**EXHIBIT 4.22**

 

KERZNER INTERNATIONALLIMITED2005 STOCK INCENTIVE PLAN

 

# SECTION 1.  Adoptionand Purpose.  The Company hereby adopts this Plan providing forthe granting of Incentive Stock Options, Nonqualified Stock Options, RestrictedShares and Other Stock-Based Awards to directors, officers, employees andconsultants of the Company and its Subsidiaries (including prospectivedirectors, officers, employees and consultants). The general purpose of thePlan is to promote the interests of the Company and its Subsidiaries byproviding to their directors, officers, employees and consultants incentives tocontinue and increase their efforts with respect to, and remain in the employof, the Company and its Subsidiaries.

#  

# SECTION 2.  Administration.  (a)  ThePlan will be administered by the Committee, which shall be composed of two ormore persons. The Committee shall hold meetings at such times and places as itmay determine. Acts approved at a meeting by a majority of the members of theCommittee or acts approved in writing by the unanimous consent of the membersof the Committee shall be the valid acts of the Committee. To the extentrequired for any transactions under the Plan to qualify for any availableexemptions under Rule 16b-3 promulgated under the Exchange Act, allactions relating to Awards to persons subject to Section 16 of theExchange Act may be taken by the Board or a committee or subcommittee of theBoard composed of two or more persons, each of whom shall qualify as a “non-employeedirector” within the meaning of Rule 16b-3.

#  

## (b)  Subjectto the express provisions of the Plan, the Committee shall have plenaryauthority, in its discretion, to administer the Plan and to exercise all powersand authority either specifically granted to it under the Plan or necessary andadvisable in the administration of the Plan, including, without limitation, theauthority to (i) interpret, and reconcile any inconsistency and/or correctany default and/or supply any omission in, the Plan, (ii) prescribe,amend, suspend, waive and rescind rules and regulations relating to the Plan,(iii) appoint such agents as it shall deem desirable for the properadministration of the Plan, (iv) determine the terms and conditions of allAwards granted under the Plan (which need not be identical), the purchase price(if applicable) of the shares covered by each Award, the individuals to whomand the time or times at which Awards shall be granted, when an Award can beexercised and whether in whole or in installments, (v) determine thenumber of shares to be covered by, or with respect to which payments, rights orother matters are to be calculated in connection with, each Award,(vi) determine whether, to what extent and under what circumstances eachAward may be settled or exercised in cash, shares, other securities, otherAwards or other property, or canceled, forfeited or suspended and the method ormethods by which Awards may be settled, exercised, canceled, forfeited orsuspended, (vii) determine whether, to what extent and under whatcircumstances cash, shares, other securities, other Awards, other property andother amounts payable with respect to an Award shall be deferred eitherautomatically or at the election of the holder thereof or the Committee,

 

----

 

## (viii) amend an outstanding Award or grant a replacement Award foran Award previously granted under the Plan if, in its sole discretion, theCommittee determines that (A) the tax consequences of such Award to theCompany or the participant differ from those consequences that were expected tooccur on the date the Award was granted or (B) clarifications orinterpretations of, or changes to, tax law or regulations permit Awards to begranted that have more favorable tax consequences than initially anticipatedand (ix) make all other determinations and take all other actions that theCommittee deems necessary or desirable with respect to the Plan.

##  

## (c)  Unlessotherwise expressly provided in the Plan, all designations, determinations,interpretations and other decisions under or with respect to the Plan or anyAward shall be in the sole discretion of the Committee, may be made at any timeand shall be final, conclusive and binding upon all Persons, including theCompany, any of its Affiliates, any participant, any holder or beneficiary ofany Award and any shareholder.

##  

## (d)  TheCommittee may delegate, on such terms and conditions as it determines in itssole discretion, to one or more senior officers of the Company the authority tomake grants of Awards to officers, employees and consultants of the Company andits Subsidiaries (including any prospective officer, employee or consultant).

##  

## (e)  Determinationsunder the Plan made by the Board or the Committee, including, withoutlimitation, determinations as to the persons to receive Awards, the terms andprovisions of such Awards and the agreements evidencing the same, need not beuniform and may be made selectively among persons who receive or are eligibleto receive Awards under the Plan, whether or not such persons are similarlysituated.

##  

# SECTION 3.  Participants.  TheCommittee shall from time to time select the directors, officers, employees andconsultants of the Company and its Subsidiaries (including any prospectivedirector, officer, employee or consultant) to whom Awards are to be granted,and who will, upon such grant, become participants in the Plan. The term “participant”as used in this Plan shall refer to those directors, officers, employees andconsultants granted Awards by the Committee and to any person or entity towhich such Awards are transferred or assigned pursuant to Section 16hereof.

#  

# SECTION 4.  SharesSubject to Plan.  Subject to adjustment as provided inSection 14, the aggregate number of Ordinary Shares that may be deliveredpursuant to Awards granted under the Plan is 2,000,000, all of which may bedelivered pursuant to Incentive Stock Options granted under the Plan. OrdinaryShares to be awarded may be made available from either authorized but unissuedOrdinary Shares or Ordinary Shares held by the Company in its treasury. If anyAward is forfeited or otherwise terminated or is canceled without the deliveryof Ordinary Shares, Ordinary Shares are surrendered or withheld from any Awardto satisfy a participant’s income tax or other withholding obligations, orOrdinary Shares owned by a participant are tendered to pay the exercise priceof any Award granted under the Plan, then the Ordinary Shares covered by suchforfeited, terminated or canceled Award or which are equal to the number ofOrdinary

 

2

----

 

# Shares surrendered, withheld or tendered shall again become availablefor issuance or delivery pursuant to Awards granted or to be granted under thePlan; provided, however, that in no event shall such OrdinaryShares increase the number of Ordinary Shares that may be delivered pursuant toIncentive Stock Options granted under the Plan.

#  

# SECTION 5.  Grantof Options.  All Options under the Plan shall be granted by theCommittee. The Committee shall determine the number of Ordinary Shares to beoffered from time to time by grant of Options to participants of the Plan. Morethan one Option may be granted to the same participant. The grant of an Optionto a participant shall not be deemed either to entitle the participant to, orto disqualify the participant from, participation in any other grant of Optionsor other Awards under the Plan. The grant of Options shall be evidenced bystock option agreements as may be prescribed by the Committee from time totime, containing such terms, provisions and rules, including, withoutlimitation, the number of Ordinary Shares underlying such Options and theexercise price thereof, as are approved by the Board, but not inconsistent withthe Plan. In the case of Incentive Stock Options, the terms and conditions ofsuch grants shall be subject to and comply with such rules as may be prescribedby Section 422 of the Code and any regulations related thereto, as may beamended from time to time. All Options granted under the Plan shall beNonqualified Stock Options unless the applicable stock option agreementexpressly states that the Option is intended to be an Incentive Stock Option. Ifan Option is intended to be an Incentive Stock Option, and if for any reasonsuch Option (or any portion thereof) shall not qualify as an Incentive StockOption, then, to the extent of such failure to so qualify, such Option (orportion thereof) shall be regarded as a Nonqualified Stock Option appropriatelygranted under the Plan; provided that such Option (or portion thereof)otherwise complies with the Plan’s requirements relating to Nonqualified StockOptions. The Company shall execute stock option agreements upon instructionsfrom the Committee.

