-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tbe80eTgdJKCWs8gc3i5RiKi4ma8oyueJBEWX0Qa9hhDDZvC1zzZs+8aXg9rXcCw CgVb9pGm3j19Aos/Bmg2LQ== 0001123292-06-000629.txt : 20061106 0001123292-06-000629.hdr.sgml : 20061106 20061106172642 ACCESSION NUMBER: 0001123292-06-000629 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20061106 DATE AS OF CHANGE: 20061106 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: FOUR SEASONS HOTELS INC CENTRAL INDEX KEY: 0001030555 STANDARD INDUSTRIAL CLASSIFICATION: HOTELS & MOTELS [7011] IRS NUMBER: 980087570 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-52609 FILM NUMBER: 061191374 BUSINESS ADDRESS: STREET 1: 1165 LESLIE ST STREET 2: TORONTO CITY: ONTARIO CANADA STATE: A6 ZIP: M3C 2K8 BUSINESS PHONE: 4164491750 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SAUD H R H PRINCE ALWALEED BIN TALAL BIN ABDULAZIZ AL CENTRAL INDEX KEY: 0001035410 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: KINGDOM HOLDING COMPANY STREET 2: P O BOX 8653 CITY: RIYADH STATE: T0 ZIP: 00000 SC 13D 1 sc13d110606.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

FOUR SEASONS HOTELS INC.

____________________________________________________

(Name of Issuer)

Limited Voting Shares

_____________________________________________________

(Title of Class of Securities)

35100E104

______________________________________________________

(CUSIP Number)

HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud

c/o Kingdom Holding Company

Kingdom Centre – Floor 66

P.O. Box 2

Riyadh 11321

Kingdom of Saudi Arabia

011-966-1-211-1111

_______________________________________________________________

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

Copies to:

Bruce W. Gilchrist, Esq.

Hogan & Hartson L.L.P.

555 13^th Street, N.W.

Washington, D.C. 20004

(202) 637-5600

November 3, 2006

____________________________________________________________

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box x.

The information required on this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities of that section of the Exchange Act but shall be subject to all other provisions of the Exchange Act (however, see the Notes).

CUSIP No. 35100E104
1	Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only). HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud
2	Check the Appropriate Box if a Member of a Group			(a) x (b) o
3	SEC Use Only
4	Source of Funds (See Instructions) OO
5	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)			o
6	Citizenship or Place of Organization Kingdom of Saudi Arabia
Number of Shares Beneficially Owned by Each Reporting Person With		7	Sole Voting Power 7,389,182 Limited Voting Shares
		8	Shared Voting Power 179,322 Limited Voting Shares
		9	Sole Dispositive Power 7,389,182 Limited Voting Shares
		10	Shared Dispositive Power 179,322 Limited Voting Shares
11	Aggregate Amount Beneficially Owned by Each Reporting Person 7,568,504 Limited Voting Shares
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)			o
13	Percent of Class Represented by Amount in Row (11) 23%
14	Type of Reporting Person (See Instructions) IN

CUSIP No. 35100E104
1	Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only). Kingdom Investments, Inc.
2	Check the Appropriate Box if a Member of a Group			(a) x (b) o
3	SEC Use Only
4	Source of Funds (See Instructions) OO
5	Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e)			o
6	Citizenship or Place of Organization Barbados
Number of Shares Beneficially Owned by Each Reporting Person With		7	Sole Voting Power 7,389,182 Limited Voting Shares
		8	Shared Voting Power None
		9	Sole Dispositive Power 7,389,182 Limited Voting Shares
		10	Shared Dispositive Power None
11	Aggregate Amount Beneficially Owned by Each Reporting Person 7,389,182 Limited Voting Shares
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions)			o
13	Percent of Class Represented by Amount in Row (11) 22%
14	Type of Reporting Person (See Instructions) CO

Item 1.

Security and Issuer

This statement on Schedule 13D relates to the Limited Voting Shares of the Four Seasons Hotels Inc., an Ontario, Canada corporation (the “Issuer”). The Issuer’s principal executive offices are located at 1165 Leslie Street, Toronto, Ontario, Canada M3C 2K8.

Item 2.

Identity and Background

HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud (“HRH”) is a citizen of the Kingdom of Saudi Arabia and a private investor. His offices are located at c/o Kingdom Holding Company, Kingdom Centre, Floor 66, P.O. Box 2, Riyadh, 11321, Kingdom of Saudi Arabia. During the past five years, neither of the Reporting Persons (as defined below) has been convicted in any criminal proceeding or has been, or is, subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

This statement also is being filed by Kingdom Investments, Inc., a corporation organized under the laws of Barbados (“Kingdom Investments” and together with HRH the “Reporting Persons”). Kingdom Investments’ registered office address is Worthing Corporate Centre, Worthing Main Road, Christ Church BB15008, Barbados. Kingdom Investments is an indirect wholly-owned subsidiary of Kingdom Hotels International, a Cayman Islands company (“Kingdom Hotels”), which is owned jointly by Kingdom 5-KR-132 Ltd. (“KR-132”), and Kingdom 5-KR-131 Ltd. (“KR-131”), both of which are Cayman Islands companies. KR-131 is a wholly-owned subsidiary of KR-132, which, in turn, is wholly-owned by The Kingdom Trust. The Kingdom Trust is a Cayman Islands trust, for the benefit of HRH and his family. Under the terms of The Kingdom Trust, HRH has the power to appoint a majority of the directors of KR-132 and, through this power, has the power to appoint a majority of the directors of Kingdom Hotels. HRH is the sole director of Kingdom Hotels. Kingdom Hotels, through its wholly-owned subsidiaries, Kingdom 5-KR-5 Ltd. and Kingdom Holdings, Inc., both of which are Barbados corporations, has the ability to appoint a majority of the board of directors of Kingdom Investments. The directors of Kingdom Investments are Saleh Al Ghoul (whose business address is c/o Kingdom Holding Company, Kingdom Centre, Floor 66, P.O. Box 2, Riyadh, 11321, Kingdom of Saudi Arabia), Charles S. Henry (whose business address is c/o Hotel Capital Advisers, Inc., 60 East 42nd Street, Suite 962, New York, NY 10165) and Oswald H.D. O’Sehmo (whose business address is Worthing Corporate Centre, Worthing Main Road, Christ Church BB15008, Barbados). Kingdom Investments is managed by its board of directors and has one executive officer, Mr. Henry, who is its president.

As described under Item 4, on November 3, 2006, Kingdom Hotels entered into an agreement with Isadore Sharp, the Chairman of the Board, Chief Executive Officer and controlling shareholder of the Issuer, Triples Holdings Limited, which is Mr. Sharp’s family holding company (“Triples”), and Cascade Investment L.L.C., which is a private investment entity owned by William H. Gates, III (“Cascade”) pursuant to which they have agreed to jointly pursue the acquisition of the Issuer. As a result of this agreement, the Reporting Persons, Mr. Sharp, Triples and Cascade may be deemed to have formed a “group” within the meaning of Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 13d-5(b)(1) promulgated thereunder.

Item 3.

Source and Amount of Funds or Other Consideration

Kingdom Investments has owned the Limited Voting Shares since 1994 and originally acquired those securities with its own funds through a tender offer and by purchase from Triples. For information with respect to the funding of the proposed acquisition of all the outstanding Limited Voting Shares, please see Item 4 of this Schedule 13D.

Item 4.

Purpose of Transaction

On November 3, 2006, Kingdom Hotels, Mr. Sharp, Triples and Cascade (together, the “Investors”) entered into a Funding and Cooperation Agreement, pursuant to which (i) the Investors agreed to submit a proposal regarding, and cooperate with respect to, the proposed acquisition of the Issuer (the “Proposal”), (ii) the Investors agreed to contribute a total of 8,105,032 Limited Voting Shares and 3,725,698 Variable Multiple Voting Shares of the Issuer to the acquiring entity, (iii) Cascade and Kingdom Hotels agreed to provide funds for the Proposal, (iv) the Investors agreed that all decisions regarding the Proposal shall be made jointly by Cascade and Kingdom Hotels, (v) the Investors agreed to certain governance arrangements if the transactions

contemplated by the Proposal are completed, (vi) the Investors agreed to share certain expenses incurred in connection with the Proposal and (vii) the Investors agreed to not pursue an acquisition of the Issuer, other than pursuant to the Funding and Cooperation Agreement, during the term of the Funding and Cooperation Agreement and for a period of 12 months thereafter. The Funding and Cooperation Agreement is terminable on the earliest of December 31, 2006 (unless an acquisition agreement is executed and delivered on or before such date), termination of the acquisition agreement, completion of the transactions contemplated by the Proposal and notice by either Kingdom Hotels or Cascade before execution and delivery of the acquisition agreement. The description of the terms of the Funding and Cooperation Agreement contained herein is a summary only and is qualified in its entirety by the terms of the Funding and Cooperation Agreement, which is filed as Exhibit 99.1 to this Schedule 13D and is incorporated herein by reference.

By letter dated November 3, 2006, the Investors submitted to the Issuer a proposal (the “Proposal Letter”) to acquire all outstanding Limited Voting Shares of the Issuer for a cash purchase price of $82.00 per share (other than shares owned by Kingdom Investments and Cascade). Under the terms of the Proposal Letter, the acquisition would be implemented through a shareholder approved corporate transaction. Under the Proposal, Mr. Sharp would continue to direct all aspects of the day-to-day operations and strategic direction of the Issuer as Chairman of the Board and Chief Executive Officer. Each of Kingdom Investments, Triples and Cascade would reinvest their existing equity in the Issuer, representing a total rollover of approximately $970 million based on the proposed transaction price. In addition to this equity rollover, the transaction would be financed through a combination of (i) $750 million new debt financing, which would be used in part to repay the existing convertible debt of the Issuer and (ii) approximately $1.87 billion of equity (after taking into account available cash of the Issuer) that would be provided by Kingdom Hotels and Cascade (either directly or through affiliated entities). It is currently anticipated that Kingdom Hotels will contribute approximately $0.66 billion in cash. The Proposal Letter is non-binding and the transaction would be subject to customary conditions, including shareholder approval, and filings under Canadian, U.S. and other competition and other laws. The description of the terms of the Proposal Letter contained herein is a summary only and is qualified in its entirety by the terms of the Proposal Letter, which is filed as Exhibit 99.2 to this Schedule 13D and is incorporated herein by reference.

The Proposal could result in one or more of the actions specified in clauses (a)-(j) of Item 4 of Schedule 13D, including the acquisition or disposition of additional securities of the Issuer, a merger or other extraordinary transaction involving the Issuer, a change to the present board of directors of the Issuer, a change to the present capitalization or dividend policy of the Issuer, the delisting of the Issuer’s securities from the Toronto Stock Exchange and New York Stock Exchange, and the causing of a class of equity securities of the Issuer to become eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act. One or more of the Reporting Persons are expected to take actions in furtherance of the Proposal or any amendment thereof.

The Reporting Persons may at any time, or from time to time, acquire additional Limited Voting Shares or dispose of their Limited Voting Shares; pursue, or choose not to pursue, the Proposal; change the terms of the Proposal Letter, including the price, conditions, or scope of the transaction; otherwise seek control or seek to influence the management and policies of the Issuer; or change their intentions with respect to any such matters.

Item 5.

Interest in Securities of the Issuer

As of the date of this Schedule 13D, Kingdom Investments owned 7,389,182 Limited Voting Shares which represents, based upon 33,068,378 outstanding Limited Voting Shares, approximately 22% of the outstanding Limited Voting Shares. 1/

HRH, through his ability as sole director of Kingdom Hotels, directly or indirectly, to appoint a majority of the directors of Kingdom Investments, has the sole power to vote or direct the vote, and the sole power to dispose or direct the disposition of the 7,389,182 Limited Voting Shares of the Issuer, and as a result is deemed, for U.S. securities law purposes, to be the beneficial owner of such securities. HRH also may be deemed the beneficial owner, for U.S. securities law purposes, of an additional 179,322 Limited Voting Shares, in which he shares voting and dispositive powers. However, such 179,322 shares are not subject to the terms of the Funding and Cooperation Agreement or the Proposal Letter.

