Tom & Katie Duet at Scientology Bash
11/02/2005 AT 01:00 PM EST
During a weekend charity dinner at Scientology’s English headquarters, St. Hill Manor in East Grinstead, "they were very sweet – holding hands and looking very cuddly," says one guest. "They looked like they were having a laugh."
At one point during the $350-a-plate dinner, singer Isaac Hayes, a fellow Scientologist, called Cruise, 43, and Holmes, 26, to the stage, where they belted out rock standards with the band. On their song list? "Mustang Sally" and "Old Time Rock and Roll," which Cruise famously sang in his underwear in 1983's Risky Business.
"They were laughing and smiling and talking to the crowd," said one of the 3,000 guests. "The crowd started dancing."
Earlier at the event, Cruise accepted an award for service to Scientology to thunderous applause. The actor left with Holmes shortly after the festivities.
Last month the engaged couple announced they were expecting their first child together. "Tom and Katie are very excited, and the entire family is very excited," Cruise's spokeswoman, Lee Anne DeVette, told PEOPLE.
DeVette said at the time that no wedding date has been set and would not comment on how far along the pregnancy is. But she did say that Holmes "has never felt better."