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Exhibit 10(e)  

 
  SEA CONTAINERS LTD.
  2004 STOCK OPTION PLAN
  (As adopted by the Board of Directors on February 9, 2004,
  and approved by shareholders on June 7, 2004.)    

 
  1. The Plan    
    

        Sea Containers Ltd. (the "Company") may grant, in the manner and upon the terms and conditions set forth herein, options to purchase not in excess of an
aggregate of 500,000 *Class A or Class B common shares of the Company (adjusted, if necessary, in accordance with Section 12) to eligible directors, officers and employees of the
Company and its subsidiaries (as determined in accordance with Section 3). Shares may be either authorized but unissued shares or acquired shares. 

 
 

2. Administration of the Plan    
    

        The Plan shall be administered, and the options hereunder shall be granted, by the Board of Directors of the Company or a committee thereof from time to time
constituted pursuant to the Bye-Laws of the Company. Any decision of the Board or the committee shall be final and conclusive in all matters relating to the Plan. The Board or the
committee may make or vary regulations for the administration and operation of the Plan not inconsistent with the provisions hereof. The Board or the committee may act only by a majority of its
members in office, except that the members may authorize any one or more of their number or the Secretary of the Company to execute and deliver documents on their behalf. No member of the Board or the
committee shall be liable for anything done or omitted to be done by him or by any other member in connection with the Plan, except for his own willful misconduct or as expressly provided by statute. 

        The
Board or the committee shall have authority to (a) adopt a subsidiary plan (the "U.K. Plan") under the Plan which provides for the grant of options on shares reserved under
the Plan to eligible United Kingdom resident directors, officers and employees and complies with the requirements imposed by the United Kingdom Board of Inland Revenue, and (b) prescribe the
form of options granted under the Plan; provided, however, in each case that the terms and conditions of the U.K. Plan and the form of the option are not more favorable to optionees than the terms and
conditions of the Plan. Any option granted under the U.K. Plan shall be deemed to be outstanding also under the Plan. 

        The
Board or the committee is authorized, in its discretion exercised at the time of grant, to designate options as "United States incentive stock options" within the meaning of
Section 422 of the United States Internal Revenue Code. 

 
 

3. To Whom Options May Be Granted    
    

        Options may be granted to those directors, officers and employees of the Company or any subsidiary who, in the opinion of the Board or the committee, have
contributed significantly to the growth and progress of the Company or any subsidiary or to persons who, in the opinion of the Board or the committee, hold promise of contributing to the growth and
progress of the Company or any subsidiary and who can be attracted to directorship, officership or employment through the grant of options under the Plan. The Board or the committee is hereby given
the authority to determine which of the eligible directors, officers and employees are to be granted options and the number of shares to be allocated to each. 

1

 

        No
United States incentive stock option shall be granted to a person who is not an employee or (except as provided in Sections 4 and 7) to an employee who owns (or would be
regarded as owning) shares possessing more than ten percent of the total combined voting power of all classes of shares of the Company or its subsidiaries at the time the option is granted. In
addition, in the case of United States incentive stock options, the aggregate fair market value (determined at the time the option is granted) of the shares with respect to which incentive stock
options are exercisable for the first time by an employee during any calendar year (under all United States incentive stock option plans of the Company and its subsidiaries) shall not exceed
U.S.$100,000. 

        The
term "subsidiary" means any corporation in an unbroken chain of corporations beginning with the Company, each of which owns at the time such option is granted (except in the case of
the last such corporation in the chain) shares possessing 50 percent or more of the total combined voting power of all classes of shares in one of the other corporations in such chain. 

 
 

4. Option Price    
    

        The option price per share shall be not less than the fair market value of the shares subject to the option at the time it is granted, as determined in good faith
by the Board or the committee. If a United States incentive stock option is granted to an employee who at the time the option is granted owns (or would be regarded as owning) shares possessing more
than ten percent of the total combined voting power of all classes of shares of the Company or its subsidiaries, the option price shall be at least 110 percent of the fair market value of the
shares subject to the option at the time it is granted. The option price shall be subject to adjustment in accordance with Section 12. 

 
 

5. Circumstances Under Which Options May Be Granted    
    

        Options may be granted at any time and from time to time on or after the date on which the Plan is adopted by the Board of Directors of the Company and before the
expiration of ten years therefrom. If prior to the expiration of ten years from the date on which the Plan is adopted, an option shall expire or otherwise terminate without having been exercised in
full, the unexercised shares shall thereupon become available for the granting of options to other eligible directors, officers and employees. No option shall be granted unless, at the time such
option is granted, the Company shall have available at least the number of shares covered by such option and by all other options then outstanding under the Plan. 