#  

# SECTION 6.  OptionPrice.  The exercise price per Ordinary Share under each Optionshall be equal to 100% of the Fair Market Value per Ordinary Share on the datethe Option is granted; provided, however, that no more than fivepercent of the Ordinary Shares that may be delivered pursuant to Awards grantedunder the Plan may be delivered pursuant to Nonqualified Stock Options thathave an exercise price per Ordinary Share equal to less than 100% of the FairMarket Value per Ordinary Share on the date the Nonqualified Stock Option isgranted; provided further, that in the case of an Incentive Stock Optiongranted to an employee who, at the time of the grant of such Option, owns stockrepresenting more than 10% of the voting power of all classes of stock of theCompany or any Affiliate, the exercise price per Ordinary Share shall be noless than 110% of the Fair Market Value per Ordinary Share on the date of thegrant.

#  

# SECTION 7.  Exercisabilityof Options.  Unless otherwise specifically provided by theCommittee in the applicable stock option agreement, an Option may not beexercised later than the earlier of (a) the day prior to the seventhanniversary of the date the Option is granted or, in the case of an IncentiveStock Option granted to an employee who, at the time of the grant of suchOption, owns stock representing more than 10% of the voting power of allclasses of stock of the Company or any Affiliate, the day

 

3

----

 

# prior to the fifth anniversary of the date the Option is granted, and(b) the expiration of the time period set forth in Section 11 withrespect to a participant that ceases to be a director, officer, employee orconsultant of the Company and its Subsidiaries. Each Option shall be vested andexercisable at such times, in such manner and subject to such terms andconditions as the Committee may, in its sole discretion, specify in theapplicable stock option agreement or thereafter. Except as otherwise specifiedby the Committee in the applicable stock option agreement, an Option may onlybe exercised to the extent that it has already vested at the time of exercise. Notwithstandingany provision of the Plan to the contrary and except as specifically providedin Section 11(b) or Section 12, an Option shall not become vested andexercisable with respect to all Ordinary Shares covered thereby over a periodthat is shorter than three years; provided that an Option that issubject to performance-based vesting criteria may become vested and exercisablewith respect to all Ordinary Shares covered thereby over a period that is notshorter than one year. Unless otherwise provided in the applicable stock optionagreement, Options shall become vested and exercisable in accordance with thefollowing schedule:

 

| **Vesting  Dates  (Anniversaries of Grant Date)** | ** ** | **Aggregate Percentage of  Ordinary Shares Vested and  Exercisable** | ** ** |
|---------------------------------------------------|------------|----------------------------------------------------------------------|------------|
| First                                             |       | 25                                                                   | %          |
| Second                                            |       | 50                                                                   | %          |
| Third                                             |       | 75                                                                   | %          |
| Fourth                                            |       | 100                                                                  | %          |

 

# SECTION 8.  Payment;Method of Exercise; Disposition.  (a)  Payment upon theexercise of Options shall be made in cash or by such other method as theCommittee may from time to time prescribe, including without limitation bypayment of Ordinary Shares already owned for a period of at least six monthsand one day by the holder of the Option or a note issued to the Company by suchparticipant or pursuant to a “cashless exercise”, in each case if permitted bythe Committee and applicable law. No Ordinary Shares may be issued uponexercise of an Option until payment of the exercise price therefor has beenmade, and a participant will have none of the rights of a shareholder of theCompany until such Ordinary Shares are issued to such participant. Except asotherwise provided in the Plan or in a stock option agreement, no Option may beexercised at any time unless the holder thereof is then a director, officer,employee or consultant of the Company or a Subsidiary.

#  

## (b)  AnOption shall be exercised by written notice to the Company. Such notice shallstate that the holder of the Option elects to exercise the Option, the numberof Ordinary Shares in respect of which it is being exercised, the per shareexercise price thereof and the manner of payment for such Ordinary Shares andshall either (i) be accompanied by payment of the full purchase price ofsuch Ordinary Shares or (ii) in the

 

4

----

 

## case of any individual who is not subject to Section 402 of theSarbanes-Oxley Act of 2002, fix a date (not more than ten business daysfrom the date of exercise) for the payment of the full purchase price of suchOrdinary Shares. Cash payments shall be made by cash or check payable to theorder of the Company. Ordinary Share payments (valued at Fair Market Value onthe date of exercise) shall be made by delivery of stock certificates innegotiable form, free from all liens, claims and encumbrances. Any OrdinaryShare payments shall be made using Ordinary Shares that have been held by theholder of the Option for a period of at least six months and one day. Ifcertificates representing Ordinary Shares are used to pay all or part of theexercise price of an Option, a separate certificate shall be delivered by theCompany representing the same number of Ordinary Shares as each certificate soused, and an additional certificate shall be delivered representing theadditional Ordinary Shares to which the holder of the Option is entitled as aresult of the exercise of the Option. Ordinary Share certificates shall beissued as soon as practicable following the date of exercise of an Option.

##  

## (c)  Ifany participant shall make any disposition of Ordinary Shares deliveredpursuant to the exercise of an Incentive Stock Option under the circumstancesdescribed in Section 421(b) of the Code (relating to certain disqualifyingdispositions) or any successor provision of the Code, such participant shallnotify the Company of such disposition within ten days of such disposition.

##  

# SECTION 9.  RestrictedShares.  (a)  The Committee shall determine anyrestrictions, terms and conditions applicable to the Restricted Shares,including, withoutlimitation, the applicable vesting schedule and the price, if any, to bepaid by the participant for the Restricted Shares; provided that theissuance of Restricted Shares shall be made for at least the minimumconsideration necessary to permit such Restricted Shares to be deemed fullypaid and nonassessable. Each Award shall be evidenced by a restricted stockagreement which may contain such terms as the Committee from time to time shallapprove provided that such terms are not inconsistent with the provisions ofthe Plan. All determinations made by the Committee pursuant to thisSection 9 shall be specified in the restricted stock agreement. Eachgrantee of Restricted Shares shall be notified promptly of such grant and awritten restricted stock agreement shall be promptly executed and delivered bythe Company and the grantee; provided that such grant of RestrictedShares shall terminate if such written restricted stock agreement is not signedby such grantee (or his or her attorney or representative) and delivered to theCompany within 60 days after the effective date of such grant.