_________________________

¹Based on 33,068,378 Limited Voting Shares outstanding as reported in the Issuer’s Form 6-K for the quarter ended June 30, 2006.

Mr. Sharp has advised the Reporting Persons that Triples is the beneficial owner of 3,725,698 Variable Multiple Voting Shares of the Issuer, which represents 100% of the outstanding Variable Multiple Voting Shares.

Cascade has advised the Reporting Persons that Cascade is the beneficial owner in the aggregate of 715,850 Limited Voting Shares, which represents approximately 2% of the outstanding Limited Voting Shares.

Each Limited Voting Share entitles the holder to one vote. Each Variable Multiple Voting Share currently entitles the holder to that number of votes that results in the aggregate votes attaching to the Variable Multiple Voting Shares, representing approximately 64.55% of the votes attaching to the Variable Multiple Voting Shares and the Limited Voting Shares, in the aggregate.

Accordingly, in the aggregate, the Reporting Persons, Mr. Sharp, Triples and Cascade beneficially own (i) 8,284,354 Limited Voting Shares, which represents approximately 25% of the outstanding Limited Voting Shares and (ii) 3,725,698 Variable Multiple Voting Shares. The aggregate voting power of the Limited Voting Shares and Variable Multiple Voting Shares beneficially owned by the Reporting Persons, Mr. Sharp and Cascade is approximately 73% of the combined voting power of the Limited Voting Shares and Variable Multiple Voting Shares.

Each Reporting Person hereby disclaims beneficial ownership of any securities of the Issuer that may be, or are beneficially owned by, Mr. Sharp, Triples or Cascade.

The Reporting Persons have not effected any transactions in the securities of the Issuer during the past 60 days.

Except as set forth in this Schedule 13D, to the knowledge of the Reporting Persons, no person has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, securities covered by this Schedule 13D.

Item 6.

Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer

Other than as described in this Item 6 and in Items 4 and 5 above, and in the documents incorporated herein by reference and set forth as exhibits hereto, there are no contracts, arrangements, understandings or relationships (legal or otherwise) among the persons named in Item 2 and between such persons and any persons with respect to any securities of the Issuer, including, but not limited to, transfer or voting of any of the securities, finder’s fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or less, or the giving or withholding of proxies.

1994 Shareholders Agreement

On September 26, 1994, HRH, Kingdom Investments, Mr. Sharp and Triples entered into a Shareholders Agreement. The Shareholders Agreement provides that Triples and Mr. Sharp will use their best efforts to support the election of two nominees of Kingdom Investments to the board of directors of the Issuer and to cause each committee of such board to include at least one director nominated by Kingdom Investments. In addition, Triples and Mr. Sharp have agreed to use their voting power to ensure that the Issuer’s shareholders do not approve any of the following actions unless they have been approved previously by Kingdom Investments: (i) any decision to wind up, dissolve or liquidate the Issuer’s business; (ii) any plan of arrangement of the Issuer; (iii) the sale of all or substantially all of the assets of the Issuer; (iv) any change in the auditors of the Issuer; (v) a merger or amalgamation of the Issuer; and (vi) any change in the charter or the bylaws of the Issuer.

The Shareholders Agreement also prohibits (subject to limited exceptions) Triples, Mr. Sharp and permitted Sharp transferees (as such term is defined in the Shareholders Agreement) from selling or transferring any securities of the Issuer without first offering those securities to Kingdom Investments. In the event that Triples, Mr. Sharp or a permitted Sharp transferee offers to sell more than 50% of their Variable Multiple Voting Shares and Kingdom Investments exercises its right to purchase such shares, Kingdom

Investments may, concurrently therewith, offer to acquire the remaining Variable Multiple Voting Shares and make a tender offer for all issued and outstanding Limited Voting Shares. If Triples, Mr. Sharp or a permitted Sharp transferee makes an offer to sell their securities of the Issuer to a third party, Kingdom Investments has the right, at its sole option, to require that a proportionate amount of its Issuer’s securities be included in such third party offer.

The Shareholders Agreement is terminable upon (i) the agreement in writing of all parties, (ii) HRH, Kingdom Investments or their permitted assignees ceasing to own at least 10% of the issued and outstanding Limited Voting Shares (except as a result of the issuance of additional Limited Voting Shares by the Issuer) or (iii) Triples and permitted Sharp transferees ceasing to own securities with more than 50% of the voting rights of all voting securities of the Issuer.

The description of the terms of the Shareholders Agreement contained herein is a summary only and is qualified in its entirety by the terms of the Shareholders Agreement, which is filed as Exhibit 99.3 to this Schedule 13D and is incorporated herein by reference.

Confidentiality Agreement

On November 4, 2006, Kingdom Hotels entered into a letter agreement (the “Confidentiality Letter Agreement”) pursuant to which Kingdom Hotels agreed to certain confidentiality and related undertakings with respect to confidential information provided by the Issuer to Kingdom Hotels. A copy of such letter agreement is filed as Exhibit 99.4 to this Schedule 13D and is incorporated by reference into this Item 6.

Item 7.

Material to be Filed as Exhibits

Exhibit Number
99.1	Funding and Cooperation Agreement, dated November 3, 2006, by and among Kingdom Hotels International, Isadore Sharp, Triples Holdings Limited and Cascade Investment, L.L.C.
99.2	Letter, dated November 3, 2006, to Four Seasons Hotels Inc. from Kingdom Hotels International, Isadore Sharp, Triples Holdings Limited and Cascade Investment, L.L.C.
99.3	Shareholders Agreement, dated September 26, 1994, by and among HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud, Kingdom Investments, Inc., Isadore Sharp and Triples Holdings Limited, as amended by Amendment No.1 in 1997.
99.4	Confidentiality Agreement, dated November 4, 2006, between Kingdom Hotels International and the Four Seasons Hotels Inc.

Signature

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.


	/s/ HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud_
	HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud

	KINGDOM INVESTMENTS, INC.

	By: /s/ Charles S. Henry
	Name: Charles S. Henry
	Title: President

Dated:

November 6, 2006

EX-99 2 sc13dex9911110606.htm FUNDING AND COOPERATION AGREEMENT

FUNDING AND COOPERATION AGREEMENT

FUNDING AND COOPERATION AGREEMENT (this “Agreement”), dated as of November 3, 2006, by and among Kingdom Hotels International, a Cayman Islands company (“Kingdom”), Cascade Investment, L.L.C., a Washington limited liability company (“Cascade” and, together with Kingdom, the “Lead Investors”), Triples Holdings Limited, an Ontario corporation (“Triples” and, together with the Lead Investors, the “Investors”), and Isadore Sharp (“Sharp” and, together with Triples, the “Sharp Parties”; the Sharp Parties and the Lead Investors are referred to herein as the “Parties”).

R E C I T A L S:

WHEREAS, the Lead Investors (or their affiliates) and Triples currently are shareholders of Four Seasons Hotels Inc. (the “Company”) and Sharp is Chairman and CEO of the Company;

WHEREAS, the Lead Investors have proposed to the Sharp Parties that the Parties make a joint proposal to acquire all of the outstanding capital stock of the Company, other than shares held by the Parties and certain of their respective affiliates (the “Acquisition”), and the Sharp Parties have informed the Lead Investors that they are willing to join in such proposal;

WHEREAS, the Parties wish to agree to certain terms and conditions relating to the funding of the Acquisition and their relationship in connection with their joint pursuit of the Acquisition;

NOW, THEREFORE, in consideration of the premises and the mutual promises set forth herein, the Parties agree as follows:

1. Proposal. The Parties hereby agree, on the terms and subject to the conditions contained herein, to jointly pursue the Acquisition of the Company. The Parties agree that the Lead Investors shall submit a proposal letter on behalf of all of the Parties relating to the Acquisition in the form approved by each of the Parties (the “Proposal”). In connection with the Proposal, the Lead Investors shall cause a Canadian entity (the “Acquiror”) to be formed as the acquisition vehicle.

2. Cooperation in Completing Proposal and Acquisition. If the Board of Directors of the Company approves the Proposal, the Parties agree to cooperate to negotiate and finalize an acquisition or similar agreement with the Company (the “Acquisition Agreement”), the Shareholders’ Agreement (as defined below), the Acquisition Credit Facility (as defined below) and all of the other agreements and arrangements among the Parties required to be finalized prior to the closing (the “Closing”) under the Acquisition Agreement (collectively, the “Transaction Agreements”), each of which shall reflect the terms set forth herein and in the Proposal and otherwise be in a form acceptable to each of the Parties. Subject to Paragraph 6 below, (i) each Party shall take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other Parties in doing, all things reasonably necessary, proper or advisable to cause Acquiror to perform and comply with all agreements and covenants required to be performed by Acquiror under the Transaction Agreements and to cause Acquiror to consummate the Acquisition and other transactions contemplated by the Transaction Agreements and (ii) none of the Parties shall take any action that results in a breach or violation by Acquiror of the Transaction Agreements.

3. Source of Funds. The Parties contemplate that the cash required to complete the Acquisition and other transactions contemplated by the Transaction Agreements and to pay related expenses will be funded by the proceeds of borrowings to be made under a US$750.0 million credit facility that the Acquiror will enter into at Closing (the “Acquisition Credit Facility”), which will be assumed by the Company upon completion of the Acquisition, and by cash equity contributions by the Lead Investors, as provided in Paragraph 4 below.

4. Equity Contributions. Each of the Lead Investors and Triples hereby agrees to contribute to Acquiror, concurrently with the Closing and subject to satisfaction or waiver of the conditions to closing to be set forth in the Acquisition Agreement, all of the shares of capital stock in the Company owned by such Party, free and clear of all liens and encumbrances, and cash, in each case as set forth below.

(a) Kingdom shall contribute (or cause a wholly owned subsidiary to contribute) 50% of the Required Common Equity (as defined below), consisting of the 7,389,182 Limited Voting Shares of the Company currently held by Kingdom Investments, Inc., valued at the price paid to public shareholders pursuant to the Acquisition Agreement (the “Acquisition Price”), plus an amount of cash equal to 50% of the Required Common Equity less the value of such contributed Limited Voting Shares, in exchange for 50% of the Series A Limited Voting Shares of Acquiror.

(b) Cascade shall contribute 50% of the Required Common Equity, consisting of 715,850 Limited Voting Shares of the Company, valued at the Acquisition Price, plus an amount of cash equal to 50% of the Required Common Equity less the value of such contributed Limited Voting Shares, in exchange for 50% of the Series A Limited Voting Shares of Acquiror.

(c) Triples shall contribute 3,725,698 Variable Multiple Voting Shares of the Company, valued at the Acquisition Price, in exchange for 3,725,698 Variable Multiple Voting Shares of Acquiror. The Variable Multiple Voting Shares of Acquiror shall be in two series and shall have the conversion, dividend, redemption, voting, and other rights described in the term sheet attached as Annex A hereto (the “Term Sheet”).

As used herein, the term “Required Common Equity” shall mean a dollar amount equal to (i) the total amounts required (A) to acquire all outstanding capital stock of the Company, (B) to pay the principal, all accrued interest and premium and any other amounts incurred to redeem, repurchase or otherwise retire the convertible debt of the Company, (C) to make all payments due to Sharp under the Sale of Control Agreement between the Company and Sharp, and (D) to pay all expenses paid by the Company in connection with the Acquisition, less (ii) the Company’s available cash at the time of Closing, less (iii) the proceeds available at Closing under the Acquisition Credit Facility and less (iv) the value (based on the Acquisition Price) of the number of Variable Multiple Voting Shares contributed to Acquiror by Triples as described above.

Guaranty of Acquisition Agreement.

(a) To the extent required in connection with negotiation of the Acquisition Agreement, each Lead Investor shall provide a several guaranty (each a “Guaranty”) directly to the Company of 50% of Acquiror’s obligations under the Acquisition Agreement. The liability of each Lead Investor under such Guaranty shall be capped at an amount acceptable to the Lead Investors.