 
 

6. Options Not Assignable    
    

        Every option granted under the Plan shall provide that it is not transferable by the person to whom it is granted, otherwise than by will or the laws of descent
and distribution, and that it is exercisable, during his lifetime, only by him. 

 
 

7. Manner of Exercise of Options    
    

        Any person to whom an option has been granted may exercise the same, subject to the provisions of Section 10, at any time and from time to time before the
expiration of not more than ten years (or, in the case of any United States incentive stock option granted to an employee subject to the second sentence of Section 4, not more than five years)
from the date the option was granted. Any such exercise shall be effected by giving written notice to the Company, in a form satisfactory to the Board or the committee, specifying the number of shares
with respect to which the option is being exercised. Any person to whom an option has been granted under the U.K. Plan may exercise the same under the Plan, subject to all the provisions hereof and
provided that in the written notice of exercise the person states that he is exercising under the Plan and not under the U.K. Plan. 

2

 

 
 

8. Manner of Payment on Exercise of Options    
    

        At the time of giving such notice, such person shall pay or cause to be paid to the Company the full option price of the shares as to which the option is
exercised. As soon as practicable thereafter, the Company shall cause a certificate or certificates for such shares to be registered in the name of such person, in such denominations as such person
may direct, and shall deliver said certificate or certificates to or upon the order of such person. 

        Notwithstanding
the foregoing, on concurrence by the Board or the committee (which concurrence may be granted or withheld in its sole discretion) the person exercising an option may
elect to defer, for a term not to exceed five years from the date of exercise, payment of all or a portion of the option price of the shares as to which the option is exercised, provided, however
that: 

	(a)
	in
the case of an optionee who is a "United States person" within the meaning of Regulation X of the Board of Governors of the Federal Reserve System of the United States of
America, the portion of the option price so deferred for future payment shall not exceed the "good faith loan value" of the shares, within the meaning of the applicable provisions of
Regulation G of such Board and as may be in effect on the date of exercise if such deferral is then subject to such regulation;

	(b)
	the
shares for which the option is exercised shall be issued to and registered in the name of the person exercising the option but shall be endorsed by the person in blank (either on
the certificate or on a separate stock power) and held by the Company as collateral for the deferred portion of the option price;

	(c)
	the
person exercising the option shall execute a promissory note or other instrument of like effect in favor of the Company in a principal amount equal to the deferred portion of the
option price, which instrument shall provide for the payment of interest at the rate, determined by the Board or the committee, of at least four percent per annum, payable quarterly;

	(d)
	the
person exercising the option shall have the right at any time and from time to time to withdraw part or all of the option shares from the collateral so held by the Company upon
payment of a corresponding portion of the deferred option price, together with any accrued interest thereon, and that upon such payment the person exercising the option shall be discharged under the
promissory note or other instrument, pro tanto, and shall then be free to dispose of the shares in any manner he may deem appropriate, subject to the relevant conditions and restrictions of the Plan;
and

	(e)
	the
deferred payment arrangement shall be subject to such further terms and conditions as may be prescribed by the Board or the committee upon the exercise of options. 

        The
person exercising an option shall be entitled, from the date of exercise, to all the rights of a shareholder as to the shares covered by the exercise, including the right to vote the
shares and to receive and retain all dividends paid thereon. 

3

 

 
 

9. Exercise After Death of Person to Whom Granted    
    

        In the event the person to whom an option is granted shall die owning but without having fully exercised the option, his estate or any person who acquired the
right to exercise the option by bequest or inheritance or by reason of the death of the optionee may, subject to the provisions of Section 10 (except subsection 10(b) and (d)), exercise the
option at any time and from time to time before the expiration of the period of one year after the date of death, notwithstanding that the exercise may occur less than three years or more than ten
years after the date of grant thereof, but only if the person so exercising the option shall have furnished the Company with evidence satisfactory to the Company of the person's right to exercise the
option and of payment or provision for the payment of any estate, transfer, inheritance or death taxes payable with respect to the option or the shares to which it relates. Any such exercise shall be
effected in the manner described in Sections 7 and 8. Any such exercise, however, shall not be permitted in the case of a United States incentive stock option after the expiration of ten years from
the date the option was granted. 