#  

## (b)  RestrictedShares subject to Awards shall be issued at the beginning of the period duringwhich the restrictions are in effect (the “Restriction Period”). RestrictedShares shall constitute issued and outstanding Ordinary Shares for allcorporate purposes. Unless otherwise specifically provided in the Plan and theapplicable restricted stock agreement, the participant will have the right toexercise all rights, powers and privileges of a holder of Ordinary Shares withrespect to such Restricted Shares, except that, unless otherwise provided bythe Committee, (i) the participant will not be entitled to delivery of thecertificate or certificates representing such Restricted Shares until the endof the Restriction Period and unless all other vesting requirements withrespect

 

5

----

 

## thereto shall have been fulfilled or waived; (ii) other thanregular cash dividends and such other distributions as the Board may in itssole discretion designate, the Company will retain custody of all distributions(“Retained Distributions”) made or declared with respect to theRestricted Shares, if any (and such Retained Distributions will be subject tothe same restrictions, terms and vesting and other conditions as are applicableto the Restricted Shares), until such time, if ever, as the Restricted Shareswith respect to which such Retained Distributions shall have been made, paid ordeclared shall have become vested, and such Retained Distributions shall notbear interest or be segregated in a separate account; (iii) subject toSection 16, the participant may not sell, assign, transfer, pledge,exchange, encumber or dispose of the Restricted Shares or any RetainedDistributions or his or her interest in any of them during the RestrictionPeriod; and (iv) a breach of any restrictions, terms or conditionsprovided in the Plan or established by the Committee with respect to anyRestricted Shares or Retained Distributions will cause a forfeiture to theCompany of such Restricted Shares and Retained Distributions.

##  

## (c)  Thecertificate or certificates representing such Restricted Shares shall beregistered in the name of the participant to whom such Restricted Shares shallhave been awarded. During the Restriction Period, certificates representing theRestricted Shares and any securities constituting Retained Distributions shallbear a restrictive legend to the effect that ownership of the Restricted Shares(and such Retained Distributions), and the enjoyment of all rights appurtenantthereto, are subject to the restrictions, terms and conditions provided in thePlan and the applicable restricted stock agreement. Such certificates shallremain in the custody of the Company and the participant shall, as a conditionto receiving an Award of Restricted Shares, deposit with the Company stockpowers or other instruments of assignment, endorsed in blank, so as to permitretransfer to the Company of all or any portion of such Restricted Shares andany Retained Distributions that shall not become vested in accordance with thePlan and the applicable restricted stock agreement.

##  

## (d)  Subjectto Section 11, at the end of the Restriction Period, (i) theRestricted Shares shall become vested and (ii) any Retained Distributionswith respect to such Restricted Shares shall become vested to the extent thatthe Restricted Shares related thereto shall have become vested, each inaccordance with the terms and conditions of the Plan and the applicablerestricted stock agreement. Any such Restricted Shares and RetainedDistributions that do not become vested shall be forfeited to the Company andthe participant shall not thereafter have any rights with respect to suchRestricted Shares and Retained Distributions that shall have been so forfeited.

 

6

----

 

## (e)  Notwithstandingany provision of the Plan to the contrary and except as provided inSection 11(i) or Section 12, no grant of Restricted Shares shallbecome vested with respect to all Restricted Shares subject to such grant overa period that is shorter than three years; provided that RestrictedShares that are subject to performance-based vesting criteria, may becomevested with respect to all Restricted Shares covered by a particular grant overa period that is not shorter than one year. Unless otherwise provided in theapplicable restricted stock agreement, a grant of Restricted Shares shallbecome vested in accordance with the following schedule:

 

| **Vesting  Dates  (Anniversaries of Grant Date)** | ** ** | **Aggregate Percentage of  Restricted Shares Vested** | ** ** |
|---------------------------------------------------|------------|-------------------------------------------------------|------------|
| Second                                            |       | 33                                                    | %          |
| Third                                             |       | 66                                                    | %          |
| Fourth                                            |       | 100                                                   | %          |

 

## (f)  Noelection under Section 83(b) of the Code (to include in gross income inthe year of transfer the amounts specified in Section 83(b) of the Code)or under a similar provision of law may be made with respect to a RestrictedShare unless expressly permitted by the terms of the applicable restrictedstock agreement or by action of the Committee in writing prior to the making ofsuch election. If a participant, in connection with the acquisition ofRestricted Shares under the Plan or otherwise, is expressly permitted under theterms of the applicable restricted stock agreement or by such Committee actionto make such an election and the participant makes the election, theparticipant shall notify the Company of such election in accordance withSection 25 within ten days of filing notice of the election with theUnited States Internal Revenue Service or other governmental authority, inaddition to any filing and notification required pursuant to regulations issuedunder Section 83(b) of the Code or any other applicable provision.

##  

# SECTION 10.  OtherStock-Based Awards.  (a)  The Committee may grant othertypes of equity-based or equity-related Awards (including, without limitation,the grant or offer for sale of unrestricted Ordinary Shares and the grant ofrestricted stock units and stock appreciation rights) as deemed by theCommittee to be consistent with the purposes of the Plan. Each OtherStock-Based Award shall be evidenced by a written Award agreement which maycontain such terms as the Committee from time to time shall approve providedthat such terms are not inconsistent with the provisions of the Plan. Such Awardsmay include, without limitation, the transfer of actual Ordinary Shares toparticipants or payment in cash or otherwise of amounts based on the value ofOrdinary Shares, and Awards designed to comply with or take advantage of theapplicable local laws of jurisdictions other than the United States.

#  

## (b)  Ifand to the extent that Ordinary Shares are to be issued to a participant uponthe vesting of an Other Stock-Based Award, then, upon vesting of such

 

7

----

 

## Other Stock-Based Award, unless otherwise determined by the Committee,the participant shall be entitled to receive an amount in cash equal to thevalue of the cash dividends and such other distributions as the Board may inits sole discretion designate (“Dividend Equivalents”) with respect tothe Ordinary Shares covered thereby during the period beginning on the date theOther Stock-Based Award is awarded and ending on the date that it vests; provided,however, that unless otherwise provided in the applicable Awardagreement, the foregoing provisions shall not apply to any Exercisable OtherStock-Based Awards.

##  

# SECTION 11.  Terminationof Employment or Service.  (a)  Unless otherwiseprovided by the Committee, if the participant’s employment or service as adirector or consultant terminates prior to the complete exercise of an Option,then the vested portion of such Option shall thereafter be exercisable solelyto the extent provided herein, and any unvested portion of the Option (to theextent the vesting is not accelerated under Section 11(b) orSection 12) shall immediately terminate.

#  

## (b)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates by reason of death, all Options held bythe participant shall become immediately vested and exercisable and shallremain exercisable for a period of one year following such termination, but inno event later than the originally scheduled expiration of such Options.

##  

## (c)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates by reason of Disability, the vestedportion of any Options held by the participant shall remain exercisable for aperiod of one year following such termination, but in no event later than theoriginally scheduled expiration of such Options.

