the case of a
sale of Proxy Shares other that those in respect of which a Proxy has been
granted to CMS, the number of Proxy Shares subject to any Proxy shall be reduced
so as to maintain the pro rata share of each Grantee as set forth on Exhibit A
and (ii) in the case of a sale of Shares in respect of which a Proxy has been
granted to CMS, only the number of Shares subject to the Proxy granted to CMS
shall be reduced and the pro rata share of each Grantee as set forth on Exhibit
A shall be adjusted accordingly.
(c) Permitted Transfers. In the event of any transfer by any Grantor to
any such Grantor's Affiliated Transferees, such Grantor shall cause such
Affiliated Transferee to become a party to this Agreement and such Shares shall
remain subject to any Proxy granted hereunder.
9. Amendments; No Waivers.
(a) No provision of this Agreement may be amended or waived unless such
amendment or waiver is in writing and signed by each of the Company, WLG,
Kersaf, Caledonia and CMS, and, in the case of a waiver, by the party against
whom the waiver is to be effective; provided that no such amendment or waiver
shall be effective against the Company without the prior approval of a majority
of the Company's Independent Directors.
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
10. Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors. Except as expressly provided herein, no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement.
11. Governing Law. This Agreement shall be construed in accordance with
and governed by the laws of The Bahamas applicable to agreements made and to be
performed entirely therein.
12. JURISDICTION.
(a) ANY ACTION OR PROCEEDING AGAINST EITHER OF THE PARTIES HERETO RELATING
IN ANY WAY TO THIS AGREEMENT MAY BE BROUGHT OR ENFORCED IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK,
IN EACH CASE, LOCATED IN NEW YORK, NEW YORK, AND EACH OF THE PARTIES HERETO
IRREVOCABLY CONSENTS, AND SHALL CAUSE EACH OF ITS AFFILITAES TO IRREVOCABLEY
CONSENT, TO THE JURISDICTION OF EACH SUCH COURT IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING.
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EACH OF THE PARTIES HERETO FURTHER IRREVOCABLY CONSENTS, AND SHALL CAUSE EACH OF
ITS AFFILIATES TO IRREVOCABLY CONSENT, TO THE SERVICE OF PROCESS IN ANY SUCH
ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED
MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, TO SUCH PARTY AT ITS ADDRESS AS
PROVIDED FOR NOTICES HEREUNDER. THE FOREGOING SHALL NOT LIMIT THE RIGHT OF ANY
OF THE PARTIES HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO BRING ANY ACTION OR PROCEEDING, OR TO OBTAIN EXECUTION OF ANY JUDGMENT, IN
ANY OTHER JURISDICTION.
(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, AND SHALL CAUSE
EACH OF ITS AFFILIATES TO IRREVOCABLY WAIVE, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING UNDER
OR RELATING TO THIS AGREEMENT IN ANY COURT LOCATED IN NEW YORK, NEW YORK, AND
HEREBY FURTHER IRREVOCABLY WAIVES, AND SHALL CAUSE EACH OF ITS AFFILITAES TO
IRREVOCABLY WAIVE, ANY CLAIM THAT A COURT LOCATED IN NEW YORK, NEW YORK, IS NOT
A CONVENIENT FORUM FOR ANY SUCH ACTION OR PROCEEDING.
13. Counterparts; Effectiveness. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signature thereto and hereto were upon the same instrument. This
Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by the other party hereto.
14. Specific Performance. The parties hereto (and any Person who agrees to
be bound hereby pursuant to the terms hereof) acknowledge and agree, and shall
cause each of its Affiliates to agree, that their respective remedies at law for
a breach or threatened breach of any of the provisions of this Agreement would
be inadequate and, in recognition of that fact, agree that, in the event of a
breach or threatened breach by any party (or any of such Persons) of the
provisions of this Agreement, in addition to any remedies at law, they shall,
respectively, without posting any bond, be entitled to obtain equitable relief
in the form of specific performance, a temporary restraining order, a temporary
or permanent injunction or any other equitable remedy which may then be
available.
15. Severability. If any provision of this Agreement or the application of
any provision hereof to any party hereto or set of circumstances is held
invalid, the remainder of this Agreement and the application of such provision
to the other parties hereto or sets of circumstances shall not be affected,
unless the provisions held invalid shall substantially impair the benefits of
the remaining portions of this Agreement.
[Signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
SUN INTERNATIONAL HOTELS LIMITED
By:
-------------------------------------
Name:
Title:
SUN INTERNATIONAL INVESTMENTS LIMITED
By:
-------------------------------------
Name:
Title:
WORLD LEISURE GROUP LIMITED
By:
-------------------------------------
Name:
Title:
KERSAF INVESTMENTS LIMITED
By:
-------------------------------------
Name:
Title:
CALEDONIA INVESTMENTS PLC
By:
-------------------------------------
Name:
Title:
MANGALITSA LIMITED
By:
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Name:
Title:
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CEMENT MERCHANTS SA
By:
-------------------------------------
Name:
Title:
ROSEGROVE LIMITED
By:
-------------------------------------
Name:
Title:
ROYALE RESORTS HOLDINGS LIMITED
By:
-------------------------------------
Name:
Title:
SUN INTERNATIONAL INC.
By:
-------------------------------------
Name:
Title:
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EXHIBIT A
Grantors Grantees No. of Proxy Shares Pro Rata Share
-------- -------- ------------------- --------------
SIIL WLG 6,143,501.6 34.8%
Mangalitsa 6,143,501.6 34.8%
CMS 1,200,376.8 6.8%
Rosegrove Mangalitsa 1,793,531.0 10.1%
WLG 481,031.0 2.7%
CMS 350,437.0 2.0%
Sun International Inc. Mangalitsa 550,000.0 3.1%
WLG 550,000.0 3.1%
Royale Resorts Holdings Limited CMS 136,170.0 0.8%
WLG 186,915.0 1.0%
Mangalitsa 186,915.0 1.0%