 
 

10. Circumstances Under Which Options May Not Be Exercised    
    

        Every option under the Plan shall provide that it may not be exercised (except as may be otherwise provided in Sections 9 and 11): 

	(a)
	until
the shares reserved for issuance upon the exercise thereof have been listed upon any national securities exchange in the United States of America on which the Company's
Class A or B common shares are then listed;

	(b)
	until
the expiration of a period of three years from the date the option was granted, and in any event not after (i) the expiration of a period of three months from the date a
person ceases to be a director, officer or employee of the Company or a subsidiary thereof under circumstances not involving misconduct, impropriety or inefficiency on his part or (ii) the
termination of the directorship, officership or employment of a person by the Company or a subsidiary thereof or the shareholders for reasons involving misconduct, impropriety or inefficiency on his
part; provided, however, that a person ceasing to be a director, officer or employee of the Company or a subsidiary thereof on account of (i) retirement at or after the normal retirement date,
(ii) early retirement not earlier than five years before the normal retirement date, (iii) injury or disability, (iv) dismissal for redundancy or (v) on concurrence of the
Board or the committee (which concurrence may be granted or withheld in its sole discretion), the sale or other disposition of the subsidiary for which the person acts as director or officer or which
employs the employee or the operating division of the Company or a subsidiary for which the employee performs his employment, shall be entitled to exercise an option at any time prior to the
expiration of a period of three months from the date he ceases to be a director, officer or employee of the Company or a subsidiary thereof notwithstanding that such exercise is made prior to the
expiration of a period of three years from the date such option was granted (and for purposes of this Section 10 hereof, the directorship, officership or employment of any person with the
Company or a subsidiary thereof shall not be deemed to have ceased or terminated so long as such person shall continuously since the date of grant of the option be a director, officer or employee
either of the Company or a subsidiary thereof or of Orient-Express Hotels Ltd. or a subsidiary thereof);

	(c)
	unless
the Board or the committee shall be satisfied that the issuance of shares upon exercise will be in compliance with all relevant rules and regulations of the United States
Securities and Exchange Commission; or

	(d)
	after
the expiration of ten years from the date the option is granted. 

4

 

 
 

11. Change in Control    
    

        For purposes of this Section 11, "Change in Control" means any of the following events: 

	(a)
	any
"person" (as that term is defined for the purposes of Section 13(d) or 14(d) of the U.S. Securities Exchange Act of 1934), other than James B. Sherwood or a group including
James B. Sherwood or any subsidiary of the Company, shall directly or indirectly acquire more than 40% of the voting shares of the Company then outstanding and then entitled to vote generally in the
election of directors of the Company; or

	(b)
	individuals
who, on the date of adoption of the Plan, constitute the Company's Board of Directors (or the successors of such individuals nominated by such Board of Directors or a
committee thereof on which such individuals or their successors constitute a majority) shall cease to constitute a majority of the Company's Board of Directors; or

	(c)
	the
Company amalgamates, merges or consolidates with or into any other corporation, other than a corporation which directly, or indirectly through one or more intermediaries, is
controlled by James B. Sherwood or a group including James B. Sherwood, without the approval of its Board of Directors constituted as provided in clause (b) above; or

	(d)
	the
Company sells, leases, exchanges or otherwise disposes of all or substantially all of its assets and business without the approval of its Board of Directors constituted as
provided in clause (b) above. 

        In
the event of a Change in Control, and notwithstanding anything to the contrary in Section 3, any outstanding option granted under the Plan which an optionee shall not then have
been entitled to exercise shall become exercisable immediately prior to or concurrently with the occurrence of the Change in Control and the optionee shall have the right to exercise all such options. 

        Notwithstanding
anything in the Plan to the contrary, in the event of exercise of an option following a Change in Control, the optionee may elect, in the written notice provided for in
Sections 7 and 8, (i) to pay or cause to be paid to the Company the full option price of the shares as to which the option is exercised, or (ii) to surrender to the Company all or any
part of an option and receive from the Company upon such surrender an amount in cash equal to the excess, if any, of the determined value of the shares subject to the option or portion thereof so
surrendered over the aggregate exercise price of such shares as set forth in the applicable option grant letter. The term "determined value" as used herein means the higher of (A) the highest
sale price per Class A or B common share of the Company on the New York Stock Exchange (or, if any of such shares are not listed on that exchange at that time, then the highest sale price of
the shares on the principal stock exchange on which such shares are listed, or if such shares are not listed, then the over-the-counter market) during the 12 months
immediately preceding the date of the Change in Control, or (B) the highest price per share actually paid in connection with any Change in Control (including, without limitation, prices paid in
any subsequent amalgamation, merger or combination with any entity that acquires control of the Company), in either case multiplied by the number of shares subject to the option or portion thereof so
surrendered. In the event of a surrender of all or a portion of an option pursuant to this Section, the number of shares as to which the option was surrendered shall not again become available for use
under the Plan. 