##  

## (d)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates (other than by reason of death, Disabilityor Cause) (i) at or after age 60 or (ii) at or after age 55 with tenyears of service with the Company (“Retirement”), the vested portion ofany Options held by the participant shall remain exercisable for a period oftwo years following such termination, but in no event later than the originallyscheduled expiration of such Options; provided, however, that thevested portion of the Options shall remain exercisable for a period of only90 days following termination of employment (or, if such 90-day period hasexpired, shall be deemed retroactively to have ceased to be exercisable at theend of such 90-day period) if, during the two-year period following theparticipant’s Retirement, the participant, directly orindirectly:  (A) engages in or has any interest in any soleproprietorship, partnership, corporation or business or any other Person orentity (whether as an employee, officer, director, partner, agent, securityholder, creditor, consultant or otherwise) that directly or indirectly (orthrough any affiliated entity) engages in competition with the Company; provided,however, that such provision shall not apply to the acquisition by theparticipant, solely as an investment, of securities of any issuer that isregistered under Section 12(b) or 12(g) of the Exchange Act, and that arelisted or admitted for trading on any United States national securitiesexchange or that are quoted

 

8

----

 

## on the National Association of Securities Dealers Automated QuotationsSystem, or any similar system or automated dissemination of quotations ofsecurities prices in common use, so long as the participant does not control,acquire a controlling interest in or become a member of a group that exercisesdirect or indirect control of, more than five percent of any class of capitalstock of such corporation; or (B) for himself or herself or for any otherperson, firm, corporation, partnership, association or otherentity:  (1) hires or attempts to hire, whether as an employee,consultant or otherwise, any employee or former employee of the Company or anyof its Subsidiaries, unless such employee or former employee has not beenemployed by the Company or any of its Subsidiaries for a period in excess ofsix months; (2) calls on or solicits any of the actual or targetedprospective clients of the Company on behalf of any Person or entity inconnection with any business competitive with the business of the Company; or(3) makes known the names and addresses of such clients or any informationrelating in any manner to the Company’s trade or business relationships withsuch clients. For the avoidance of doubt, if, pursuant to the foregoingprovision, a vested portion of any Option is deemed retroactively to haveceased to be exercisable, and the participant had exercised such Optionsubsequent to the 90-day period, the participant shall pay to the Company, incash, promptly upon demand by the Company, an amount equal to the excess of theFair Market Value of the Shares over the exercise price on the date of suchexercise.

##  

## (e)  Ifthe participant’s employment or service as a director or consultant isterminated by the Company for Cause, then all Options held by such participantshall immediately terminate.

##  

## (f)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates for any reason other than death,Disability, Retirement or Cause, the vested portion of any Options held by theparticipant shall remain exercisable for a period of 90 days followingsuch termination, but in no event later than the originally scheduledexpiration of such Options.

##  

## (g)  Unlessotherwise provided by the Committee, if any participant whose employment orservice as a director or consultant has terminated for a reason other thandeath shall die within the period during which any Options held by theparticipant remain exercisable but prior to the complete exercise of suchOptions, such Options may be exercised at any time within the greater of one yearafter such date of death or the remainder of the period in which theparticipant could have exercised such Options had he or she not died, but in noevent later than the originally scheduled expiration of such Options.

##  

## (h)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant is terminated for any reason other than deathduring the Restriction Period with respect to any Restricted Shares, suchparticipant’s rights to all Restricted Shares and Retained Distributions shallbe forfeited immediately.

 

9

----

 

## (i)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates by reason of death, all RestrictedShares held by the participant and any Retained Distributions that relate tothose Restricted Shares shall become immediately vested and nonforfeitable.

##  

## (j)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant is terminated for any reason other than death, anyoutstanding Other Stock-Based Awards held by the participant (other than anyoutstanding Exercisable Other Stock-Based Awards) and any Dividend Equivalentsthat relate to those Other Stock-Based Awards shall immediately terminate.

##  

## (k)  Unlessotherwise provided by the Committee, if the participant’s employment or serviceas a director or consultant terminates by reason of death, all OtherStock-Based Awards held by the participant (other than any outstandingExercisable Other Stock-Based Awards) and any Dividend Equivalents that relateto those Other Stock-Based Awards shall become immediately vested andnonforfeitable.

##  

## (l)  Unlessotherwise provided by the Committee, the provisions of Sections 11(a)through (g) rather than Sections 11(j) and (k) shall apply,**mutatis mutandis (substitutingExercisable Other Stock-Based Award for Option), to any Other Stock-Based Awardthat provides for the delivery of cash, shares or other securities uponexercise of such Award, rather than immediately upon vesting (each, an “ExercisableOther Stock-Based Award”).

##  

## (m)  TheCommittee may determine whether any given leave of absence constitutes atermination of employment or service. Unless otherwise provided by theCommittee, Awards made under the Plan shall not be affected by any change ofemployment so long as the participant continues to be a director, employee orconsultant of the Company or a Subsidiary.

##  

# SECTION 12.  Accelerationof an Award.  Notwithstanding any provision containedherein, the Committee shall have the discretion at any time to accelerate thevesting and exercisability of an Award granted to a participant pursuant to thePlan. Unless otherwise determined by the Committee or as set forth in an Awardagreement, with respect to all outstanding Awards held by any participant, suchAwards shall become fully vested (and, in the case of Options and ExercisableOther Stock-Based Awards, immediately exercisable), all restrictions on suchAwards shall lapse and all performance criteria applicable to such Awards shallbe deemed satisfied at the maximum level, (a) in the case of a participantwho is an employee of the Company or its Subsidiaries on the date of a Changeof Control, upon the earlier to occur of (i) the expiration of the18-month period immediately following such Change of Control and (ii) aQualifying Termination, provided that such Awards are still outstanding at (andhave not terminated prior to) the relevant time, (b) in the case of aparticipant who is a non-employee director of the Company or its Subsidiarieson the date of a Change of Control, upon the consummation of such Change ofControl and (c) in the case of a participant who is a consultant of theCompany or its Subsidiaries on the date of a Change of Control, upon

 

10

----

 

# the earlier to occur of (i) the expiration of the 18-month periodimmediately following such Change of Control or (ii) the termination ofthe participant’s service with the Company, its Subsidiaries or the SurvivingEntity without Cause, provided that such Awards are still outstanding at (andhave not terminated prior to) the relevant time.

#  

# SECTION 13.  WithholdingTaxes.  In connection with the transfer of Ordinary Shares as aresult of the vesting of an Award or upon any other event that would subjectthe holder of an Award to taxation, the Company shall have the right to requirethe holder to pay an amount in cash or to retain or sell without notice, or todemand surrender of, Ordinary Shares that have a value sufficient to cover anytax, including, without limitation, any United States Federal, state or localincome tax, required by any governmental entity to be withheld or otherwisededucted and paid with respect to such transfer (“Withholding Tax”), andto make payment (or to reimburse itself for payment made) to the appropriatetaxing authority of an amount in cash equal to the amount of such WithholdingTax, remitting any balance to such holder. The holder of an Award shall beentitled to satisfy the obligation to pay any Withholding Tax, in whole or inpart, by providing the Company with funds sufficient to enable the Company topay such Withholding Tax or by having the Company retain Ordinary Sharesotherwise deliverable in respect of such Award, or accept upon delivery thereofOrdinary Shares (other than unvested Restricted Shares) held by the holder forat least six months and one day, that have a value sufficient to cover theamount of such Withholding Tax. Each election by such holder to have OrdinaryShares retained or to deliver Ordinary Shares for this purpose shall be subjectto the following restrictions:  (a) the election must be inwriting and made on or prior to the date that the amount of the Withholding Taxis to be determined; and (b) the election shall be subject to thedisapproval of the Committee. The obligations of the Company under the Planshall be conditional on such payment or arrangements being made to thesatisfaction of the Committee.

