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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)*
TRUMP HOTELS & CASINO RESORTS, INC.
-----------------------------------
(Name of Issuer)
COMMON STOCK
------------------------------
(Title of Class of Securities)
898168109
--------------
(CUSIP Number)
DANIEL D. RUBINO, Esq.
WILLKIE FARR & GALLAGHER
One Citicorp Center
153 East 53rd Street
New York, New York 10022-4669
(212) 821-8000
-------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
OCTOBER 7, 1996
------------------------------------
(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 which is the subject of this Schedule 13D, and is filing this
schedule because of Rule l3d-l(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [X]. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule l3d-7.)
NOTE: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule l3d-l(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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<PAGE>
SCHEDULE 13D
- ------------------- ------------------
CUSIP No. 898168109 Page 2 of 25 Pages
- ------------------- ------------------
- --------------------------------------------------------------------------------
1 | NAME OF REPORT PERSON
| S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
|
| Donald J. Trump
- --------------------------------------------------------------------------------
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) { ]
| (b) [X]
- --------------------------------------------------------------------------------
3 | SEC USE ONLY
|
- --------------------------------------------------------------------------------
4 | SOURCE OF FUNDS*
|
| o o
- --------------------------------------------------------------------------------
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED [ ]
| PURSUANT TO ITEMS 2(d)or 2(e)
- --------------------------------------------------------------------------------
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
|
| United States
- --------------------------------------------------------------------------------
| 7 | SOLE VOTING POWER
NUMBER OF | |
| |
SHARES | | 12,100,706
----------------------------------------------------------------
BENEFICIALLY | 8 | SHARED VOTING POWER
| |
OWNED BY | |
| | 3,618,542
EACH ----------------------------------------------------------------
| 9 | SOLE DISPOSITIVE POWER
REPORTING | |
| |
PERSON | | 12,100,796
----------------------------------------------------------------
WITH | 10 | SHARED DISPOSITIVE POWER
| |
| | 3,618,542
- --------------------------------------------------------------------------------
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
| 15,719,248
- --------------------------------------------------------------------------------
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES [ ]
| CERTAIN SHARES*
|
- --------------------------------------------------------------------------------
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
| 39.4%
- --------------------------------------------------------------------------------
14 | TYPE OF REPORTING PERSON*
|
| IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- ------------------- ------------------
CUSIP No. 898168109 Page 3 of 25 Pages
- ------------------- ------------------
- --------------------------------------------------------------------------------
1 | NAME OF REPORT PERSON
| S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
|
| Trump Casinos, Inc.
- --------------------------------------------------------------------------------
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) { ]
| (b) [X]
- --------------------------------------------------------------------------------
3 | SEC USE ONLY
|
- --------------------------------------------------------------------------------
4 | SOURCE OF FUNDS*
|
| o o
- --------------------------------------------------------------------------------
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED [ ]
| PURSUANT TO ITEMS 2(d)or 2(e)
- --------------------------------------------------------------------------------
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
|
| New Jersey
- --------------------------------------------------------------------------------
| 7 | SOLE VOTING POWER
NUMBER OF | |
| |
SHARES | | 0
----------------------------------------------------------------
BENEFICIALLY | 8 | SHARED VOTING POWER
| |
OWNED BY | |
| | 1,407,017
EACH ----------------------------------------------------------------
| 9 | SOLE DISPOSITIVE POWER
REPORTING | |
| |
PERSON | | 0
----------------------------------------------------------------
WITH | 10 | SHARED DISPOSITIVE POWER
| |
| | 1,407,017
- --------------------------------------------------------------------------------
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
| 1,407,017
- --------------------------------------------------------------------------------
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES [ ]
| CERTAIN SHARES*
|
- --------------------------------------------------------------------------------
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
| 5.5%
- --------------------------------------------------------------------------------
14 | TYPE OF REPORTING PERSON*
|
| CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
- ------------------- ------------------
CUSIP No. 898168109 Page 4 of 25 Pages
- ------------------- ------------------
- --------------------------------------------------------------------------------
1 | NAME OF REPORT PERSON
| S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
|
| Trump Casinos II, Inc.