5

 

        The
obligations of the Company under the Plan shall be binding upon any successor company, corporation or other organization resulting from any amalgamation, merger, consolidation or
other reorganization of the Company, or upon any successor company, corporation or organization succeeding to all or substantially all of the assets and business of the Company, in any such case which
would constitute a Change in Control. The Company agrees that it will make appropriate provisions for the preservation of all optionees' rights under the Plan in any agreement or plan that it may
enter into or adopt to effect any such amalgamation, merger, consolidation, reorganization or transfer of assets constituting a Change in Control. 

 
 

12. Adjustment of Number or Kind of Shares    
    

        If the Company shall effect one or more share splits, share dividends, combinations of shares, exchanges of shares or similar capital adjustments, the Board or
the committee shall appropriately adjust the aggregate number and kind of shares with respect to which options have been granted or may be granted under the Plan. Every option granted under the Plan
shall provide that, in the event of any such capital adjustments, the number and kind of the shares with respect to which it may be exercised, and the option price, shall be appropriately adjusted. 

 
 

13. Amendment    
    

        The Plan may be amended from time to time by the Board of Directors of the Company. No amendment shall alter or impair any of the rights or obligations of any
person, without his consent, under any option theretofore granted under the Plan. 

 
 

14. Termination    
    

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

	(a)
	if
the Company is a participant in any corporate amalgamation, merger, consolidation or other transaction and no provision is made at the time of the transaction to continue the Plan,
except as provided in Section 11;

	(b)
	resolution
of the Board of Directors of the Company terminating the Plan; or

	(c)
	on
February 8, 2014. 

        In
the event of termination of the Plan in any of the ways provided hereinabove, the provisions of the Plan shall continue in full force and effect as regards any options granted prior
to such termination. 

 
 

15. Effect of Options Upon Employment    
    

        Nothing in the Plan shall be construed as giving any person acting as a director or officer of or employed by the Company or any subsidiary thereof the right to
be retained in such directorship, officership or employment. The Company and any subsidiary thereof and the shareholders shall have the right to dismiss any director, officer or employee at any time
with or without cause and without liability for the effect which such dismissal might have upon him as a participant under the Plan, and under no circumstances shall a person ceasing to be a director,
officer or employee by reason of dismissal or otherwise be entitled to or claim against the Company or any subsidiary thereof any compensation for or in respect of any consequent reduction or loss of
his rights or benefits (actual or prospective) under any option held by him in connection with the Plan. 

 
 

16. Construction    
    

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

*
* * * * 

6

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SEA CONTAINERS LTD. 2004 STOCK OPTION PLAN (As adopted by the Board of Directors on February 9, 2004, and approved by shareholders on June 7, 2004.)

1. The Plan

2. Administration of the Plan

3. To Whom Options May Be Granted

4. Option Price

5. Circumstances Under Which Options May Be Granted

6. Options Not Assignable

7. Manner of Exercise of Options

8. Manner of Payment on Exercise of Options

9. Exercise After Death of Person to Whom Granted

10. Circumstances Under Which Options May Not Be Exercised

11. Change in Control

12. Adjustment of Number or Kind of Shares

13. Amendment

14. Termination

15. Effect of Options Upon Employment

16. ConstructionQuickLinks
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Exhibit 10(k)  

18 March 2005  

 STRATEGIC RAIL AUTHORITY  

 and  

 GREAT NORTH EASTERN RAILWAY LIMITED  

INTERCITY EAST COAST

FRANCHISE AGREEMENT  

  