#  

# SECTION 14.  Effectof Certain Changes.  (a)  In the event that theCommittee determines that any dividend or other distribution (whether in theform of cash, Ordinary Shares, other securities or other property),recapitalization, stock split, reverse stock split, reorganization, merger,consolidation, split-up, spin-off, combination, repurchase or exchange ofOrdinary Shares or other securities of the Company, issuance of warrants orother rights to purchase Ordinary Shares or other securities of the Company,other similar corporate transaction or event (including, without limitation, aChange of Control), change in applicable rule, ruling, regulation or otherrequirement of any governmental body or securities exchange, accounting principlesor law, or other unusual or nonrecurring event affects the Company, any of itsSubsidiaries, the financial statements of the Company or any of itsSubsidiaries, or Ordinary Shares such that an adjustment is determined by theCommittee in its discretion to be appropriate or desirable, then the Committeemay make any such adjustment, which may include, without limitation,(i) adjusting any or all of (A) the aggregate number of OrdinaryShares or other securities of the Company (or number and kind of othersecurities or property) with respect to which Awards may be granted under thePlan, as provided in Section 4, (B) the number of Ordinary Shares orother securities of the Company (or number and kind of other securities orproperty) subject to outstanding Awards and (C) the exercise

 

11

----

 

# price or base price with respect to any Option or Exercisable OtherStock-Based Award; provided, however, that any fractional sharesresulting from any such adjustment may be eliminated, and/or(ii) canceling outstanding Awards in exchange for a cash payment in anamount equal to the excess, if any, of the Fair Market Value of the number ofOrdinary Shares subject to or underlying such Awards over the aggregateexercise price (or applicable base price), if any, of such Awards (it beingunderstood that, if there is no such excess, then such Awards may be canceledwithout any payment or consideration therefor).

#  

## (b)  Awardsmay, in the discretion of the Committee, be granted under the Plan inassumption of, or in substitution for, outstanding awards previously granted bythe Company or its Subsidiaries or a company acquired by the Company or withwhich the Company combines (or a Subsidiary or parent corporation of suchcompany) in connection with a corporate merger, consolidation, acquisition ofassets or stock, reorganization, liquidation or otherwise (“SubstituteAwards”). The number of Ordinary Shares underlying any Substitute Awardsshall be counted against the aggregate number of Ordinary Shares available forAwards under the Plan; provided, however, that Substitute Awardsissued in connection with the assumption of, or in substitution for,outstanding awards previously granted by an entity that is acquired by theCompany or any of its Affiliates through a corporate merger or acquisition ofassets or stock shall not be counted against the aggregate number of OrdinaryShares available for Awards under the Plan; provided further, however,that Substitute Awards issued in connection with the assumption of, or insubstitution for, outstanding stock options intended to qualify for special taxtreatment under Sections 421 and 422 of the Code that were previously grantedby an entity that is acquired by the Company or any of its Affiliates through acorporate merger or acquisition of assets or stock shall be counted against theaggregate number of Ordinary Shares available for Incentive Stock Options underthe Plan. In the event that a written agreement pursuant to which such acorporate transaction is completed is approved by the Board and such agreementsets forth the terms and conditions of the substitution for or assumption ofoutstanding equity or equity-based awards of the acquired corporation, suchterms and conditions shall be deemed to be the action of the Committeehereunder without any further action by the Committee and the Persons holdingsuch awards shall be deemed to be participants in the Plan; provided, however,that the Committee may, to the extent applicable, take any further action withrespect to such awards as may be necessary in connection with Rule 16b-3under the Exchange Act to qualify such Substitute Awards for the favorabletreatment intended to be afforded by Rule 16b-3 under the Exchange Act.

##  

## (c)  Nothingin the Plan or any Award agreement shall be construed as limiting or preventingthe Company or any of its Affiliates from taking any action with respect to theoperation and conduct of their business that they deem appropriate or in theirbest interests, including, without limitation, any or all adjustments,recapitalizations, reorganizations, exchanges or other changes in the capitalstructure of the Company or any of its Affiliates, any merger or consolidationof the Company or any of its Affiliates, any issuance of Ordinary Shares orother securities or subscription rights thereto, any issuance of bonds,debentures, preferred or prior preference stock ahead of or affecting

 

12

----

 

## the Ordinary Shares or other securities or the rights thereof, anydissolution or liquidation of the Company or any of its Affiliates, any sale ortransfer of all or any part of the assets or business of the Company or any ofits Affiliates, or any other corporate act or proceeding, whether of a similarcharacter or otherwise.

##  

## (d)  Inthe event of a change in the Ordinary Shares of the Company as presentlyconstituted, the shares resulting from any such change shall be deemed to bethe Ordinary Shares within the meaning of the Plan.

##  

## (e)  Tothe extent that the foregoing adjustments relate to stock or securities of theCompany, such adjustment shall be made by the Committee, whose determination inthat respect shall be final, binding and conclusive.

##  

# SECTION 15. NonexclusivePlan.  Neither the adoption of the Plan by the Board nor thesubmission of the Plan to the shareholders of the Company for approval shall beconstrued as creating any limitations on the power of the Board to adopt suchother incentive arrangements as it may deem desirable, including, withoutlimitation, the granting of stock options otherwise than under the Plan, andsuch arrangements may be either generally applicable or applicable only inspecific cases.

#  

# SECTION 16.  Restrictionson Transfers.  Awards may not be transferred other than by willor by the laws of descent and distribution; provided, however,that, subject to the approval of the Committee, Nonqualified Stock Options andRestricted Shares may be transferred or assigned by a participant to (a) atrust with respect to which such participant or a member of his or her familyis a beneficiary or (b) a corporation or other entity with respect towhich the participant holds directly or indirectly more than 50% of theoutstanding common stock or other equity interests. All vesting and forfeitureprovisions shall continue to apply with respect to any Nonqualified StockOptions and Restricted Shares that are transferred in accordance with thisSection 16 to the same extent that such provisions would have been applicablein the absence of any transfer. During a participant’s lifetime, Optionsgranted to a participant may be exercised only by the participant, by his orher guardian or legal representative or by a transferee specified in thisSection 16. Any purported transfer or assignment of an Award inconsistent withthe foregoing restrictions shall cause the Award to terminate.