- --------------------------------------------------------------------------------
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) { ]
| (b) [X]
- --------------------------------------------------------------------------------
3 | SEC USE ONLY
|
- --------------------------------------------------------------------------------
4 | SOURCE OF FUNDS*
|
| o o
- --------------------------------------------------------------------------------
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED [ ]
| PURSUANT TO ITEMS 2(d)or 2(e)
- --------------------------------------------------------------------------------
6 | CITIZENSHIP OR PLACE OF ORGANIZATION
|
| Delaware
- --------------------------------------------------------------------------------
| 7 | SOLE VOTING POWER
NUMBER OF | |
| |
SHARES | | 0
----------------------------------------------------------------
BENEFICIALLY | 8 | SHARED VOTING POWER
| |
OWNED BY | |
| | 2,211,250
EACH ----------------------------------------------------------------
| 9 | SOLE DISPOSITIVE POWER
REPORTING | |
| |
PERSON | | 0
----------------------------------------------------------------
WITH | 10 | SHARED DISPOSITIVE POWER
| |
| | 2,211,250
- --------------------------------------------------------------------------------
11 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
| 2,211,250
- --------------------------------------------------------------------------------
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES [ ]
| CERTAIN SHARES*
|
- --------------------------------------------------------------------------------
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
| 8.4%
- --------------------------------------------------------------------------------
14 | TYPE OF REPORTING PERSON*
|
| CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Page 5
This Amendment No. 2 amends Item 7 and amends and restates Items 1-6 of
Amendment No. 1 filed by Mr. Donald J. Trump ("Mr. Trump") and Trump Casinos,
Inc. (formerly known as ("f/k/a") Trump Taj Mahal, Inc.) ("TCI") on April 25,
1996, and is being filed pursuant to Rule 13d-2(a) under the Securities Exchange
Act of 1934 (the "Exchange Act").
* * * * *
Items 1-6 are hereby amended by deleting each item in its entirety and
substituting the following Items 1-6 therefor:
Item 1. SECURITY AND ISSUER.
This Statement relates to the common stock, par value $.01 per share (the
"Common Stock"), of Trump Hotels & Casino Resorts, Inc. (the "Company"), a
corporation organized under the laws of the State of Delaware, which has its
principal executive offices at 2500 Boardwalk, Atlantic City, New Jersey 08401.
Item 2. IDENTITY AND BACKGROUND.
(a)-(c), (f). This Statement is being filed by Mr. Trump, TCI and Trump
Casinos II, Inc. (f/k/a TC/GP, Inc.) ("TCI-II"). Mr. Trump, TCI and TCI-II are
sometimes referred to herein individually as a "Reporting Person" and
collectively as the "Reporting Persons."
Mr. Trump's present principal occupation is Chairman of the Board of
Directors of each of the Company, Trump Hotels & Casino Resorts Funding, Inc.,
THCR Holding Corp. (f/k/a Taj Mahal Holding Corp.)("THCR Corp."), THCR/LP
Corporation (f/k/a TM/GP Corporation) ("THCR/LP") and Trump Atlantic City
Funding, Inc.; Chairman of the Board of Directors, President and Treasurer of
<PAGE>
Page 6
Trump Plaza Funding, Inc. ("Plaza Funding"); sole Director, President and
Treasurer of each of TCI, TCI-II and Trump Atlantic City Corporation (f/k/a The
Trump Taj Mahal Corporation) ("AC Corporation"); Director and President of Trump
Atlantic City Holding, Inc. (f/k/a Trump Plaza Holding, Inc.) ("AC Holding,
Inc."); sole Director of Trump Indiana, Inc. ("Trump Indiana"); Chairman of the
Board of Directors of Trump's Castle Hotel & Casino, Inc. ("TCHI"); sole
Director and President of each of Trump Taj Mahal Realty Corp. and Trump
Boardwalk Realty Corp.; and President of the Trump Organization. The business
address of Mr. Trump is 725 Fifth Avenue, New York, New York 10022. Mr. Trump is
a citizen of the United States of America.