 
  Contents    
    

	CLAUSE
 
	 	PAGE

	1.    Interpretation and Definitions	 	1
	

2.    Commencement	
 	

1
	

3.    Term	
 	

2
	

4.    Franchisee's Obligations	
 	

2
	

5.    Arm's Length Dealings	
 	

2
	

6.    Compliance with Laws	
 	

2
	

7.    Entire Agreement	
 	

3
	

8.    Governing Law	
 	

3
	

SCHEDULE 1	
 	

6
	 	Passenger Service Obligations	 	6
	

SCHEDULE 1.1	
 	

8
	 	Service Development	 	8
	

APPENDIX 1 TO SCHEDULE 1.1	
 	

20
	 	The Train Fleet	 	20
	

APPENDIX 2 TO SCHEDULE 1.1	
 	

24
	 	Service Development Additional Factors	 	24
	

SCHEDULE 1.2	
 	

26
	 	Operating Obligations	 	26
	

SCHEDULE 1.3	
 	

34
	 	Additional Service Specifications	 	34
	

SCHEDULE 1.4	
 	

38
	 	Passenger Facing Obligations	 	38
	

APPENDIX 1 TO SCHEDULE 1.4	
 	

48
	 	Form of Passenger's Charter	 	48
	

APPENDIX 2 TO SCHEDULE 1.4	
 	

66
	 	Alternative Transport	 	66
	

SCHEDULE 1.5	
 	

68
	 	Information about Passengers	 	68
	

SCHEDULE 1.6	
 	

70
	 	Committed Obligations	 	70
	

APPENDIX 1 TO SCHEDULE 1.6	
 	

98
	 	Programme of Committed Obligations	 	98
	

APPENDIX 2 TO SCHEDULE 1.6	
 	

102
	 	Liquidated Damages for Late Completion of Committed Obligations	 	102
	

APPENDIX 3 TO SCHEDULE 1.6	
 	

106
	

GNER HST Refurbishment	
 	

106
	 	 	 

i

 

	

SCHEDULE 1.7	
 	

110
	 	Franchise Services	 	110
	

SCHEDULE 1.8	
 	

116
	 	Major Projects	 	116
	

SCHEDULE 2	
 	

118
	 	Assets, Leases, Third Parties, Other Franchise Operations and Schemes	 	118
	

SCHEDULE 2.1	
 	

119
	 	Asset Vesting and Transfer	 	119
	

SCHEDULE 2.2	
 	

121
	 	Security of Access Assets, Rolling Stock Leases, Station and Depot Leases	 	121
	

SCHEDULE 2.3	
 	

125
	 	Third Party Delivery of Passenger Services and Other Franchisees	 	125
	

SCHEDULE 2.4	
 	

127
	 	Other Franchise Operations	 	127
	

SCHEDULE 2.5	
 	

129
	 	Transport, Travel and Other Schemes	 	129
	

APPENDIX TO SCHEDULE 2.5	
 	

133
	 	List of Transport, Travel and Other Schemes	 	133
	

SCHEDULE 3	
 	

136
	 	Priced Options	 	136
	

SCHEDULE 4	
 	

138
	 	Maintaining and Enhancing Stations, Depots and Trains	 	138
	

SCHEDULE 4.1	
 	

140
	 	Franchise Facilities	 	140
	

APPENDIX TO SCHEDULE 4.1	
 	

146
	 	Station Surveys	 	146
	

SCHEDULE 4.2	
 	

148
	 	Persons with Disabilities and Disability Discrimination	 	148
	

APPENDIX TO SCHEDULE 4.2	
 	

154
	 	Minor Works	 	154
	

SCHEDULE 5	
 	

156
	 	Fares	 	156
	

SCHEDULE 5.1	
 	

158
	 	Purpose, Structure and Construction	 	158
	

SCHEDULE 5.2	
 	

162
	 	Franchisee's Obligation to Create Fares	 	162
	

SCHEDULE 5.3	
 	

164
	 	Allocation of Fares to Fares Baskets	 	164
	

SCHEDULE 5.4	
 	

166
	 	Regulation of Fares Basket Values	 	166
	 	 	 

ii

 

	