#  

# SECTION 17.  SecuritiesLaws; Other Laws.  The obligation of the Company to offer, selland deliver shares with respect to Awards granted hereunder and theexercisability of Awards shall be subject to all applicable laws, rules andregulations, including, without limitation, all applicable United StatesFederal and state securities laws, the availability of exemptions from theregistration requirements of such United States Federal and state securitieslaws, and the obtaining of all approvals by governmental authorities as may bedeemed necessary or appropriate by the Committee. In no event shall the Companybe obligated to register shares under United States Federal or state securitieslaws, to comply with the requirements of any exemption from registrationrequirements or to take any other action that may be required in order topermit, or to remove any prohibition or limitation on, the issuance of sharespursuant to

 

13

----

 

# Awards granted hereunder which may be imposed by any applicable law,rule or regulation. Notwithstanding anything to the contrary in the Plan or anyAward agreement, the Committee may revoke any Award if it is contrary to law ormodify any Award to bring it into compliance with any applicable laws orregulations. The Committee may impose such other terms, conditions, andrestrictions upon any Award, including any Award theretofore granted, that theCommittee concludes, in its absolute discretion, are necessary or desirable toensure compliance with any applicable law, regulation or rule. Certificates forOrdinary Shares issued under the Plan may be legended as the Committee shalldeem appropriate.

#  

# SECTION 18.  NoEmployment Rights.  The adoption of this Plan and the grant ofAwards shall not confer upon any participant any right to continued employmentin any capacity with the Company or any of its Subsidiaries.

#  

# SECTION 19.  NoImpact on Benefits.  Awards granted under the Plan shall not betreated as compensation for purposes of calculating an employee’s rights underany employee benefit plan, except to the extent expressly provided in any suchplan.

#  

# SECTION 20.  Severability.  Ifany provision of the Plan or any Award granted hereunder is, becomes or isdeemed to be invalid, illegal or unenforceable in any jurisdiction or as to anyPerson or Award, or would disqualify the Plan or any Award under any law, rule,ruling, regulation or other requirement deemed applicable by the Committee,(a) in the case of a provision that is held to be void or to constitute anunreasonable restriction against the participant, such provision shall not berendered void but shall be deemed to be modified to the minimum extentnecessary to make such provision enforceable for the longest duration and thegreatest scope as such court may determine constitutes a reasonable restrictionunder the circumstances and (b) in the case of any other provision, suchprovision shall be construed or deemed amended to conform to the applicablelaw, rule, ruling, regulation or other requirement or, if it cannot beconstrued or deemed amended without, in the determination of the Committee,materially altering the intent of the Plan or the Award, such provision shallbe stricken as to such jurisdiction, Person or Award and, in any event, theremainder of the Plan and any such Award shall remain in full force and effect.

#  

# SECTION 21.  Indemnification.  Nomember of the Board, the Committee or any employee of the Company or itsSubsidiaries (each such person, a “Covered Person”) shall be liable forany action taken or omitted to be taken or any determination made in good faithwith respect to the Plan or any Award hereunder. Each Covered Person shall beindemnified and held harmless by the Company from and against (a) anyloss, cost, liability or expense (including attorneys’ fees) that may beimposed upon or incurred by such Covered Person in connection with, based uponor arising or resulting from any claim, action, suit or proceeding to whichsuch Covered Person may be a party or in which such Covered Person may beinvolved by reason of any action taken or omitted to be taken under or inconnection with the Plan or any Award and (b) any and all amounts paid bysuch Covered Person, with the Company’s approval, in settlement

 

14

----

 

# thereof, or paid by such Covered Person in satisfaction of any judgmentin any such action, suit or proceeding against such Covered Person; providedthat the Company shall have the right, at its own expense, to assume and defendagainst any such claim, action, suit or proceeding, and, once the Company givesnotice of its intent to assume the defense, the Company shall have sole controlover such defense with counsel of the Company’s choice. The foregoing right ofindemnification shall not be available to a Covered Person to the extent that acourt of competent jurisdiction in a final judgment or other final adjudication,in either case not subject to further appeal, determines that the acts oromissions of such Covered Person giving rise to the indemnification claimresulted from such Covered Person’s bad faith, fraud or willful criminal act oromission or that such right of indemnification is otherwise prohibited by lawor by the Company’s Amended and Restated Articles of Association or Memorandumof Association. The foregoing right of indemnification shall not be exclusiveof any other rights of indemnification to which Covered Persons may be entitledunder the Company’s Amended and Restated Articles of Association or Memorandumof Association, as a matter of law, or otherwise, or any other power that theCompany may have to indemnify such persons or hold them harmless.

#  

# SECTION 22.  IncomeTaxes and Deferred Compensation.  Participantsare solely responsible and liable for the satisfaction of all taxes andpenalties that may arise in connection with Awards (including any taxes arisingunder Section 409A of the Code), and the Company shall not have any obligationto indemnify or otherwise hold any participant harmless from any or all of suchtaxes. The Committee shall have the discretion to organize any deferralprogram, to require deferral election forms, and to grant or to unilaterallymodify any Award in a manner that (a) conforms with the requirements of Section409A of the Code, (b) voids any participant election to the extent it wouldviolate Section 409A of the Code and (c) for any distribution event or electionthat could be expected to violate Section 409A of the Code, make thedistribution only upon the earliest of the first to occur of a “permissibledistribution event” within the meaning of Section 409A of the Code, or adistribution event that the participant elects in accordance with Section 409Aof the Code. The Committee shall have the sole discretion to interpret therequirements of the Code, including Section 409A, for purposes of the Plan andall Awards.

#  

# SECTION 23.  GOVERNINGLAW.  THE PLAN AND ANY AWARDS GRANTED HEREUNDER SHALL BE GOVERNEDBY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF THEBAHAMAS, WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICTS OF LAW.

#  

# SECTION 24.  Amendmentor Discontinuance.  Subject to any government regulation and toany applicable rules of the New York Stock Exchange or any successor exchangeon which the Ordinary Shares may be listed, the Plan may be amended, modifiedor terminated by the Board without the approval of the shareholders of theCompany except that shareholder approval shall be required for any amendmentthat would (a) increase the maximum number of Ordinary Shares for whichAwards may be granted under the Plan or increase the maximum number of OrdinaryShares that may

 

15

----

 

# be delivered pursuant to Incentive Stock Options granted under thePlan; provided, however, that any adjustment underSection 14(a) shall not be an increase for purposes of thisSection 24 or (b) change the class of employees or other individualseligible to participate in the Plan. No modification, amendment or terminationof the Plan may, without the consent of the participant to whom any Award shalltheretofore have been granted, adversely affect the rights of such participant (orhis or her transferee) under such Award, unless otherwise provided by theCommittee in the applicable Award agreement.

#  

# SECTION 25.  Notices.  All notices, claims, certificates, requests, demandsand other communications hereunder shall be in writing and shall be deemed tohave been duly given and delivered if personally delivered or if sent bynationally recognized overnight courier, by telecopy or by registered orcertified mail, return receipt requested and postage prepaid, addressed asfollows:

#  

### (a)   ifto the Company:

###  

KerznerInternational LimitedStock Award Administration1000 South Pine Island RoadPlantation, FL 33024Telecopy:   (954) 809-2310Attention:  Human Resources

 

### (b)   ifto the participant, to such participant’s address as most recently supplied tothe Company and set forth in the Company’s records;

 

or to suchother address as the party to whom notice is to be given may have furnished tothe other party in writing in accordance herewith. Any such notice orcommunication shall be deemed to have been received (i) in the case ofpersonal delivery, on the date of such delivery (or if such date is not abusiness day, on the next business day after the date sent), (ii) in thecase of nationally-recognized overnight courier, on the next business day afterthe date sent, (iii) in the case of telecopy transmission, when received(or if not sent on a business day, on the next business day after the datesent), and (iv) in the case of mailing, on the third business dayfollowing the date on which the piece of mail containing such communication isposted.