(b) The Parties shall cooperate in defending any claim that the Lead Investors are, or any one of them is, liable to make payments under the Guaranties. Each Investor agrees to contribute to the amount paid or payable by the Lead Investors in respect of the Guaranties so that each Party shall have paid an amount equal to the product of the aggregate amount paid under all of the Guaranties multiplied by the following percentages: Kingdom, 47.5%; Cascade, 47.5%; and Triples, 5%; provided that no Lead Investor shall be entitled to receive any contribution payments if such Lead Investor’s liability under its Guaranty arose by reason of a breach by such Lead Investor of its obligations hereunder or under any Transaction Agreement.

6. Decisions Relating to Proposal and Acquisition Agreement. All decisions with respect to the Proposal, the Acquisition Agreement and the Acquisition Credit Facility shall be made jointly by the Lead Investors, including any decision (i) to modify the Proposal, (ii) to enter into the Acquisition Agreement or the Acquisition Credit Facility, (iii) to amend, modify or waive any term or condition of the Acquisition Agreement or the Acquisition Credit Facility, (iv) to terminate the Acquisition Agreement or the Acquisition Credit Facility in accordance with its terms (except as provided in the following sentence) and (v) as to whether the conditions in the Acquisition Agreement or the Acquisition Credit Facility have been satisfied. If either Lead Investor determines that there is a right to terminate the Acquisition Agreement pursuant to the terms thereof (including because of a failure of a condition), and if such Lead Investor desires to terminate the Acquisition Agreement as a result thereof, such Lead Investor may notify the other of such desire and the Lead Investors shall take all necessary action to terminate the Acquisition Agreement; provided, however, that if the other Lead Investor (the “continuing Lead Investor”) desires to consummate the Acquisition Agreement without any involvement by the Lead Investor desiring to terminate the Acquisition Agreement (the “withdrawing Lead Investor”), and the Sharp Parties agree to proceed with the Proposal on such basis, then the continuing Lead Investor and the withdrawing Lead Investor shall cooperate in such reasonable arrangements requested by the other to permit the continuing Lead Investor to proceed with the Acquisition and to terminate any liability or obligation of the withdrawing Lead Investor. Without limiting the generality of the foregoing, the continuing Lead Investor shall be required to assume the withdrawing Lead Investor’s obligations under its Guaranty referred to in Paragraph 5 above.

7. Post-Closing Governance Arrangements. Prior to or concurrently with the Closing, (i) each of the Parties shall enter into a shareholders agreement containing provisions for the post-closing governance of the Company and other arrangements regarding their ownership of shares of the Company after completion of the Acquisition (the “Shareholders Agreement”) and (ii) Sharp shall enter into, and the Lead Investors shall cause the Company to enter into, an employment agreement between Sharp and the Company, in each case on substantially the terms set forth in the Term Sheet and as otherwise agreed by the Parties.

8. Exclusivity. During the term of this Agreement and for twelve months thereafter if this Agreement terminates other than pursuant to clause (ii) of Paragraph 11, no Party shall, directly or indirectly, through any officer, director, employee, affiliate, attorney, financial advisor or other person, agent or representative, seek to acquire or acquire, or encourage or participate in any other acquisition of or proposal to acquire, capital stock of the Company that would result in such person or Party (together with any other person or Party participating in such offer or acquisition) holding more than 40% of the capital stock of the Company or all or any substantial portion of the assets of the Company, except as contemplated hereby (including Paragraph 6) or with the consent of both Lead Investors, such consent not to be unreasonably withheld; provided that the foregoing shall not restrict any person who is a director of the Company from complying with the fiduciary duties owed by such person to the Company.

9. Regulatory Matters. Each Party shall use commercially reasonable efforts to supply and provide information that is accurate in all material respects to any governmental authority requesting such information in connection with filings or notifications under, or relating to, Antitrust and Investment Laws (as defined below). If any governmental authority asserts any objections under any applicable antitrust, competition, foreign investment or fair trade laws (collectively, the “Antitrust and Investment Laws”) with respect to the Acquisition and such objections relate to the activities or investments of a Party or such Party’s affiliates, such Party shall attempt to resolve such objections; provided no Party or any affiliate of a Party shall be required to dispose of any assets or enter into any agreements that materially restrict the activities of such Party or its affiliates as a condition of resolving any such objections under the Antitrust and Investment Laws; provided, further if any Party is unable to resolve the objections of any governmental authority related to the activities or investments of a Party or such Party’s affiliates under the Antitrust and Investment Laws, then such Party shall be responsible for all Pursuit Costs (as defined below).

10.

Sharing of Expenses; Other Matters.

(a) Except as provided in Paragraph 9, if the Acquisition is not consummated for any reason, all reasonable out-of-pocket expenses (including legal fees and expenses) incurred after the date of this Agreement by any Party (other than a Party that has committed a material breach of its obligations hereunder) or any such non-breaching Party’s affiliates (including any Acquiror) in connection with the Proposal, the Acquisition and the related transactions (“Pursuit Costs”) shall be shared among the Parties as follows: Kingdom, 47.5%; Cascade, 47.5%; and the Sharp Parties, 5%. Each Party shall make such payments to the others as shall be necessary to implement such sharing of expenses. Any “break up fees” or other amounts received from the Company and any amounts received from the Company as a result of a breach of the Acquisition Agreement by the Company shall be shared among the Lead Investors and Triples according to the following percentages: Kingdom, 47.5%; Cascade, 47.5%; and the Sharp Parties, 5%.

(b) If the Closing occurs, then the Acquiror shall reimburse the Parties and their respective affiliates for all Pursuit Costs incurred by each of them.

11. Termination. This Agreement shall become effective on the date hereof and shall terminate (except with respect to Paragraphs 8, 10(a) (but only with respect to Pursuit Costs incurred prior to termination) and 12 through 23 and this Paragraph 11, each of which shall survive any such termination) upon the earliest of (i) December 31, 2006, unless the Acquisition Agreement shall have been executed and delivered on or before such date, (ii) the Closing, (iii) the termination of the Acquisition Agreement and (iv) notice delivered by either Lead Investor to the other Parties prior to execution and delivery of an Acquisition Agreement. Termination of this Agreement shall not relieve any Party of any liability for breach of this Agreement prior to such termination.

12. Entire Agreement. This Agreement constitutes the entire agreement, and supersedes all prior agreements, understandings, negotiations and statements, both written and oral, among the Parties or any of their affiliates with respect to the subject matter contained herein.

13. Confidentiality. Each Party agrees to, and shall cause its affiliates (other than the Company), directors, officers, employees, agents, advisors and representatives (“Representatives”) to, keep any information supplied by or on behalf of any of the other Parties to this Agreement in connection with the transactions contemplated hereby confidential (“Confidential Information”) and to use, and cause its Representatives to use, the Confidential Information only in connection with the Proposal, the Acquisition, and the other transactions contemplated hereby; provided that the term “Confidential Information” does not include information that (a) is already in such Party’s possession, provided that such information is not subject to another confidentiality agreement with or other obligation of secrecy to any person, (b) is or becomes generally available to the public other than as a result of a disclosure, directly or indirectly, by such Party or such Party’s Representatives in breach of this Agreement, or (c) is or becomes available to such Party on a non-confidential basis from a source other than any of the Parties hereto or any of their respective Representatives, provided that such source is not known by such Party to be bound by a confidentiality agreement with or other obligation of secrecy to any person; provided further that that nothing herein shall prevent any Party from disclosing Confidential Information (i) upon the order of any court or administrative agency, (ii) upon the request or demand of any regulatory agency or authority having jurisdiction over such Party, (iii) to the extent required by law or regulation, (iv) to the extent necessary in connection with the exercise of any remedy, hereunder, and (v) to such Party’s Representatives that need to know such information (it being understood and agreed that, in the case of clause (i), (ii) or (iii), such Party shall notify the other Parties hereto of the proposed disclosure as far in advance of such disclosure as practicable and use reasonable efforts to ensure that any information so disclosed is accorded confidential treatment, when and if available). Notwithstanding anything to the contrary, nothing in this Agreement shall impose on any Party or any other Person a limitation on the disclosure of the tax treatment or tax structure of any transaction set forth herein.

14. Public Announcements. Each Party shall coordinate in good faith any and all press releases and other public announcements with respect to the Proposal, the Acquisition, and the other transactions contemplated hereby; provided that, without the consent of all of the Parties, no such press releases or public announcements shall contain information materially different from information contained in press releases or other public announcements previously made by the Company. This provision shall not apply, however, to any public announcement or written statement required to be made by law or the regulations of any governmental authority or any stock exchange, except that the Party required to make such announcement shall, whenever practicable, consult with the other Parties concerning the content and timing of such announcement before such announcement is made.

15. Third Party Beneficiaries. No person (including the Company) other than the Parties and their respective successors and permitted assigns shall have any rights hereunder.

16. Remedies. The Parties hereto agree that, except as provided herein, this Agreement shall be enforceable by all available remedies at law or in equity (including specific performance).

17. Exercise of Rights and Remedies. No delay of or omission in the exercise of any right, power or remedy accruing to any Party as a result of any breach or default by any other Party under this Agreement shall impair any such right, power or remedy, nor shall it be construed as a waiver of or acquiescence in any such breach or default, or of any similar breach or default occurring later; nor shall any such delay, omission or waiver of any single breach or default be deemed a waiver of any other breach or default occurring before or after that waiver.

18. No Recourse. Notwithstanding anything that may be expressed or implied in this Agreement, and notwithstanding the fact that certain of the Investors may be partnerships or limited liability companies, each Party covenants, agrees and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement shall be had against any former, current or future directors, officers, agents, affiliates, general or limited partners, members, managers or stockholders of any Investor or any former, current or future directors, officers, agents, affiliates, employees, general or limited partners, members, managers or stockholders of any of the foregoing, as such, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any current or future director, officer, employee, general or limited partner or member or manager of any Investor or of any partner, member, manager or affiliate thereof, as such, for any obligation of any Investor under this Agreement or any documents or instruments delivered in connection with this Agreement for any claim based on, in respect of or by reason of such obligations or their creation.

19. Governing Law; Jurisdiction. This Agreement shall be enforced, construed and interpreted in accordance with the laws of the State of New York. Each of the Parties (i) consents to submit itself to the personal jurisdiction of any state or federal court located in the Borough of Manhattan, State of New York with respect to any action arising from this Agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (iii) agrees not to commence any such action in any forum other than such court. The Parties irrevocably and unconditionally waive any objection to the laying of venue of any such action in any such state or federal court, and hereby further irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such action brought in any such court has been brought in an inconvenient forum. Each of the Parties, to the fullest extent permitted by applicable law, waives any right to a jury trial in any such action

20. No Assignment. This Agreement may not be assigned by any Party, nor shall any Party syndicate its contribution obligation, without the consent of the other Parties, other than to an affiliate of such Party, it being agreed that any such assignment shall not relieve the assigning Party from its obligations hereunder.

21. Amendments. This Agreement may not be amended or modified orally, but only by a written instrument signed by all of the Parties.

22. No Representations or Duty. (a) Each Party specifically understands and agrees that no other Party has made and will not make any representation or warranty with respect to the terms, value or any other aspect of the transactions contemplated hereby and each Party explicitly disclaims any warranty, express or implied, with respect to such matters. In addition, each Party specifically acknowledges, represents and warrants that it is not relying on any other Party (i) for its due diligence concerning, or evaluation of, the Company or its assets or businesses, (ii) for its decision with respect to making any investment contemplated hereby or (iii) with respect to tax and other economic considerations involved in such investment.

(b) In making any determination contemplated by this Agreement, each Party may make such determination in its sole and absolute discretion, taking into account only such Party’s own views, self-interest, objectives and concerns. No Party shall have any fiduciary or other duty to any other Party except as expressly set forth in this Agreement.

23. Counterparts; Facsimile Signatures. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. For purposes hereof, facsimile signatures shall be binding on the Parties to this Agreement.

IN WITNESS WHEREOF, the Parties have executed this Funding and Cooperation Agreement by their duly authorized officers as of the date first written above.