SCHEDULE 5.5	
 	

168
	 	Regulation of Individual Fares	 	168
	

SCHEDULE 5.6	
 	

170
	 	Exceeding the Regulated Value, Regulated Price or Regulated Child Price	 	170
	

SCHEDULE 5.7	
 	

172
	 	Changes to Fares and Fares Regulation	 	172
	

SCHEDULE 5.8	
 	

176
	 	Fares Regulation Information and Monitoring	 	176
	

SCHEDULE 6	
 	

178
	 	Farebox Securitisation	 	178
	

SCHEDULE 7	
 	

180
	 	Performance Benchmarks/Key Performance Indicators	 	180
	

SCHEDULE 7.1	
 	

182
	 	Performance Benchmarks	 	182
	

APPENDIX 1 TO SCHEDULE 7.1	
 	

190
	 	Cancellations Benchmark Table	 	190
	

APPENDIX 2 TO SCHEDULE 7.1	
 	

192
	 	Capacity Benchmark Table	 	192
	

APPENDIX 3 TO SCHEDULE 7.1	
 	

194
	 	Network Rail Benchmark Table	 	194
	

APPENDIX 4 TO SCHEDULE 7.1	
 	

197
	 	Service Delivery Benchmark Table	 	197
	

SCHEDULE 7.2	
 	

200
	 	Key Performance Indicators	 	200
	

APPENDIX TO SCHEDULE 7.2	
 	

218
	 	Average Profit Table	 	218
	

SCHEDULE 8	
 	

223
	 	Payments	 	223
	

SCHEDULE 8.1	
 	

225
	 	Franchise Payments	 	225
	

SCHEDULE 8.2	
 	

233
	 	Annual Franchise Payments	 	233
	

APPENDIX 1 TO SCHEDULE 8.2	
 	

236
	 	Target Revenue (expressed in real terms)	 	236
	

APPENDIX 2 TO SCHEDULE 8.2	
 	

239
	 	Figures for Calculation of Annual Franchise Payments	 	239
	

APPENDIX 3 TO SCHEDULE 8.2	
 	

241
	 	(HRO scheme 1 only)	 	241
	

SCHEDULE 8.3	
 	

244
	 	Miscellaneous Payment Provisions	 	244
	 	 	 

iii

 

	

SCHEDULE 8.4	
 	

246
	 	Track Access Adjustments and Station Charge Adjustments	 	246
	

SCHEDULE 9	
 	

250
	 	Changes	 	250
	

SCHEDULE 9.1	
 	

252
	 	Financial Consequences of Change	 	252
	

SCHEDULE 9.2	
 	

256
	 	Identity of the Financial Model etc.	 	256
	

SCHEDULE 9.3	
 	

258
	 	Runs of the Financial Model	 	258
	

APPENDIX TO SCHEDULE 9.3	
 	

264
	 	Incentivising Long-Term Investment	 	264
	

SCHEDULE 9.4	
 	

266
	 	Authority Risk Assumptions	 	266
	

SCHEDULE 10	
 	

268
	 	Remedies, Termination and Expiry	 	268
	

SCHEDULE 10.1	
 	

270
	 	Remedial Plans and Remedial Agreements	 	270
	

SCHEDULE 10.2	
 	

272
	 	Termination and Expiry	 	272
	

SCHEDULE 10.3	
 	

274
	 	Events of Default and Termination Event	 	274
	

SCHEDULE 10.4	
 	

280
	 	Force Majeure	 	280
	

SCHEDULE 10.5	
 	

285
	 	Liability	 	285
	

SCHEDULE 11	
 	

287
	 	Agreement Management Provisions	 	287
	

SCHEDULE 12	
 	

291
	 	Financial Obligations and Covenants	 	291
	

APPENDIX 1 TO SCHEDULE 12	
 	

299
	 	Form of Performance Bond	 	299
	

APPENDIX 2 TO SCHEDULE 12	
 	

305
	 	Form of Season Ticket Bond	 	305
	

SCHEDULE 13	
 	

314
	 	Franchise Management and Information Obligations	 	314
	

SCHEDULE 13.1	
 	

316
	 	Franchise Management	 	316
	

SCHEDULE 13.2	
 	

320
	 	Information	 	320
	 	 	 

iv

 

	

