Exhibit 10.4


 


ORIENT-EXPRESS HOTELS LTD.


 


2007 Stock Appreciation Rights Plan


(as adopted by the Board of Directors on December 3,
2007 and amended on September 8, 2008 and September 11, 2009)


 


1.                                      The Plan


 


Orient-Express
Hotels Ltd. (“OEH”) may grant stock appreciation rights (“SARs”) with respect
to Class A common shares of OEH pursuant to this 2007 Stock Appreciation
Rights Plan (the “Plan”) to permanent and seasonal full-time employees working
at least 35 hours per week and permanent and seasonal part-time employees
working less that 35 hours per week (“Employees”) of OEH, any of its
subsidiaries or affiliates and any of its investees that have adopted the Plan
(each, a “Participating Company”).  In
general, an SAR will entitle the Employee to whom an SAR has been granted to
receive a cash payment related to the increase (if any) in the market value of
OEH’s Class A common shares over three (3) years.


 


2.                                      Administration of the Plan


 


The
Compensation Committee (the “Committee”) of the Board of Directors of OEH will
administer the Plan and the SARs granted under it.  Any decision of the Committee will be final
and conclusive in all matters relating to the Plan and the SARs.  The Committee may make or vary regulations
for the administration and operation of the Plan not inconsistent with its
provisions.  The Committee may authorize
any one or more Committee members or the Secretary of OEH to execute and
deliver documents on behalf of the Committee. 
If the Committee is not constituted, references to it in the Plan will
be deemed to refer to the Board of Directors of OEH.


 


3.                                      To Whom SARs May Be
Granted


 


SARs may be
granted by the Committee to any eligible Employee of a Participating
Company.  The Committee is authorized to
determine which of the eligible Employees are to be granted SARs, the dates of
grant, and the number of SARs to be granted to each.  Awards to full-time Employees may be at a
higher number of SARs than to part-time Employees.  A list of Employees to whom SARs have been
granted as of each grant date will be prepared and submitted to the Secretary
of OEH on behalf of the Committee.  An
SAR award certificate in a form approved by the Committee will be issued to
each Employee to


 


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whom an SAR
has been granted specifying the grant date, the fair market value of OEH’s Class A
common shares on the grant date, and the number of SARs granted to the
Employee.


 


4.                                      Maturity and Payment of SARs


 


An outstanding
SAR will mature on the third (3rd) anniversary of its grant date.  Promptly following the maturity date (but no
later than 75 days after the Participating Company’s tax year), a Participating
Company will cause to be paid to each Employee holding a matured SAR who has
been employed by the Participating Company continuously from the SAR grant date
through the SAR maturity date an amount in cash equal to:


 


(a) the
excess (if any) of the fair market value of one OEH Class A common share
at the SAR maturity date over the fair market value of one OEH Class A common
share at the SAR grant date,


 


(b) multiplied
by the number of shares with respect to which the SAR was granted.


 


For purposes
of the Plan, the fair market value of the Class A common shares will be
the last sale price per share on the New York Stock Exchange on the relevant
date (or, if not listed on that exchange, then the last sale price per share on
the principal exchange or market on which the shares are traded).  Payment to an Employee by a Participating Company
will be made through its ordinary payroll including deduction of applicable
taxes.  The Plan will be unfunded, and no
Participating Company will be required to segregate assets in connection with
the Plan.


 


If a
Participating Company and/or substantially all of its assets are disposed of by
OEH prior to the third anniversary of the grant date of outstanding SARs held
by Employees of the Participating Company, then the maturity date of those SARs
shall be the date of disposal of the Participating Company or its assets.


 


5.                                      SARs Not Assignable


 


No SAR granted
under the Plan may be transferred by the Employee.  Upon maturity of an SAR, payment will be made
only to the Employee.


 


6.                                      Adjustment of Number or Kind
of Shares


 


If there is a
stock split, stock dividend, stock combination, exchange of shares or similar
capital adjustment involving the Class A common shares of OEH, the
Committee will appropriately adjust the number and kind of shares with respect
to which SARs have been granted, including the SAR grant prices.


 


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7.                                      Amendment


 


The Plan may
be amended from time to time by the Board of Directors of OEH.  No amendment will alter or impair the rights
or obligations of any Employee, without his consent, under any SAR granted
under the Plan that has not yet matured.


 


8.                                      Termination


 


The Plan will
terminate upon the first of the following dates or events to occur:


 


(a) if
OEH is a participant in any corporate amalgamation, merger, consolidation or
other reorganization and no provision is made at the time of the transaction to
continue the Plan,


 


(b) by
resolution of the Board of Directors of OEH terminating the Plan, or


 


(c) on December 3,
2017.


 


In the event
of termination of the Plan in any of the foregoing ways, the provisions of the
Plan will continue to apply to any SARs granted prior to the termination that
have not yet matured.


 


9.                                      Effect of SARs Upon Employment


 


Nothing in the
Plan will be construed as giving any Employee of a Participating Company the
right to be retained in employment. If a Participating Company dismisses any
Employee, the Participating Company will have no liability for the effect which
dismissal might have upon the Employee as a participant under the Plan.  Under no circumstances will a dismissed
Employee be entitled to claim against the Participating Company any
compensation relating to any SAR held by the Employee under the Plan that has
not yet matured.


 


10.                               Construction


 


In all
respects the Plan will be governed by, and be construed in accordance with, the
laws of the Islands of Bermuda.


 


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