	KINGDOM HOTELS INTERNATIONAL
	By: Name: Title:		/s/ HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud HRH Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud President
	CASCADE INVESTMENT, L.L.C.
	By: Name: Title:		/s/ Michael Larson Michael Larson Business Manager
	TRIPLES HOLDINGS LIMITED
	By: Name: Title:		/s/ Isadore Sharp Isadore Sharp President

	By:		/s/ Isadore Sharp Isadore Sharp

ANNEX A

Transaction Summary

A.	Transaction Overview

The following summarizes certain terms of the transaction (the “Transaction”) contemplated by the Funding and Cooperation Agreement to which this Transaction Summary is attached. Certain capitalized terms used in this Transaction Summary have the meanings ascribed to them in that Agreement.

1. Consideration per Share:	US$82.00 cash per share (the “Transaction Price”).

2. Triples/Sharp Interest:	(i) Mr. Sharp would be entitled to receive the proceeds due under the Sharp Sale of Control Agreement, estimated to be approximately US$288 million. (ii) Triples would hold all of Acquiror’s Variable Multiple Voting Shares (“VMVS”) , as described below. (The terms “Acquiror” and “Four Seasons” are used interchangeably herein, unless the context requires otherwise.) (iii) The terms of the VMVSwould be amended to provide that: § Two Series: The VMVS would be issued in two series. The first series (“Series A VMVS”) would be convertible into Preferred Shares on the terms and conditions described below. The number of Series A VMVS would equal the total number of VMVS currently held by Triples less the number of Series B VMVS issued in the Transaction. The second series of VMVS (“Series B VMVS”) would be convertible into Series B Limited Voting Shares of Four Seasons on the terms and conditions described below. The number of Series B VMVS would be equal to 1/19^th times the total number of Series A Limited Voting Shares of Four Seasons held by Kingdom and Cascade following the Transaction (i.e., such that upon conversion of the Series B VMVS into Series B Limited Voting Shares, Triples would hold 5% of the aggregate Series A and B Limited Voting Shares). § Regular Voting: Except with respect to Special Matters¹, both series of VMVS would entitle the holder to one vote per share, voting together with the Limited Voting Shares as one class.

¹The Special Matters would be those Material Decisions identified in items 1, 3, 7, 13, 14 and 16 of Part C that would require the approval of Mr. Sharp/Triples so long as none of the Series B VMVS had been transferred outside the Sharp family and Mr. Sharp was either the Chief Executive Officer or the Chairman of the Company (and provided that he was not physically incapacitated or mentally incompetent).








	§ Conversion of Series A VMVS to Preferred Shares: The Series A VMVS would be convertible, into preferred shares with the terms described below (“Preferred Shares”) on a 1:1 basis (i) at any time at the option of the holder, (ii) at any time on or following the fifth anniversary date of closing of the Transaction at the option of Four Seasons, (iii) automatically upon Mr. Sharp dying, becoming physically incapacitated or mentally incompetent, or if he was neither the Chief Executive Officer nor the Chairman (other than as a result of a breach by a party other than Mr. Sharp of agreements relating to Mr. Sharp’s tenure in those positions), and (iv) automatically upon the completion of a public offering of voting or equity securities of Four Seasons that had been approved as a Material Decision and following which Four Seasons was listed on an internationally recognized stock exchange.² § Conversion of Series B VMVS to Series B Limited Voting Shares by Holder or by Company: The Series B VMVS would be convertible into Series B Limited Voting Shares on a 1:1 basis (i) at any time at the option of the holder, (ii) automatically upon the transfer of any Series B VMVS outside the Sharp family, upon Mr. Sharp dying, becoming physically incapacitated or mentally incompetent, or if he was neither the Chief Executive Officer nor the Chairman (other than as a result of a breach by a party other than Mr. Sharp of agreements relating to Mr. Sharp’s tenure in those positions), and (iii) at the option of the Company upon the completion of a public offering of voting or equity securities of Four Seasons that had been approved as a Material Decision and following which Four Seasons was listed on an internationally recognized stock exchange.³ § Voting on Special Matters: In respect of Special Matters only, the two series of VMVS would, as a single class, entitle the holder to the lesser of their then current multiple votes (as calculated on the basis of the currently authorized VMVS of Four Seasons) and that number of the votes that, in aggregate, is 25% of the votes attaching to all outstanding securities of Four Seasons, and would vote as a separate class from the Limited Voting Shares. § Dividends: The Series B VMVS would entitle the holder to the same dividends as are paid on the Limited Voting Shares. No dividends would be paid on the Series A VMVS.




²Among other things, the terms of the Preferred Shares could permit Four Seasons to cause those shares to be purchased by a third party for the Redemption Price in place of their being redeemed by Four Seasons. ³This conversion of the VMVS would result in the Special Matters requiring the approval of Mr. Sharp, as provided under “Material Decisions”.









	(iv) The Preferred Shares would have a “face value” per share equal to the Transaction Price and would entitle the holder to cumulative, compound dividends (accruing from the date of closing of the Transaction) at a rate equal to 9.9% per annum. No dividends would be paid on the Preferred Shares until the end of the fifth year after the date of closing of the Transaction (or, if later, the issuance of the Preferred Shares upon conversion of the Series A VMVS), at which time dividends would begin to be paid on a current basis. One-third of the dividends accrued and compounded before the fifth anniversary of the date of closing of the Transaction would be paid at the end of each of the fifth, sixth and seventh years after the date of closing of the Transaction (with unpaid dividends continuing to compound to the date of such payment). The Preferred Shares would be redeemable for their face value and accrued but unpaid dividends to the date of redemption (i) at the option of the holder or Four Seasons at any times beginning on the fifth anniversary of the date of closing the Transaction, provided that at the end of the sixth and seventh years after the date of closing the Transaction, respectively, no more than one-third and two-thirds of the maximum number of Preferred Shares into which the Series A VMVS may be converted (regardless of the number of Preferred Shares actually issued) shall have been redeemed, (ii) at the option of the holder at any time if Mr. Sharp ceased to be either the Chief Executive Officer or the Chairman as a result of a breach by a party other than Mr. Sharp of agreements relating to Mr. Sharp’s tenure in those positions, and (iii) in whole at the option of Four Seasons if, beginning on the fifth anniversary of the date of closing of the Transaction, the holder did not consent to Four Seasons or its subsidiaries incurring indebtedness for borrowed money that had been approved as a “Material Decision” (as provided in Part C, below). While all or any portion of the Preferred Shares remain outstanding, no indebtedness for borrowed money that was not subordinated to the Preferred Shares could be incurred by Four Seasons or its subsidiaries without Mr. Sharp’s consent. (Mr. Sharp would pre-approve the debt associated with the implementation of the Transaction, up to US$750 million of acquisition financing and a US$200 million evergreen operating facility with one or more banks, as “permitted senior debt”.) The final structure would address the commercial and tax efficiencies associated with achieving the overall economic objective of the Transaction.

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3. Commitment of Chairman and Chief Executive Officer:	Mr. Sharp would agree to continue in his current capacity as Chief Executive Officer for at least three years. Thereafter, at his option, Mr. Sharp would advise the Board of Directors regarding further extensions of his service as Chief Executive Officer. Mr. Sharp would continue as the Chairman while he is Chief Executive Officer and, at his option, after he ceases to be Chief Executive Officer. Mr. Sharp would tender his resignation as Chief Executive Officer and Chairman if Mr. Sharp/Triples disposed of all or substantially all of their equity interest in Four Seasons (other than pursuant to a pro rata secondary public offering or private placement by Mr. Sharp/Triples and the Lead Investors participating in the offering). The continuing Chief Executive Officer and Chairman’s roles contemplated for Mr. Sharp are outlined in Part B, below.

4. Governance:	The governance structure for Four Seasons would be established pursuant to a shareholders agreement among Four Seasons, the Lead Investors, Mr. Sharp and Triples. The basic terms of the shareholders agreement are outlined in Part C, below.

5. Mechanism for Implementation:	It is contemplated that the Transaction would be implemented through a shareholder-approved corporate transaction, such as an amalgamation or a plan of arrangement approved by shareholders and the court.

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11-3-06

Position Description of Chief Executive Officer and Chairman of the Board

CHIEF EXECUTIVE OFFICER

General

As Chief Executive Officer, Mr. Sharp would continue to have responsibility for providing the strategic and aesthetic vision for Four Seasons and overseeing the day-to-day management of the business of the Company in accordance with its strategic plans and annual budgets as reviewed and, as necessary, approved by the Board.

Specific Responsibilities

Without limitation, as Chief Executive Officer, Mr. Sharp would have responsibility, as currently is the case, to:

•	lead the strategic planning process for Four Seasons,

•	subject to the Material Decisions list, lead succession planning and personnel related initiatives for Four Seasons,

•	with other members of senior management, advise the Board of the goals for Four Seasons’ business and, oversee the implementation of corresponding strategic, operational and profit plans,

•	advise on the development and implementation of the activities of Four Seasons to achieve agreed-upon targets,

•	report to, and meet periodically with, the Board to review material issues,

•	arrange for the provision to the Board of all information reasonably required by the Board, and

•	subject to the Material Decisions list, implement top-level organizational structure, staffing, compensation and succession in a manner consistent with current succession plans and recommend to the Board any changes thereto.

Management Style

Mr. Sharp would discharge his role as Chief Executive Officer in a manner consistent with past practice and, without limitation, would:

•	focus his time on significant business issues, partner relations, architectural and interior design, and corporate and hotel employee meetings and relations,

•	determine his work schedule,

•	determine the location from which he works, and

•	have a corporate plane and driver available.

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CHAIRMAN OF THE BOARD

General

As Chairman, Mr. Sharp would have responsibility for overseeing the management, development and effective functioning of the Board of Directors and would provide the Board with overall leadership in its work.

Specific Responsibilities

In addition, as Chairman, Mr. Sharp would have responsibility to:

•	promote cohesiveness among members of the Board of Directors,

•	chair meetings of the Board of Directors and of the shareholders,

•	ensure that Board functions are effectively carried out, and, where functions have been delegated to Committees, that the results are reported to the Board,

•	oversee the Chief Executive Officer’s execution of his or her responsibilities,

•	encourage and promote a culture of ethical business conduct, and

•	perform such other functions as may be ancillary to the duties and responsibilities described above and as may reasonably be delegated to the Chairman by the Board of Directors from time to time.

Reporting

So long as Mr. Sharp was the Chief Executive Officer, the Chief Operating Officer would report directly to him and, so long as Mr. Sharp was the Chairman (but not the Chief Executive Officer), the Chief Executive Officer would report directly to him.

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11-3-06

C.	Governance

Terms of Unanimous Shareholders Agreement
Parties:	Four Seasons, the Lead Investors, Mr. Sharp and Triples.

Voting Arrangements:	The Board would be comprised of five members: two nominees of each of Kingdom and Cascade, and one nominee of Mr. Sharp/Triples. Each of the Lead Investors and Mr. Sharp/Triples would be entitled to vote in proportion to their equity interest through their nominees to the Board. So long as he is the Chief Executive Officer or Chairman, Mr. Sharp will be the nominee of Mr. Sharp/Triples to the Board. All meetings of the Board would be in Toronto. Participation in meetings of the Board may be by telephone.

Day-to-Day Governance:	All matters that are not Material Decisions (as that term is defined below) would fall under the exclusive authority of the Chairman (so long as Mr. Sharp is the Chairman), the Chief Executive Officer and the Management Committee of Four Seasons.

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Reporting:

The Chief Executive Officer and representatives of the Management Committee would meet with the Board of Directors quarterly in Toronto (with participation by conference telephone being permitted).

So long as Mr. Sharp was either the Chief Executive Officer or Chairman (or would have been eligible to occupy one of those roles but for a breach by a party other than Mr. Sharp of agreements relating to Mr. Sharp’s tenure in those positions), at one of these meetings, the Chief Executive Officer would present the annual budget (a “Sharp Annual Budget”) for review and approval, provided that approval could not be withheld if the aggregate cash expenses, capital expenditures and investments in (or advances to) secure, maintain or enhance management agreements in that proposed budget was not materially inconsistent with the budget for the prior year, including future capital commitments outlined therein (for the purposes of determining consistency, material capital commitments expressly approved as Material Decisions,as provided below, in a preceding year would not be considered to be included in that year’s budget). Thereafter (i) at one of these meetings, the Chief Executive Officer would present to the Board for its approval an annual budget, which would become the approved annual budget for the year once it was approved, and (ii) pending approval of the proposed annual budget, management would have the authority to operate the business in accordance with the expense portion of the most recently approved budget (increased by a factor equal to any increase of the consumer price index for the City of Toronto).