 

# SECTION 26.  Headings.  Theheadings contained in this Plan are for reference purposes only and shall notaffect the meaning or interpretation of this Plan.

#  

# SECTION 27.  Successorsand Assigns.  This Plan shall inure to the benefit of and bebinding upon each successor and assign of the Company. All obligations imposedupon a participant, and all rights granted to the Company hereunder, shall bebinding upon the participant’s heirs, legal representatives and successors.

#  

# SECTION 28.  Effectof Plan.  Neither the adoption of the Plan nor any action of theBoard or Committee shall be deemed to give any director, officer, employee

 

16

----

 

# or consultant any right to be granted any Awards hereunder except asmay be evidenced by an Award agreement, or any amendment thereto, dulyauthorized by the Committee and executed on behalf of the Company, and thenonly to the extent and on the terms and conditions expressly set forth therein.

#  

# SECTION 29.  Term.  Unlesssooner terminated by action of the Board, the right to grant Awards under thisPlan shall terminate ten years from the date of adoption of the Plan. TheCommittee may not grant Awards under the Plan after that date, but Awardsgranted before that date will continue to be effective in accordance with theirterms and the terms of the Plan.

#  

# SECTION 30.  Effectiveness.  ThePlan shall take effect upon its adoption by the Board; provided, however,that no Incentive Stock Options may be granted under the Plan unless the Planis approved by the Company’s shareholders within twelve (12) months beforeor after the date it is adopted by the Board.

#  

# SECTION 31.  Definitions.  Forthe purposes of this Plan, unless the context requires otherwise, the followingterms shall have the meanings indicated:

#  

“Affiliate”of a Person means any other Person which, directly or indirectly, controls, iscontrolled by or is under common control with such Person (excluding anytrustee under, or any committee with responsibility for administering, anyplan).

 

“Award”means, collectively, Options, Restricted Shares and Other Stock-Based Awardsgranted under the Plan.

 

“Board”means the board of directors of the Company.

 

“Cause”shall have the meaning provided in the applicable Award agreement.

 

“Change ofControl” means the occurrence of any one of the following events:

 

(a)any “person” (as such term is defined in Section 3(a)(9) of the ExchangeAct, and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act)becomes the “beneficial owner” (as defined in Rule 13d-3 under theExchange Act), directly or indirectly, of securities of the Companyrepresenting 50% or more of the combined voting power of the Company’s thenoutstanding securities eligible to vote for the election of the Board (the “CompanyVoting Securities”); provided, however, that the eventdescribed in this paragraph (a) shall not be deemed to be a Change ofControl if such event results from any of thefollowing:  (i) the acquisition of Company Voting Securities bythe Company or any of its Subsidiaries, (ii) the acquisition of CompanyVoting Securities by any employee benefit plan (or related trust) sponsored ormaintained by the Company or any of its Subsidiaries, (iii) theacquisition of Company Voting Securities by

 

17

----

 

any underwriter temporarily holding securitiespursuant to an offering of such securities or (iv) the acquisition ofCompany Voting Securities pursuant to a Non-Qualifying Transaction (as definedin paragraph (c) below); provided further, however, that aChange of Control shall be deemed not to have occurred solely as a result of(x) two or more persons who as of the date hereof are beneficial owners of CompanyVoting Securities or (y) one or more persons who as of the date hereof arebeneficial owners of Company Voting Securities together with one or morepersons who as of the date hereof are not beneficial owners of Company VotingSecurities, being treated as a single person (under Section 3(a)(9),13(d)(3) or 14(d)(2) of the Exchange Act) for purposes of thisparagraph (a) unless, in either such case, (A) such personsconsummate a “going private” transaction (as determined by the IncumbentDirectors (as defined in paragraph (b) below) in their sole discretion) or(B) an event described in paragraph (b) or (c) below otherwiseoccurs;

 

(b)individuals who, as of the date on which the Plan is adopted by the Board,constitute the Board (the “Incumbent Directors”) cease for any reason toconstitute at least a majority of the Board without the approval of theIncumbent Directors; provided, however, that any individualbecoming a director subsequent to the date on which the Plan is adopted by theBoard, whose election or nomination for election was approved (either by aspecific vote or by approval of the proxy statement of the Company in whichsuch individual is named as a nominee for director, without written objectionto such nomination) by a vote of at least a majority of the directors who were,as of the date of such approval, Incumbent Directors, shall be an IncumbentDirector; provided further, however, that no individual initiallyappointed, elected or nominated as a director of the Company as a result of anactual or threatened election contest with respect to the election or removalof directors or as a result of any other actual or threatened solicitation ofproxies or consents by or on behalf of any person other than the Board shall bean Incumbent Director;

 

(c)the consummation of a Reorganization or a Sale, unless, immediately followingsuch Reorganization or Sale:  (i) morethan 50% of the total voting power (in respect of the election of directors, orsimilar officials in the case of an entity other than a corporation) of(A) the entity resulting from such Reorganization, or the entity which hasacquired all or substantially all the Company’s assets (in either case, the “SurvivingEntity”), or (B) if applicable, the ultimate parent entity thatdirectly or indirectly has beneficial ownership of more than 50% of the totalvoting power (in respect of the election of directors, or similar officials inthe case of an entity other than a corporation) of the Surviving Entity (the “ParentEntity”), is represented by Company Voting Securities that were outstandingimmediately prior to such Reorganization or Sale (or, if applicable, isrepresented by shares into which such Company Voting Securities were convertedpursuant to such Reorganization or Sale), (ii) no person (other than anyemployee benefit plan (or related trust) sponsored or maintained by theSurviving Entity or the Parent Entity) is or becomes the beneficial owner,directly

 

18

----

 

or indirectly, of 50% or more of the total votingpower in respect of the election of directors (or similar officials in the caseof an entity other than a corporation) of the outstanding voting securities ofthe Parent Entity (or, if there is no Parent Entity, the Surviving Entity) and(iii) at least a majority of the members of the board of directors (orsimilar officials in the case of an entity other than a corporation) of theParent Entity (or, if there is no Parent Entity, the Surviving Entity)following the consummation of the Reorganization or Sale were IncumbentDirectors at the time of the approval by the Board of the execution of theinitial agreement providing for such Reorganization or Sale or, in the absenceof such an agreement, at the time at which approval of the Board was obtainedfor such Reorganization or Sale (any Reorganization or Sale that satisfies allthe criteria specified in the foregoing clauses (i), (ii) and (iii) shall bedeemed to be a “Non-Qualifying Transaction”); or

 

(d)the shareholders of the Company approve a plan of complete liquidation ordissolution of the Company.