APPENDIX 1 TO SCHEDULE 13.2	
 	

332
	 	Efficient Franchisee	 	332
	

APPENDIX 2 TO SCHEDULE 13.2	
 	

240
	 	Key Assets	 	340
	

APPENDIX 3 TO SCHEDULE 13.2	
 	

342
	 	Operational Information	 	342
	

APPENDIX 4 TO SCHEDULE 13.2	
 	

348
	 	Passenger Journeys, Miles and Earnings Information	 	348
	

SCHEDULE 14	
 	

350
	 	Preservation of Assets	 	350
	

SCHEDULE 14.1	
 	

352
	 	Maintenance of Franchise	 	352
	

SCHEDULE 14.2	
 	

354
	 	Maintenance of Operating Assets	 	354
	

SCHEDULE 14.3	
 	

358
	 	Key Contracts	 	358
	

APPENDIX TO SCHEDULE 14.3	
 	

362
	 	List of Key Contracts	 	362
	

SCHEDULE 14.4	
 	

364
	 	Designation of Franchise Assets	 	364
	

APPENDIX TO SCHEDULE 14.4	
 	

368
	 	List of Primary Franchise Assets	 	368
	

SCHEDULE 14.5	
 	

370
	 	Dealing with Franchise Assets	 	370
	

SCHEDULE 15	
 	

372
	 	Obligations Associated with Termination	 	372
	

SCHEDULE 15.1	
 	

374
	 	Reletting Provisions	 	374
	

SCHEDULE 15.2	
 	

376
	 	Last 12 or 13 Months of Franchise Period	 	376
	

SCHEDULE 15.3	
 	

382
	 	Handover Package	 	382
	

APPENDIX TO SCHEDULE 15.3	
 	

384
	 	Form of Handover Package	 	384
	

SCHEDULE 15.4	
 	

386
	 	Provisions Applying on and after Termination	 	386
	

APPENDIX 1 TO SCHEDULE 15.4	
 	

392
	 	Form of Transfer Scheme	 	392
	

APPENDIX 2 TO SCHEDULE 15.4	
 	

396
	 	Form of Supplemental Agreement	 	396
	 	 	 

v

 

	

SCHEDULE 16	
 	

410
	 	Pensions	 	410
	

SCHEDULE 17	
 	

414
	 	Confidentiality	 	414
	

SCHEDULE 18	
 	

418
	 	Franchise Continuation Criteria	 	418
	

SCHEDULE 19	
 	

420
	 	Other Provisions	 	420

[Schedules
omitted from this copy] 

vi

   THIS AGREEMENT is dated eighteenth March 2005 

BETWEEN  

	(1)
	STRATEGIC RAIL AUTHORITY, whose principal place of business is at 55 Victoria Street, London, SW1H 0EU (the  Authority);
and

	(2)
	GREAT NORTH EASTERN RAILWAY LIMITED, whose registered office is at Sea Containers House, 20 Upper Ground, London SE1 9PF (the  Franchisee). 

WHEREAS  

        (A)  The
Authority wishes to appoint a franchisee to provide railway passenger services within its InterCity East Coast franchise and expects its franchisee, on the terms of
this Agreement, actively to seek, in all reasonable business ways, greatly improved performance over the Franchise Term from its employees, its Train Fleet and other assets, and from Network Rail and
its other suppliers, so as to deliver to the passenger the best railway passenger service that can be obtained from the resources that are available to it. 

        (B)  The
Franchisee wishes to be appointed as the Authority's franchisee for its InterCity East Coast franchise and intends, on the terms of this Agreement, actively to seek,
in all reasonable business ways, greatly improved performance over the Franchise Term from its employees, its Train Fleet and other assets, and from Network Rail and its other suppliers, so as to
deliver to the passenger the best railway passenger service that can be obtained from the resources that are available to it. 

        (C)  The
following provisions of this Agreement are intended to reflect and give effect to the matters referred to in Recitals (A) and (B). 

1.     INTERPRETATION AND DEFINITIONS  

        1.1   In
this Agreement: 

Conditions Precedent Agreement means the agreement between the Authority and the Franchisee of even date herewith specifying certain conditions to be
satisfied prior to issue of a Franchise Commencement Certificate. 

Definitions Agreement means the agreement between the Authority and the Franchisee of even date herewith relating to the interpretation of this
Agreement and the Conditions Precedent Agreement. 

        1.2   This
Agreement, the Conditions Precedent Agreement and the Definitions Agreement together constitute a single agreement, which is a "franchise agreement" for the
purposes of the Act, and shall be interpreted in accordance with the Definitions Agreement. 

2.     COMMENCEMENT  

        2.1   The
clauses of this Agreement and the provisions listed in clauses 2.1(a) to 2.1(r) (inclusive) shall take effect and be binding upon each of the Authority and the
Franchisee immediately upon signature of this Agreement: 

	(a)
	paragraph 5.3
of Schedule 1.4 (Passenger Facing Obligations);

	(b)
	appropriate
provisions (if any) of Schedule 1.6 (Committed Obligations);

	(c)
	paragraph 1
of Schedule 2.1 (Asset Vesting and Transfer);

	(d)
	paragraph 2
of Schedule 2.2 (Security of Access Assets, Rolling Stock Leases, Station and Depot Leases); 

1

 

	(e)
	paragraph 2
of Schedule 2.3 (Third Party Delivery of Passenger Services and Other Franchisees);

	(f)
	paragraphs
1 and 2 of Schedule 4.1 (Franchise Facilities);

	(g)
	Schedule 5.1
(Purpose, Structure and Construction);

	(h)
	Schedule 5.3
(Allocation of Fares to Fares Baskets);

	(i)
	Schedule 5.7
(Changes to Fares and Fares Regulation);

	(j)
	Schedule 9
(Changes);

	(k)
	Schedule 10
(Remedies, Termination and Expiry);

	(l)
	paragraphs
1 to 3 (inclusive) of Schedule 11 (Agreement Management Provisions);

	(m)
	paragraph 4
of Schedule 12 (Financial Obligations and Covenants);

	(n)
	Schedule 13.1
(Franchise Management);

	(o)
	paragraphs
1, 2, 5, 6, 7 and 8 of Schedule 13.2 (Information);

	(p)
	Schedule 14.3
(Key Contracts);

	(q)
	Schedule 17
(Confidentiality); and

	(r)
	Schedule 19
(Other Provisions). 