In addition, the Chief Executive Officer would arrange to have a monthly operating report prepared for distribution to the Board.

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Confidential

11-3-06

Material Decisions:

For so long as Mr. Sharp was either Chief Executive Officer or Chairman (and thereafter if he ceased to hold either of those positions as a result of a breach by a party other than Mr. Sharp of agreements relating to Mr. Sharp’s tenure in those positions), and provided that he was not physically incapacitated or mentally incompetent, approval of the Material Decisions listed in items 1, 3, 7, 13, 14 and 16, below, would require approval by the holder of the VMVS (or by Mr. Sharp upon the conversion of the VMVS upon the completion of a public offering as described above, provided Mr. Sharp would not be entitled to exercise such approval rights after the completion of that public offering unless that public offering was completed before the fifth anniversary of the date of closing of the Transaction, in which event he would be entitled to exercise such approval rights until such fifth anniversary), as well as requiring approval as a “Material Decision.”

The following would be material decisions (“Material Decisions”) that would require approval by the votes cast by directors nominated by shareholders holding at least 66 2/3% of the equity interests of Four Seasons:

1. material departures (including new lines of business) from Four Seasons’ previously approved long-term strategy,

2. amendment of articles or by-laws,

3. any matter that requires approval of shareholders by way of a "special resolution" under the Business Corporations Act (Ontario) (such as amalgamation, dissolution or continuance and the disposition of all or substantially all of the assets of the Company),

4. entering into management arrangements on terms materially different than those in Four Seasons’ existing arrangements,

5. investing more than US$25 million in connection with a single management, investment or real estate opportunity,

6. settling or compromising proceedings involving payments or receipts of more than US$1 million, in the aggregate each year, in addition to amounts contemplated in the approved annual budget,

7. corporate acquisitions,

8. issuance, redemption or purchase by the Company of securities (other than the redemption of the preferred shares held by Mr. Sharp/Triples),

9. payment of dividends or other distributions to shareholders,

10. approval of the strategic plans proposed by management from time to time,

11. incurring indebtedness for borrowed money in excess of amounts contemplated in the approved annual budget,

12. expenditures or capital or funding commitments in excess of an amount to be agreed that are not otherwise contemplated in the approved annual budget,

13. changing the approved succession plans for members of Management Committee, making appointments to those positions other than as contemplated in the approved succession plan, or hiring any external candidate into a Management Committee position,

14. the termination of the employment of Ms. Taylor, the appointment of a replacement for Ms. Taylor or change in the structure of senior management following the termination, resignation, retirement, physical incapacity, mental incompetence or death of Ms. Taylor,

15. a public offering or private placement of voting or equity securities of Four Seasons,

16. relocating Four Seasons’ worldwide head office from its current location in Toronto, Canada,

17. changing auditors,

18. making material tax elections or changing the method of tax accounting,

19. changing existing accounting practices, except as the auditors advise is required by law or generally accepted accounting principles, or writing up, down or off the book value of any assets that, in aggregate, exceed US$5 million per annum (except for depreciation and amortization in accordance with GAAP),

20. approval of a Sharp Annual Budget, subject to the requirement that such approval not be withheld in the circumstances described above under “Reporting”, and approval of any annual budget that is not a Sharp Annual Budget,

21. transactions or arrangements that would reasonably be expected to transfer value from Four Seasons to one or more of its shareholders or their affiliates (other than those transactions or arrangements described herein), and

22. canceling, terminating or materially amending insurance coverage.

Approval of the Material Decision listed in item 21 (and if there is any ambiguity whether a particular transaction or arrangement falls within that item, the ambiguity shall be resolved in favor of it doing so) would require approval by the requisite majority disregarding votes cast by directors nominated by shareholders that have (or whose affiliates have) an interest in that transaction or arrangement.

Any amendment or modification of the unanimous shareholders agreement would require approval by each of Kingdom, Cascade, and Sharp/Triples.

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Sale of Shares:	None of the Lead Investors could dispose of any of its interest in Four Seasons, directly or indirectly, (other than to a person who controls, was controlled by, or was under common control and economic ownership with, the Lead Investor) until after the second anniversary of the closing of the Transaction. Any direct or indirect disposition of shares of Four Seasons by Mr. Sharp/Triples (other than to a person who controlled, was controlled by, or was under common control and economic ownership with, Mr. Sharp/Triples) would be subject to an equal right of first offer (which could be accepted only in respect of all of the shares offered) in favour of Kingdom and Cascade for a value determined by a valuator mutually agreed upon by Mr. Sharp/Triples, Kingdom and Cascade that reflected, among other things, the potential of the “Four Seasons” brand and the long-term prospects of the enterprise but without regard to any control premium that might be ascribed in relation to such purchase.⁴
	Any direct or indirect disposition of shares of Four Seasons by the Lead Investors (other than (a) to a person who controlled, was controlled by, or was under common control and economic ownership with, the Lead Investor, or (b) from a Kingdom Trust company to HRH or from HRH to a Kingdom Trust company) would be subject to a right of first offer in favour of the other Lead Investors and Mr. Sharp/Triple’s, pro rata in accordance with their equity interests. If the shares subject to the right of first offer were not all acquired by the other Lead Investors and Mr. Sharp/Triples, they could be sold (subject to “tag-along rights” if Kingdom or Cascade or a related entity had initiated the sale process) to a “Qualified Person”, being a person that (i) was not, and was not an affiliate of, a competitor of Four Seasons, (ii) had adequate financial capacity to perform the obligations of a shareholder under the unanimous shareholders agreement and agreed to be bound by such agreement, (iii) was not of ill repute, and (iv) was not in any other manner a person with whom the other Lead Investors and Mr. Sharp/Triples, as reasonable and prudent business persons owning a significant investment in Four Seasons, would not wish to associate in that capacity.

Dispute Resolution:	Final arbitration under the Rules of Arbitration of the International Chamber of Commerce after a 60-day period of good faith negotiation.

_________________________

⁴The process for selecting a valuator and the parameters to be taken into account by the valuator would be further refined in formal documentation.

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11-3-06

EX-99 3 sc13dex992110606.htm LETTER

Confidential

November 3, 2006

Board of Directors

Four Seasons Hotels Inc.

1165 Leslie Street

Toronto, Ontario

Canada M3C 2K8

Ladies and Gentlemen:

Kingdom Hotels International and Cascade Investment, L.L.C., together with Isadore Sharp and Triples Holdings Limited, are pleased to offer to acquire all of the outstanding Limited Voting Shares of Four Seasons Hotels Inc. (the “Company”) at a cash purchase price of US$82.00 per share on the terms set forth in this letter.

As you know, Kingdom and its affiliates have had a long-term strategic relationship with Four Seasons, both as a significant shareholder in the Company and as the owner of 10 hotels managed by the Company. Cascade, which is a private investment vehicle owned by William H. Gates III, also is a substantial investor in the Company. Through its ownership of the Company’s Variable Multiple Voting Shares, Triples, which is Mr. Sharp’s family holding company, is the controlling shareholder of the Company.

We believe that our offer is fair to and in the best interests of the Company and its public shareholders and that the shareholders will find our proposal attractive. Our offer represents a premium of 28.4% over the closing price of the shares on November 3, 2006 and a 29.3% premium over the average closing price over the past 30 trading days.

Under our proposal, Mr. Sharp would continue to direct all aspects of the day-to-day operations and strategic direction of the Company as Chairman and CEO following the transaction. We also expect that the Company’s senior management team would remain in place. We believe that this will preserve the business in a manner that will preserve and expand the long-term strategy, vision and core values of Four Seasons.

Each of Kingdom, Cascade and Triples would reinvest their existing equity in the Company, representing a total rollover of approximately US$970 million based on the proposed transaction price. In addition to this equity rollover, the transaction would be financed through a combination of (x) US$750 million of new debt financing, which is expected to be used in part to repay the existing convertible debt of the Company, and (y) approximately US$1.87 billion of equity (after taking into account available cash of the Company) that would be provided by Kingdom and Cascade (either directly or through affiliated entities). The undersigned have entered into an agreement among themselves with respect to certain matters related to the proposal. We have provided a copy of this agreement for your information.

Because of our extensive familiarity with the Company, we expect to be able to negotiate and complete the transaction in an expedited manner. The acquisition is expected to be structured as a plan of arrangement or as an amalgamation. The transaction would be subject to customary conditions, including shareholder approval, filings under Canadian, US and other competition laws, and Investment Canada approval. We are comfortable with our ability to arrange the necessary debt financing, and there would be no financing condition.

We expect that you will establish a special committee of independent directors to consider our proposal and to recommend to the full Board whether to approve the proposal.

Of course, no binding obligation on the part of the Company or any of the undersigned will arise with respect to the proposal or any acquisition transaction, unless and until such time as definitive documentation satisfactory to us and recommended by the special committee and approved by the Board is executed and delivered.

All of the undersigned look forward to working with the special committee and its legal and financial advisors to negotiate an acquisition agreement and complete a transaction that is attractive to the public shareholders. If you have any questions, please contact a representative of Kingdom or Cascade.

Sincerely,

Kingdom Hotels International		Cascade Investment, L.L.C.

By:	/s/ HRH Prince Alwaleed Bin Talal	By:	/s/ Michael Larson
	Bin Abdulaziz Alsaud
	HRH Prince Alwaleed Bin Talal
	Bin Abdulaziz Alsaud


Triples Holdings Limited

By:	/s/ Isadore Sharp		/s/ Isadore Sharp
			Isadore Sharp

Attachment

EX-99 4 sc13dex993110606.htm SHAREHOLDERS AGREEMENT

SHAREHOLDERS AGREEMENT

THIS AGREEMENT made this 26th day of September, 1994.

BY AND AMONG:

TRIPLES HOLDINGS LIMITED, a corporation duly incorporated under the laws of Ontario,

(hereinafter referred to as "Triples");

AND:

a corporation to be incorporated under the laws of Barbados,

(hereinafter referred to as "HRHCO");

AND:

ISADORE SHARP, an individual residing in Toronto, Ontario, Canada,

(hereinafter referred to as "Sharp");

AND:

HIS ROYAL HIGHNESS PRINCE ALWALEED BIN TALAL BIN ABDULAZIZ AL SAUD, an individual residing in Riyadh, Saudi Arabia,

(hereinafter referred to as "HRH").

WHEREAS, Triples, HRH and Sharp entered into a Tender Agreement, dated September 26, 1994 (the "Tender Agreement") which provides, subject to the terms and conditions set forth therein, that HRH will cause HRHCO to (a) make a takeover bid to purchase 25% of all issued and outstanding subordinate voting shares ("SVS") of Four Seasons Hotels Inc., a corporation duly incorporated under the laws of Ontario (the "Corporation"), and (b) to purchase directly from Triples 25% of all issued and outstanding multiple voting shares ("MVS") of the Corporation;

WHEREAS, the parties hereto wish to enter into this Agreement to govern their relationship as shareholders of the Corporation as and from the date that HRHCO takes up and pays for the MVS and SVS.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the Parties agree and understand as follows:

ARTICLE I

INTERPRETATION

1.1 Definitions. For the purpose of this Agreement, the following words and phrases shall have the following meanings, respectively, unless the context otherwise requires.

(a)	"Act" shall mean the Business Corporations Act (Ontario).

(b)	"best efforts" shall mean best efforts, but shall not imply an obligation to pay money should an unforeseen event occur.

(c)	"Closing" shall have the meaning ascribed thereto in Section 5.1 hereof.

(d)	"HRHCO Election Period" and "HRHCO Change of Control Election Period" shall have the meanings ascribed thereto in Section 4.3 hereof.