 

Notwithstandingthe foregoing, if any person becomes the beneficial owner of 50% or more of thecombined voting power of Company Voting Securities solely as a result of theacquisition of Company Voting Securities by the Company which reduces thenumber of Company Voting Securities outstanding, such increased percentage ofbeneficial ownership shall be deemed not to result in a Change of Control; provided,however, that if such person subsequently becomes the beneficial ownerof additional Company Voting Securities that increases the percentage ofoutstanding Company Voting Securities beneficially owned by such person, aChange of Control shall then be deemed to occur.

 

“Code”means the United States Internal Revenue Code of 1986, as amended, and allrules and regulations promulgated thereunder.

 

“Committee”means the committee of two or more directors designated by the Board to operateand administer the Plan (or, in the absence of any such designation, means theBoard). To the extent the Committee has delegated authority pursuant toSection 2(d) of the Plan, references to the Committee shall be deemed torefer to the person to whom such authority has been delegated, as the contextmay require.

 

“Company”means Kerzner International Limited, a corporation organized under the laws ofthe Commonwealth of the Bahamas.

 

“Disability”means a mental or physical illness that entitles the participant to receivebenefits under the long-term disability plan of the Company or an Affiliateprovided the participant remains totally disabled for six (6) consecutivemonths. If the participant is not covered by such a plan, Disability shall bedefined by reference to the Company’s long-term disability plan as if such planapplied to the participant.

 

“DividendEquivalent” has the meaning given such term in Section 10(b) of thePlan.

 

19

----

 

“ExchangeAct” means the United States Securities Exchange Act of 1934, as amended,and all rules and regulations promulgated thereunder.

 

“ExercisableOther Stock-Based Award” has the meaning given such term inSection 11(l) of the Plan.

 

“FairMarket Value” means, as of any date, the closing price per Ordinary Shareon the New York Stock Exchange on such date (or, if such date is not a tradingday on the New York Stock Exchange, on the next preceding trading day) or, ifthe Ordinary Shares are not listed on the New York Stock Exchange, the closingprice per Ordinary Share on the principal national securities exchange on whichthe Ordinary Shares are listed (or, if such date is not a trading day on suchexchange, on the next preceding trading day) or, in all other cases, such valueas determined by the Committee in good faith.

 

“IncentiveStock Option” means an option to acquire Ordinary Shares granted pursuantto the Plan, which option is intended to qualify as an “incentive stock option”within the meaning of Section 422(b) of the Code and which is sodesignated in the applicable Award agreement.

 

“NonqualifiedStock Option” means any option to acquire Ordinary Shares granted pursuantto the Plan, other than an Incentive Stock Option.

 

“Option”means an Incentive Stock Option, a Nonqualified Stock Option or both, as thecontext requires.

 

“OrdinaryShares” means the ordinary shares, par value U.S.$ 0.001 per share, of theCompany which the Company is currently authorized to issue or may in the futurebe authorized to issue, provided that any such future authorized ordinaryshares of the Company either do not vary from the currently authorized ordinaryshares of the Company or vary only in amount of par value.

 

“OtherStock-Based Award” means an award granted under Section 10 of thePlan.

 

“Plan”means this Kerzner International Limited 2005 Stock Incentive Plan, as amendedfrom time to time.

 

“Person”means any individual, corporation, partnership, association, joint-stockcompany, trust, unincorporated organization, government or politicalsubdivision thereof or other entity.

 

“QualifyingTermination” means:

 

(a)the termination by the Company of the participant’s employment other than forCause and other than due to the participant’s death or Disability; or

 

20

----

 

(b)the termination by the participant of the participant’s employment followingthe occurrence, without the participant’s express written consent, of any ofthe following acts by the Company, or failures by the Company to act, unless,in the case of any act or failure to act described in paragraph (iii)below, such act or failure to act is corrected within ten days followingthe notice of termination given by the participant in respect thereof:

 

(i)a material reduction by the Company in the participant’s annual base salary and/orthe level of the participant’s entitlement under the Company’s annual bonusplan;

 

(ii)the Company’s requiring the participant to be based at any location beyond 50miles of the location of such participant’s then current principal place ofemployment, except for required travel on the Company’s business to an extentsubstantially consistent with the participant’s duties and responsibilities;

 

(iii)(A) the failure by the Company to continue to provide the participant withbenefits not materially less favorable in the aggregate than those thencurrently enjoyed by the participant under any of the Company’s compensation,pension, savings, life insurance, medical, health and accident, or disabilityplans, (B) the taking of any action by the Company which would directly orindirectly materially reduce any of such benefits or deprive the participant ofany material fringe benefit then currently enjoyed by the participant (withoutotherwise providing the participant with a substantially equivalent replacementbenefit or cash equivalent), or (C) the failure by the Company to providethe participant with the number of paid vacation days to which the participantis entitled on the basis of years of service with the Company in accordancewith the Company’s vacation policy.

 

Theparticipant’s right to terminate the participant’s employment under thepreceding clause (b) shall not be affected by the participant’s incapacitydue to physical or mental illness. The participant will be deemed to havewaived his or her rights to claim a Qualifying Termination relating tocircumstances described in the preceding clause (b) if he or she has notprovided to the Company a written notice of termination within ninety(90) days following his or her knowledge of such circumstances.

 

“Reorganization”means a merger, consolidation, statutory share exchange or similar form ofcorporate transaction involving (a) the Company or (b) any of itswholly owned Subsidiaries, but in the case of this clause (b), only ifCompany Voting Securities are issued or issuable, unless, in the case of eitherclause (a) or clause (b), the Committee determines, in its sole discretion,that, immediately prior to the consummation of such transaction, the primaryparty thereto, other than the Company and any of its Subsidiaries, directly orindirectly, controlled, was controlled by or was under common control with theCompany.

 

21

----

 

“RestrictedShare” means an Ordinary Share subject to such restrictions as the Committeemay determine from time to time.

 

“RestrictionPeriod” has the meaning given such term in Section 9(b) of the Plan.

 

“RetainedDistribution” has the meaning given such term in Section 9(b) of thePlan.

 

“Retirement”has the meaning given such term in Section 11(d) of the Plan.

 

“Sale”means the sale or disposition of all or substantially all the assets of theCompany, unless the Committee determines, in its sole discretion, that,immediately prior to such acquisition, the entity acquiring such assets,directly or indirectly, controlled, was controlled by or was under commoncontrol with the Company.

 

“Subsidiary”of any Person means another Person, an amount of the voting securities, othervoting ownership or voting partnership interests of which is sufficient toelect at least a majority of its board of directors or other governing body(or, if there are no such voting interests, 50% or more of the equity interestsof which) is owned directly or indirectly by such first Person or by anotherSubsidiary of such first Person. The term “Subsidiaries” means more than one ofany such Persons.

 

“SubstituteAwards” has the meaning given such term in Section 14(b) of the Plan.

 

“WithholdingTax” has the meaning given such term in Section 13 of the Plan.

 

22

----