        2.2   The
other provisions of this Agreement shall take effect and become binding upon the parties on the Franchise Commencement Date. 

3.     TERM  

        This Agreement shall terminate on the Expiry Date or on the date of any earlier termination pursuant to clause 2.2(a) of the Conditions Precedent Agreement
or pursuant to Schedule 10 (Remedies and Termination). 

4.     FRANCHISEE'S OBLIGATIONS  

        4.1   The
Franchisee shall perform its obligations under this Agreement in accordance with their terms and with that degree of skill, diligence, prudence and foresight which
would be exercised by a skilled and experienced Train Operator of the InterCity East Coast franchise. 

        4.2   Any
obligation on the part of the Franchisee to use all reasonable endeavours shall extend to consequent obligations adequately to plan and resource its activities, and
to implement those plans and resources, with all due efficiency and economy. 

        4.3   The
Franchisee shall co-operate with the Authority and act reasonably and in good faith in and about the performance of its obligations and the exercise of
its rights pursuant to this Agreement. 

5.     ARM'S LENGTH DEALINGS  

        The Franchisee shall ensure that every contract or other arrangement or transaction to which it may become party in connection with this Agreement with any person
is on bona fide arm's length terms. 

6.     COMPLIANCE WITH LAWS  

        The Franchisee shall at all times during the Franchise Term perform the Franchise Services and all its other obligations under this Agreement in accordance with
all applicable Laws. 

2

 

7.     ENTIRE AGREEMENT  

        7.1   This
Agreement, the Definitions Agreement and the Conditions Precedent Agreement contain the entire agreement between the parties in relation to the subject matter of
this Agreement and supersede all prior agreements and arrangements between the parties other than any confidentiality agreements or undertakings which the Franchisee may have entered into with the
Authority in connection with its proposal to secure the provision of the Passenger Services under this Agreement. 

        7.2   The
Franchisee hereby acknowledges that it is not entering into this Agreement in reliance on any warranties, representations or undertakings howsoever or to whomsoever
made except in so far as such are: 

	(a)
	contained
in this Agreement; or

	(b)
	embodied
in any warranties, representations or undertakings contained in the long form report provided by the Reporting Accountants in respect of Great North Eastern Railway, dated 22
July 2004. 

        7.3   The
Franchisee hereby acknowledges and agrees with the Authority (for itself and as trustee for each of the other persons referred to therein) to the disclaimer of
liability which is contained in the section entitled "Important Notice" contained in any document supplied by or on behalf of the Authority in connection with this Agreement, the process leading to
the entering into of this Agreement, or the Franchise Services (including any "Invitation to Tender" issued in connection therewith). 

        7.4   The
Franchisee irrevocably and unconditionally waives any right which it may otherwise have to claim damages in respect of and/or to rescind this Agreement on the basis
of any warranty, representation (whether negligent or otherwise, and whether made prior to and/or in this Agreement) or undertaking howsoever or to whomsoever made unless and to the extent that such
warranty, representation or undertaking was made fraudulently. 

8.     GOVERNING LAW  

        This Agreement shall be governed by and construed in accordance with the Laws of England and Wales and the parties irrevocably agree that the courts of England
and Wales are to have exclusive jurisdiction to settle any disputes which may arise out of or in connection with this Agreement, except as expressly set out in this Agreement. 

3

 

IN WITNESS whereof the parties hereto have executed this Agreement the day and year first before written. 

	THE CORPORATE SEAL

OF THE STRATEGIC RAIL

AUTHORITY

HEREUNTO AFFIXED IS

AUTHENTICATED BY:
 ROBERT PLAMPLIN	 	}	 	 
	
SIGNED FOR AND ON

BEHALF OF THE
 FRANCHISEE

DIRECTOR:

DIRECTOR:	
 	
}	
 	
  

 CHRISTOPHER GARNETT

SHAUN MILLS

4

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