(e)

"Member of the Sharp Family" shall mean Sharp, his spouse, any of his issue and the spouses of any of them, his or their legal representatives, any corporation of which all of the voting shares are beneficially owned, directly or indirectly, by any one or more of the foregoing persons, corporations or other entities, and any trust the only beneficiaries of which are any one or more of the foregoing persons, corporations or other entities.

(f)	"Offer Notice" and "Offer Notice of Change of Control" shall have the meanings ascribed thereto in Section 4.3 hereof.

(g)

"Parties" shall mean the Persons named in the preamble hereof, and shall include any other Person that becomes a Shareholder after the date hereof; and "Party" shall mean any one of them. In the event, however, that any Shareholder shall, after the date hereof, cease to be a Shareholder of the Corporation, then such Party shall thereupon cease to be a Party to this Agreement, and this Agreement shall be deemed to have been amended accordingly.

(h)

"Permitted HRH Assignee" shall mean HRH, his spouse, any of his issue and the spouses of any of them, any corporation of which all of the voting shares are beneficially owned, directly or indirectly, by any one or more of the foregoing persons, corporations or other entities and any trust the only beneficiaries of which are any one or more of the foregoing persons, corporations or other entities.

(i)	"Permitted Sharp Transferee" shall mean a Member of the Sharp Family or a bona fide financial institution that has been granted a security interest in Securities by Triples or a Member of the Sharp Family which institution takes such interest subject to this Agreement.

(j)	"Person" shall mean an individual, corporation, company, cooperative, partnership, trust, unincorporated association or governmental body, whether now or hereafter in existence; and pronouns that refer to a Person shall have a similarly extended meaning.

(k)	"Prohibited Transfer" shall have the meaning ascribed thereto in Section 4.1 hereof.

(l)

"Securities" shall mean any and all MVS, SVS or other securities of the Corporation beneficially owned by a Shareholder, provided that, in the case of a Permitted Sharp Transferee other than Sharp, such term shall not include MVS, SVS or other securities of the Corporation acquired from Persons other than Triples and Sharp but shall include MVS, SVS or other securities of the Corporation acquired from other Permitted Sharp Transferees where such MVS, SVS or other securities of the Corporation were "Securities" in the hands of such other Permitted Sharp Transferees immediately prior to such acquisition.

(m)	"Shareholder" shall mean any one of Triples, HRHCO and any Permitted Sharp Transferee or any Permitted HRH Assignee which has acquired shares of Triples or Securities.

(n)	"Third Party Offer" and "Third Party Control Offer" shall have the meanings ascribed thereto in Section 4.3 hereof.

1.2 Gender. Any reference in this Agreement to any gender shall include all genders and words used herein importing the singular number only shall include the plural and vice versa, unless the context otherwise dictates.

1.3 Headings. The division of this Agreement into Articles, Sections, Subsections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized is the construction or the interpretation of this Agreement.

1.4 Severability. Any Article, Section, Subsection or other subdivision of this Agreement or any other provision of this Agreement which is, or becomes, illegal, invalid or unenforceable shall be severed herefrom and shall be ineffective to the extent of such illegality, invalidity or unenforceability and shall not affect or impair the remaining provisions hereof which shall remain in full force and effect.

1.5 Entire Agreement. This Agreement, together with any counterpart hereto or other instrument to be delivered pursuant hereto, constitutes the entire agreement between the Parties with respect to the subject matter hereof, superseding any negotiations, prior discussions and prior agreements among any or all of the Parties.

1.6 Amendments. No amendment to this Agreement shall be binding unless otherwise expressly provided in an instrument in writing duly executed by the Parties.

1.7 Waiver. Except as otherwise provided in this Agreement, no waiver of any of the provisions of this Agreement shall be deemed to constitute a waiver of any other provisions (whether or not similar), nor shall such waiver constitute a continuing waiver, unless otherwise expressly provided in an instrument in writing duly executed by the Party to be bound thereby.

1.8 Governing Law. This Agreement shall be governed, interpreted and construed by and in accordance with the laws currently in force in the Province of Ontario and the laws of Canada applicable therein and shall be treated in all respects as an Ontario contract.

1.9 Schedule. Schedule 7.3 is annexed to and incorporated in this Agreement by reference and is deemed to be a part hereof.

1.10 Preamble. The preamble hereto is incorporated herein by reference and deemed to be a part of this Agreement.

1.11 Binding Effect. This Agreement shall enure to the benefit of and be binding upon the Parties hereto and their respective heirs, legal representatives, successors and permitted assigns, including, but not limited to, any trustee or administrator succeeding to the assets of Sharp. It is expressly agreed and understood by the Parties that HRHCO may only assign its rights and obligations hereunder to a Permitted HRH Assignee. The Parties hereto mutually covenant and agree that they shall sign and execute all such other deeds and documents and do such other things as may be necessary or desirable for more completely and effectually carrying out the terms and intentions of this Agreement.

ARTICLE II

MANAGEMENT

2.1 Board of Directors. Two persons nominated by HRHCO shall be elected directors of the Corporation as soon as practicable after HRHCO has taken up and paid for the MVS and SVS. HRHCO shall be free to change its nominees at any time at its discretion. Triples shall cast each vote represented by the Securities it owns, and Sharp shall use his best efforts, to cause such nominees of HRHCO to be at all times elected or re-elected directors of the Corporation. In the event that any nominee of HRHCO ceases to be a director of the Corporation prior to the expiration of his appointed term, Triples and Sharp shall use their best efforts to ensure that such vacancy shall be filled by HRHCO’s nominee. Triples and Sharp agree to use their best efforts to prevent any Triples’ nominee on the Corporation’s Board of Directors from voting in favour of any resolutions delegating any power of the Board of Directors of the Corporation to a single director or officer, other than for the purpose of implementing resolutions adopted by the Board of Directors or any committee thereof. Similarly, Sharp and Triples agree to use their best efforts to cause management of the Corporation to consult with HRH and seek and consider (without any obligation to follow) his recommendations before formulating any plan to make a fundamental change in the capital structure of the Corporation.

2.2 Board Committees. Triples and Sharp shall use their best efforts to cause Triples’ nominees on the Board of Directors of the Corporation to cause each committee of the Board of Directors of the Corporation to include at least one director nominated by HRHCO.

2.3 Notice. Triples and Sharp agree to use their best efforts to ensure that notice of any meeting of the Board of Directors of the Corporation be given at least seventy-two (72) hours prior to the meeting.

ARTICLE III

SPECIAL MATTERS

3.1 Special Matters. Sharp and Triples, through the exercise (or withholding thereof) of the voting rights attached to the Securities owned from time to time by Triples or by any Permitted Sharp Transferee, shall ensure that no act, decision or resolution which has any of the objects or purposes set forth in subparagraphs 3.1(a) through 3.1(f), inclusive, may be approved by the Corporation’s shareholders unless such act, decision, or resolution has been approved by HRHCO prior thereto:

(a)

any decision of the Corporation to wind up, dissolve, liquidate or otherwise cease to carry on the existing business of the Corporation;

(b)

any plan of arrangement of the Corporation;

(c)

the sale of all or substantially all of the assets of the Corporation;

(d)

any change in the auditors of the Corporation;

	(e)	the merger or amalgamation of the Corporation; and
	(f)	any change in the articles or by-laws of the Corporation.

ARTICLE IV

RESTRICTION ON TRANSFER

4.1 No Transfer by Triples. Except as permitted in this Article IV: (a) none of Triples, Sharp or any Permitted Transferee may sell, transfer, in whole or in part, directly or indirectly, any Securities or any right, title or interest therein (a "Prohibited Transfer"); and (b) any proposed or effected change of control of Triples, within the meaning of the Act, shall be a Prohibited Transfer.

4.2 Assignment to Permitted Share Transferee. Notwithstanding Sections 4.1 and 4.3, Triples, Sharp and any Permitted Sharp Transferee may transfer or assign all or any portion of the Triples shares or the Securities to a Permitted Sharp Transferee, provided that, prior to such transfer or assignment, such Permitted Sharp Transferee shall have executed a counterpart of this Agreement in accordance with Section 7.3 hereto and provided further (i) that before Sharp’s death or incapacity, none of the foregoing transfers shall be permitted if, immediately following such transfers, Sharp would cease to own, directly or indirectly, Securities granting to Sharp more than 50% of the voting rights attached to all voting securities of the Corporation, and (ii) that after Sharp’s death or incapacity, none of the foregoing transfers shall be permitted if, immediately following such transfers, Permitted Sharp Transferees would cease to own, directly or indirectly, Securities granting to Permitted Sharp Transferees more than 50% of the voting rights attached to all voting securities of the Corporation.

4.3 Right of First Offer. (a) Subject to Section 4.2 hereof and paragraphs (b) and (c) below, if at any time Triples or a Permitted Sharp Transferee desires to sell any Securities, Triples or the Permitted Sharp Transferee shall first offer such Securities by written notice (the "Offer Notice") to HRHCO on specific terms and conditions, which shall include a price payable only in cash. Within thirty (30) days after receiving the Offer Notice (the "HRHCO Election Period"), HRHCO may irrevocably elect to purchase all of such Securities, at such price and on such terms and conditions. In the event that no such election is made by HRHCO, Triples or the Permitted Sharp Transferee shall be free to offer such Securities to a third party (a "Third Party Offer") on terms and at a price no less favourable to Triples or the Permitted Sharp Transferee than the terms and price offered to HRHCO, provided that any sale to a third party must be consummated within ninety (90) days from the end of the HRHCO Election Period. If no sale to, and purchase by, a third party takes place within such ninety (90) day period, Triples or the Permitted Sharp Transferee may not thereafter transfer such Securities without again following and being subject to this Section 4.3.

(b) Subject to Section 4.2 hereof and paragraphs (a) above and (c) below, if, at any time, Triples or a Permitted Sharp Transferee desires to sell any Securities and if, as a result of the consummation of the sale of such Securities, Sharp, or, after his death or incapacity, Permitted Sharp Transferees would cease to own, directly or indirectly, Securities granting to Sharp or such Permitted Sharp Transferee more than 50% of the voting rights attached to all voting Securities of the Corporation, Triples or the Permitted Sharp Transferee shall first offer such Securities by written notice (the "Offer Notice of Change of Control") to HRHCO on specific terms and conditions, which shall include a price payable only in cash. Within sixty (60) days after receiving the Offer Notice of Change of Control (the "HRHCO Change of Control Election Period"), HRHCO may elect irrevocably to purchase all of such Securities subject only to customary regulatory approvals, at such price and on such terms and conditions. In the event that no such election is made by HRHCO, Triples or the Permitted Sharp Transferee shall be free to offer such Securities to a third party (a "Third Party Offer for Control") on terms and at a price no less favourable to Triples or the Permitted Sharp Transferee than the terms and price offered to HRHCO, provided (i) that either any sale to a third party is consummated or an agreement to sell such Securities entered into, subject only to customary regulatory approvals and usual conditions, within one hundred and eighty (180) days from the end of the HRHCO Change of Control Election Period, and (ii) that Triples or the Permitted Sharp Transferee, on an ongoing basis, keeps HRHCO generally informed about its efforts to sell such Securities. If no sale to, and purchase by, or agreement with, a third party takes place within such one hundred and eighty (180) day period, Triples or the Permitted Sharp Transferee may not thereafter transfer such Securities without again following and being subject to this Section 4.3.

(c) Any purported transfer in violation of this Section 4.3 shall be void ab initio, except that Triples and Permitted Sharp Transferees may sell Securities in each twelve-month period free of the restrictions contained in this Section 4.3 for aggregate consideration, during such period, of up to $1,000,000, it being understood that this exception shall not be available with respect to any sale of Securities if, as a result of such sale Sharp, or, after his death or incapacity, Permitted Sharp Transferees, would cease to own, directly or indirectly, Securities granting more than 50% of the voting rights attached to all voting securities of the Corporation.

(d) In the event that Triples or Permitted Sharp Transferee(s) should offer for sale more than 50% of the MVS and HRHCO exercises its right to purchase such MVS pursuant to the terms of this Section 4.3, Triples or such Permitted Sharp Transferee(s) agree that HRHCO may, concurrently therewith, offer to acquire all remaining MVS, and make a tender offer for all issued and outstanding SVS on the same terms and conditions as set forth in the Offer Notice or the Offer Notice of Change of Control, for the purpose of maintaining the multiple voting feature of the MVS.

4.4 Right of Concurrent Sale. If Triples or a Permitted Sharp Transferee makes a Third Party Offer or a Third Party Offer for Control pursuant to Section 4.3 hereof, HRHCO shall have the right, at its sole option, to require that a proportionate amount of the Securities held by HRHCO be included in any sale to a third party on the same terms and conditions as those contained in the Third Party Offer or a Third Party Offer for Control. If HRHCO wishes to exercise the right of concurrent sale in this Section 4.4, then it shall do so by notice to Triples or Permitted Sharp Transferee prior to the expiration of the HRHCO Election Period or HRHCO Change of Control Election Period, as the case may be. Triples or Permitted Sharp Transferees may, however, sell Securities in each twelve-month period (inclusive of the Securities sold under the similar exception under paragraph 4.3(c) hereof) free of the restrictions contained in this Section 4.4 for an aggregate consideration of $1,000,000, it being understood that this exception shall not be available with respect to any sale of Securities if, as a result of such sale, Sharp, or after his death or incapacity, Permitted Sharp Transferees would cease to own Securities granting more than 50% of the voting rights attached to all voting securities of the Corporation.

ARTICLE V

CLOSING

5.1 Procedure and Closing for Sale of Securities. The closing (the "Closing") of any sale or transfer of Securities pursuant to the procedure set forth in Section 4.3 shall be held at the head office of the Corporation at 10:00 a.m., Toronto time, on the date stipulated herein for Closing, or at such other place, at such other time or on such other date as the parties thereto may agree, in accordance with the terms and conditions hereinafter set forth in this Section 5.1.

At Closing, the selling Shareholder shall deliver to HRHCO the certificates representing the Securities being sold, which certificates shall be accompanied by a duly executed assignment of the Securities to HRHCO. Payment for any Securities purchased pursuant to the terms hereof will be made by way of wire transfer, bank draft or certified cheque, and payment for such Securities will, except as otherwise provided for herein, be made at Closing.

At Closing, the selling Shareholder shall deliver to HRHCO good title to the Securities being sold, free from all mortgages, privileges, charges, security interests, claims, encumbrances and other rights of other of any nature whatsoever.

If the selling Shareholder is obligated to sell its Securities pursuant to Section 4.3 and if the selling Shareholder fails to complete the transaction of purchase and sale, then the amount which HRHCO otherwise would be required to pay to the selling Shareholder at Closing may be deposited by HRHCO into a trust account in the name of the selling Shareholder at the bank branch used by the Corporation. Upon making such deposit and giving the selling Shareholder notice thereof, the purchase of the selling Shareholder’s Securities by HRHCO shall be deemed to have been fully completed and all right, title, benefit and interest, both at law and in equity, in and to the Securities to which HRHCO is entitled, shall be conclusively deemed to have been transferred and assigned to and vested in HRHCO. The selling Shareholder shall be entitled to receive the amount deposited in the trust account upon satisfying the selling Shareholder’s obligations pursuant to this Section 5.1.

ARTICLE VI

SHARE CERTIFICATES

6.1 Share Certificates. Triples agrees to surrender the certificates representing MVS to the Corporation for the purpose of endorsing all such share certificates with a legend in substantially the form as follows:

"Ownership, sale, transfer, disposition or alienation of the shares represented by this certificate is subject
to the terms and conditions of a Shareholder Agreement dated September 26, 1994."

Sharp further agrees to surrender his Triples shares to Triples for the purpose of endorsing such share certificates with a similar inscription, and Triples agrees to so endorse such shares.

ARTICLE VII

GENERAL PROVISIONS

7.1 Termination of Agreement. This Agreement shall terminate upon the happening of any of the following events:

(a)

upon the agreement in writing of all of the Parties hereto; or

(b)

upon HRH, HRHCO or Permitted HRH Assignees ceasing to own at least 10% of the issued and outstanding SVS; or

(c)

upon Triples and Permitted Sharp Transferees ceasing to own Securities granting to such persons more than 50% of the voting rights attached to all voting securities of the Corporation.

7.2 Notices. Any notice or other document required or permitted under this Agreement shall be in writing and shall be given by delivery or sent by telecopier or similar telecommunications device (provided that receipt is verified by fax answerback) and addressed as follows:

(a)

in the case of Triples and Sharp, to:

Isadore Sharp

c/o Four Seasons Hotels Inc.

1165 Leslie Street

Toronto, Ontario, Canada

M3C 2K8

Telecopier: (416) 441-4436

with copies (which shall not constitute notice) to:

Goodman & Goodman

250 Yonge Street

Suite 2400

Toronto, Ontario

Canada M5B 2M6

Attention: Lorie Waisberg, Q.C.

Telecopier: (416) 979-1234

(b)

in the case of HRHCO and HRH, to:

His Royal Highness

Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud

P.O. Box 8653

Riyadh, 11492

Kingdom of Saudi Arabia

Telecopier:

011.966.1.481.1954

011.966.1.441.6102

with copies (which shall not constitute notice) to:

Hogan & Hartson L.L.P.

Columbia Square

555 13th Street, N.W.

Washington, D.C. 20004

U.S.A.

Attention:

Mark E. Mazo

Alphonso A. Christian, II

Telecopier: (202) 637-5910

(c)

in the case of the Corporation, to:

Four Seasons Hotels Inc.

1165 Leslie Street

Toronto, Ontario, Canada

M3C 2K8

Attention: Secretary

Telecopier: (416) 441-4436

with copies (which shall not constitute notice) to:

Goodman & Goodman

250 Yonge Street

Suite 2400

Toronto, Ontario

Canada M5B 2M6

Attention: Lorie Waisberg, Q.C.

Telecopier: (416) 979-1234

Any notice or document given as aforesaid shall be deemed to have been effectively given and received, if delivered, on the date of such delivery, or, if sent by telecopier or similar telecommunications device, to have been given and received on the next business day following such transmission. Any address for service may be changed by written notice given as aforesaid.

7.3 New Shareholder. This Agreement shall be executed by HRHCO and by any Person who shall from time to time become a Shareholder by signing a counterpart hereof in accordance with Schedule 7.3 annexed hereto. Each of such counterparts so executed shall be deemed to be an original and such counterparts together with this Agreement shall constitute one and the same instrument. No Person shall become a Shareholder without first having executed a counterpart hereof in accordance with Schedule 7.3 annexed hereto.

7.4. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same Agreement.

7.5 Individual Responsibilities. Each of Sharp and HRH hereby unconditionally guarantees the full and punctual performance by Triples and HRHCO, respectively, of all obligations of such entity under this Agreement. Each of Sharp and HRH further agrees to carry out and be bound by this Agreement to the full extent that he has the capacity to do so.

7.6 Securities. References to Securities include any securities into which the Securities may be reclassified, sub-divided, consolidated or converted and any rights and benefits arising therefrom including any extraordinary distributions of securities which may be declared in respect of such Securities.

7.7 Effectiveness of Agreement. This Agreement shall only become effective upon HRHCO taking up and paying for MVS and SVS in accordance to the Tender Agreement.

IN WITNESS WHEREOF, this Agreement has been executed by the Parties hereto as of the date and at the place first hereinabove mentioned.

TRIPLES HOLDINGS LIMITED

	Per: /s/


	HRHCO


	Per: /s/


	/s/
	Isadore Sharp


	/s/
	HRH Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud

Four Seasons Hotels Inc. (the "Corporation") hereby acknowledges receiving a copy of this Agreement and having cognizance of its terms and conditions. The Corporation further intends to place the legend described in Article VI on the certificates representing MVS and to give appropriate instructions to the Corporation’s transfer agent to implement the transfer restrictions set forth in this Agreement.

FOUR SEASONS HOTELS INC.

Per: /s/

SCHEDULE 7.3

COUNTERPART

THIS INSTRUMENT forms part of the Shareholders Agreement (the "Agreement") made as of the 26th day of September, 1994, among Triples Holdings Limited, HRHCO, Isadore Sharp, His Royal Highness Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud, and Four Seasons Hotels Inc. which Agreement permits execution by counterpart. The undersigned hereby acknowledges having received a copy of the said Agreement (which is annexed hereto as Schedule I) and having read the said Agreement in its entirety, and for good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, hereby agrees that the terms and conditions of the said Agreement shall be binding upon the undersigned and such terms and conditions shall enure to the benefit of and be binding upon the undersigned, his or her heirs, executors, administrators, successors and permitted assigns.

IN WITNESS WHEREOF, the undersigned has executed this instrument this _____ day of _________________, 1994.

	_________________________________
	(Signature of Shareholder)


	_________________________________
	(Name in block letters)

AMENDMENT NO. 1

TO SHAREHOLDERS AGREEMENT

AMENDMENT NO. 1 TO SHAREHOLDERS AGREEMENT (“Amendment”) is made with effect as of the ____ day of __________ 1997, by and among Triples Holdings Limited, an Ontario corporation, (“Triples”), Kingdom Investments Inc., a Barbados corporation (“HRHCO”), Isadore Sharp, an individual residing in Toronto, Ontario, Canada (“Sharp”), and His Royal Highness Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud (“HRH”).

WITNESSETH THAT:

WHEREAS, Triples, HRHCO, Sharp and HRH are parties to a certain Shareholders Agreement made the 26th day of September, 1994 (the “Agreement”) relating to Four Seasons Hotels Inc., an Ontario corporation (the “Corporation”); and

WHEREAS, the parties desire to clarify the circumstances in which a reduction in the proportionate ownership of the Limited Voting Shares of the Corporation by HRH, HRHCO, and Permitted HRH Assignees (as defined in the Agreement) would result in the termination of the Agreement;

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein and in the Agreement, as amended hereby, the parties hereto hereby agree as follows:

Section 7.1(b) of the Agreement is hereby amended and restated as follows:

(b)

upon HRH, HRHCO or Permitted HRH Assignees ceasing to own at least 10% of the issued and outstanding SVS, provided that any dilution of their shareholding percentages caused by the Corporation’s issuance of additional SVS (other than pro rata to holders of SVS on a basis that does not require additional investment by those holders) shall be disregarded in determining whether the aforementioned 10% interest ceases to be owned; or

2. The amended language set forth in this Amendment shall have retroactive effect to the date of the Agreement.

3. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect.

4. This Amendment may be signed in any number of counterparts, each of which shall constitute an original and all of which shall constitute one and the same agreement.

IN WITNESS WHEREOF, the undersigned have executed and delivered this Amendment, with effect as of the date set forth above, intending to be bound by all the terms hereof.

	TRIPLES HOLDINGS LIMITED


	By:	/s/
	Title:


	KINGDOM INVESTMENTS INC.


	By:	/s/
	Title:



	Isadore Sharp
	/s/


	His Royal Highness Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud
	/s/

EX-99 5 sc13dex994110606.htm CONFIDENTIALITY AGREEMENT

November , 4 2006

Private & Confidential

Four Seasons Hotels Inc.

1165 Leslie Street

Toronto, Ontario

Canada M3C 2K8

Attention: Randolph Weisz, Executive Vice-President and General Counsel

Dear Sirs,

We have expressed to Four Seasons Hotels Inc. (“you” or the “Company”) an interest in exploring the possibility of pursuing a transaction acceptable to the Board of Directors of the Company (the “Transaction”) pursuant to which we, as well as a small number of other long-term investors, might take the Company private to assist in the orderly transition of the long-term ownership of the Company and the realization by the shareholders of the Company of an appropriate value for their investments.

To assist us in evaluating, and possibly negotiating and pursuing, the Transaction (the “Specified Purpose”) we have requested that the Company provide us certain information that is not generally known to the public. Much of that information is commercially sensitive and proprietary, and improper use of that information could result in significant detriment to the Company.

In this context, and in consideration of the Company engaging in discussions concerning the Transaction and making information available to us (and other consideration, the receipt and sufficiency of which is acknowledged), we and the Company agree to be bound by the terms of this letter agreement.

1.	Information

For the purposes of this letter agreement,

•

all information concerning or relating to the Company, its affiliates and associates that is furnished to us or our directors, officers, employees, investment managers listed on the accompanying schedule, agents or advisors (collectively, “Representatives”) by or on behalf of the Company in connection with the Transaction,

•

analyses, compilations, summaries or other documents prepared by us or our Representatives containing or based upon any such information (collectively, “Derivative Information”), and

•

copies of any of the foregoing.

is referred to as the “Information”, regardless of its form or medium (oral, written, stored in computers, machine readable, electronic or other).

2.	Confidentiality and Non-Disclosure

Except to the extent expressly provided in any written agreement giving effect to the Transaction, the Information (other than analyses prepared by us and our Representatives, and only to the extent that those analyses do not contain Information provided by or on behalf of the Company) shall be, and shall remain at all times, the property of the Company.

Subject to Clause 3, the Information shall be kept confidential by us and our Representatives and shall not, without the prior written consent of the Company:

•

be disclosed by us or our Representatives in whole or in part, or

•

be used by us or our Representatives, directly or indirectly,

other than for the Specified Purpose (and then only to the extent necessary for that purpose).

In addition to the foregoing, we shall, and we shall ensure that our Representatives, maintain the confidentiality of the existence of this agreement and its contents, and the possibility of the Transaction, its terms and the content of all discussions, investigations and negotiations in connection with the Transaction (collectively, “Transaction Information”); provided that, notwithstanding the foregoing, we shall be permitted to communicate about a “Transaction” with Cascade Investment, L.L.C., Isadore Sharp, Triples Holdings Limited, potential financing sources for a Transaction, and the Representatives of each of them for the “Specified Purpose”; and provided further that we shall be permitted to disclose Transaction Information that has previously been publicly disclosed by the Company or with the permission of the Company.

We shall ensure that any other persons (which shall be given its broadest meaning) to whom the Information is disclosed by us or our Representatives as permitted by this letter agreement are aware of the confidentiality of the Information and are also bound by the same obligation of confidence as we are with respect to the Information for the benefit of the Company.

We will make Information available only to those of our Representatives who need to have access to the Information for the Specified Purpose.

We shall:

•

be responsible for any breach of these terms by any of our Representatives,

•

make all reasonable, necessary or appropriate efforts to safeguard the Information from disclosure other than as permitted by this letter agreement consistent with the practices used by us in protecting our own confidential information,

•

not copy or store any Information without the prior written consent of the Company (other than by standard electronic back-up system and except for such copies and storage as may reasonably be required internally by us or our Representatives in connection with our consideration and evaluation of a Transaction), and

•

in the event of any breach of this letter agreement or any disclosure of any Information by us or any of our Representatives other than as permitted by this letter agreement (accidentally, inadvertently or otherwise) notify the Company (first orally and then in writing) of the nature of the breach or disclosure promptly upon our discovery of the breach or disclosure.

We understand that only the directors and certain employees of the Company and certain of its Representatives currently are aware of this letter agreement or the possibility of a Transaction. Without the prior written consent of the Company which shall not be unreasonably withheld, neither we nor any

of our Representatives will approach, correspond with, talk to or contact in any other manner any Representative, creditor, shareholder, customer or supplier of the Company or its affiliates (other than the Chairman and Chief Executive Officer, the President Worldwide Business Operations, the Executive Vice-President and General Counsel and the Executive Vice-President and Chief Financial Officer of the Company or Jonathan Lampe of Goodmans LLP, David Katz of Wachtell, Lipton, Rosen & Katz or Jack Curtin, Jack Levy or Richard Weissman of Goldman Sachs) concerning this agreement, any Transaction or the fact that this letter agreement exists or that a Transaction is being considered.

3.	Excluded Information

The terms of this letter agreement shall not apply to any Information that:

•

is or becomes generally available to the public other than as a result of a disclosure by us or our Representatives,

•

becomes available to us or our Representatives on a non-confidential basis from a source other than the Company or its Representatives, provided that such source is not known to us or our Representatives to be bound by a confidentiality agreement or to be otherwise prohibited from transmitting the Information by a contractual, legal or fiduciary obligation,

•

was known to us or our Representatives prior to disclosure to us by the Company or its Representatives and was not known to us or our Representatives to be subject to a contractual, legal or fiduciary obligation for the benefit of another party,

•

the Company has consented in writing to exclude from this letter agreement prior to such disclosure, or

•

is required to be disclosed by applicable law, regulation, judicial order, legal process or the by-laws, rules or published policies of any securities regulator or stock exchange having jurisdiction (collectively, “Applicable Disclosure Requirements”).

If we or any of our Representatives are required under Applicable Disclosure Requirements to disclose any of the Information, we will, so long as we are not legally prohibited from doing so, provide the Company with prompt written notice so that the Company may seek a protective order or other appropriate remedy. We will co-operate with the Company at the Company’s expense to obtain such a protective order or other remedy. If a protective order or other remedy is not or cannot be obtained, we and our Representatives will furnish only that portion of the Information we have been advised by our external counsel is required by the Applicable Disclosure Requirements and will exercise all commercially reasonable efforts to obtain reliable assurances that confidential treatment will be afforded the Information.

4.	Return or Destruction of Information

If either of us determines that it does not wish to pursue the Transaction, it will promptly notify the other. In those circumstances, or if the Transaction does not otherwise proceed and the Company (in its sole discretion) so requests in writing, we will promptly (and in any event within ten business days) deliver to the Company all Information (other than that in oral form) in our possession or that of our Representatives, or ensure that all such Information (other than that in oral form) and all electronic media through which the Information has been stored shall be permanently destroyed or, to the extent reasonably practicable, erased. We shall confirm in a certificate delivered to the Company and signed by one of our

senior officers (who confirms his or her authorization to do so) that all such Information has been so returned, destroyed or erased.

5.	Securities Legislation

As securities legislation generally prohibits any person who has received material non-public information about a public company from purchasing or selling securities of the company or communicating any non-public material information to another person, we will ensure that adequate precautions are taken to ensure that neither we nor, to the extent reasonably practicable, our Representatives engage in such purchases or sales or such communication.

6.	No Representations and Warranties

Nothing in this letter agreement obligates the Company or any of its Representatives to make any particular disclosure, although we understand that the Company intends to use its reasonable efforts to provide Information to us for the appropriate consideration and evaluation of the Transaction. Although we understand that the Company will endeavour to include in the Information provided by it those materials that it believes to be reliable and relevant, neither the Company nor any of its Representatives makes any representation or warranty as to the accuracy or completeness of the Information provided by it, except as otherwise may be provided in specific representations and warranties in another definitive agreement entered into in connection with a Transaction. None of the Company or any of its Representatives shall have any liability to us, any of our Representatives or any other person as a result of the use of the Information, except to the extent provided in such a definitive agreement.

7.	Non-Solicitation

During the period beginning on the date of this letter agreement and ending twelve months after that date, none of us or our Representatives will (directly or indirectly) without the prior written authorization of the Company solicit the employment of or employ any individual who is employed or engaged by the Company or any of its affiliates and who is identified as a result of our evaluation of (or otherwise in connection with) the Transaction. This restriction shall not apply to the extent the employment of that individual was terminated before any solicitation by us or our Representatives or the solicitation or employment was the result of:

•

a solicitation directed at the public in publications available to the public in general and without the objective of soliciting an individual identified as a result of access to Information or our participation in the Specified Purpose, or

•

a solicitation by one of our Representatives who did not become aware of the individual as a result of access to Information or our or their participation in the Specified Purpose.

8.	Indemnity

We shall indemnify and hold harmless the Company and its Representatives from any damages, loss, costs or liabilities (including reasonable legal fees and the costs of enforcing this indemnity) actually incurred by them or arising out of or resulting from any breach of this letter agreement by us or any of our Representatives.

9.	Remedies

We acknowledge that the Company would not have an adequate remedy at law and would be irreparably harmed if any of the terms of this letter agreement were not abided by. Accordingly, the Company shall

be entitled to injunctive relief to prevent breaches of these terms and to specifically enforce these terms, in addition to any other remedy to which it may be entitled, and need not demonstrate irreparable harm, deposit any security or post any bond as a condition to any such remedy.

10.

Notices

Notices authorized or required by this agreement to be given to us shall be delivered or transmitted by facsimile to Kingdom Hotels International, PO Box 309GT, George Town, Grand Cayman

Cayman Islands, Attention: President (facsimile: +(345) 949-8080), with a copy (which shall not constitute notice) to Hogan & Hartson LLP, 555 Thirteenth Street NW, Washington, DC 20004, Attn: Bruce Gilchrist (facsimile:+1-202-637-5910). Notices authorized or required by this agreement to be given to the Company shall be delivered or transmitted to Four Seasons Hotels Inc., 1165 Leslie Street, Toronto, Ontario, M3C 2K8, attention: Executive Vice-President and General Counsel (facsimile: +1-416- 441-4349), with a copy (which shall not constitute notice) to Goodmans LLP, 250 Yonge Street, Suite 2400, Toronto, Ontario, M5B 2M6, attention: Jonathan Lampe (facsimile: +1-416-979-1234). Any such notice shall be deemed delivered and received on the day it is delivered or transmitted, provided that it is delivered or transmitted on a business day before 5:00 p.m. (local time in the place of delivery or receipt). If a notice is delivered after that time or on a day that is not a business day in the place of delivery or receipt, the notice shall be deemed to have been given and received on the next business day in the place in which it is delivered or received. We and the Company may, from time to time, change our respective addresses for notice by giving a notice to the other in accordance with the provisions of this clause.

11.

Privileged Information

Neither we nor the Company intends that the provision of any Information shall be deemed to waive or in any manner diminish any privilege or protection applicable to that Information. We shall not claim or contend that the Company has waived any privilege or other protection by providing Information pursuant to this letter agreement or any definitive agreement relating to a Transaction.

12.

General

This letter agreement constitutes the entire agreement between us with respect to its subject matter and supersedes any prior understandings or agreements with respect to that subject matter. There are no representations, warranties, terms, conditions, undertakings or collateral agreements (express, implied or statutory) between us, except as expressly provided in this letter agreement.

This letter agreement will enure to the benefit of, and be binding upon, our respective successors and assigns, provided that it may not be assigned by either of us without the prior written consent of the other.

Except as specifically provided in another definitive, written agreement, this letter agreement will survive its execution, the implementation of a Transaction (other than a Transaction pursuant to which we are an acquiring party) and any termination of the process relating to a Transaction without completion of a Transaction until the second anniversary of the date of this letter agreement, at which time it shall terminate and be of no further force or effect.

Except as specifically provided in this letter agreement or another definitive, written agreement relating to the Transaction, neither of us will be under any legal obligation or have liability to the other with respect to a Transaction. Without limitation, the Company and its Representatives may conduct a process (which we understand will include the provision of Information to, and discussion with, other persons regarding a Transaction) that may or may not result in a Transaction with us in such a manner as the Company, in its sole discretion, may determine. No failure or delay by the Company in exercising any right, power or

privilege under this letter agreement will operate as a waiver thereof, and no single or partial exercise thereof will preclude any other or future exercise of any right, power or privilege under this letter agreement.

Each of us and the Company shall bear its own costs of and incidental to the consideration and documentation of a Transaction.

This letter agreement shall be governed by, and construed in accordance with, the laws of the Province of Ontario. Each of us and the Company irrevocably attorns and submits to the non-exclusive jurisdiction of the courts located in Toronto, Ontario with respect to any matter arising under this agreement.

This agreement may be executed by facsimile and/or in counterparts and any such execution shall be a valid and binding execution hereof.

* **

Please confirm your agreement with the foregoing by signing and returning the attached acknowledgment copy of this letter. Delivery of an executed copy of this letter by electronic transmission will be as effective as the delivery of a manually executed copy of this letter by either of us.

KINGDOM HOTELS INTERNATIONAL .
By:	/s/ Charles S. Henry
	Authorized Signatory

Confirmed and agreed effective November 4, 2006

FOUR SEASONS HOTELS INC.
By:	/s/ S. Cohen
	Authorized Signatory

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