TCI, a corporation organized under the laws of the State of New Jersey, and
TCI-II, a corporation organized under the laws of the State of Delaware, are
both wholly owned by Mr. Trump. TCI and TCI-II conduct no business other than
holding (i) a limited partnership interest in Trump Hotels & Casino Resorts
Holdings, L.P., a subsidiary of the Company (the "Partnership"), and (ii) shares
of the Company's Class B Common Stock, par value $.01 per share (the "Class B
Stock"). Mr. Trump is the sole Director, President and Treasurer of each of TCI
and TCI-II. TCI and TCI-II have no other executive officers. The business
address of each of TCI and TCI-II is 2500 Boardwalk, Atlantic City, New Jersey
08401.
(d), (e). Neither of the Reporting Persons has, during the last five years,
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) nor,
<PAGE>
Page 7
during the last five years, been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction, as a result of which the
Reporting Person was 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.
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
At the consummation of the Company's initial public offering of 10,000,000
shares of Common Stock on June 12, 1995, and pursuant to the Partnership's
Amended and Restated Agreement of Limited Partnership, dated as of June 12, 1995
(the "Original Partnership Agreement") (filed as Exhibit I and incorporated
herein by reference), Mr. Trump received approximately a 39.8% limited
partnership interest in the Partnership ("Trump's Limited Partnership Interest")
and the Company received an approximately 60.2% general partnership interest in
the Partnership. Trump's Limited Partnership Interest represented Mr. Trump's
economic interest in the assets and operations of the Partnership. Pursuant to
the terms of the Exchange and Registration Rights Agreement between the Company
and Mr. Trump, dated as of June 12, 1995 (the "Exchange Rights Agreement")
(filed as Exhibit II and incorporated herein by reference), Trump's Limited
Partnership Interest was convertible, at Mr. Trump's option, into 6,666,667
shares of Common Stock. If these shares had been converted on June 12, 1995,
they would have represented approximately 39.8% of the adjusted total number of
shares of Common Stock outstanding
<PAGE>
Page 8
(calculated by adding the total number of shares that were outstanding on that
date to the 6,666,667 shares).
On June 6, 1995 Mr. Trump acquired 1,000 shares of the Class B Stock, which
represented 100% of the total number of shares of the Class B Stock outstanding.
The Class B Stock has voting power equivalent to the voting power of the total
number of Conversion Shares (as defined), but is not entitled to dividends or
distributions.
Consideration for the acquisition of the Trump's Limited Partnership
Interest in June 1995 was his contribution to the Partnership, pursuant to the
terms of the Contribution Agreement between Mr. Trump and the Partnership, dated
as of June 12, 1995 (the "Contribution Agreement") (filed as Exhibit III and
incorporated herein by reference), of the assets listed in Schedule A thereto,
including all of his (i) beneficial interest in Trump Plaza Associates, which
consisted of (a) all of the outstanding capital stock of Plaza Funding, (b) a
99% equity interest in Trump Atlantic City Associates (f/k/a Trump Plaza Holding
Associates) ("Trump AC") and (c) all of the outstanding capital stock of AC
Holding, Inc., which owned the remaining 1% equity interest in Trump AC, and
(ii) existing interests and rights to new gaming activities in both emerging and
established gaming jurisdictions, including Trump Indiana.
Pursuant to the Contribution Agreement, Mr. Trump also agreed to pursue,
develop and conduct all new casino and gaming opportunities only on behalf of
the Company. Mr. Trump further agreed not to engage in certain actions in
connection with Casino
<PAGE>
Page 9
and Gaming Activities (as defined therein), including, without limitation,
casino hotels, and related services and products, except for those Casino and
Gaming Activities relating to the Trump Taj Mahal Casino Resort (the "Taj
Mahal") and Trump's Castle Casino Resort ("Trump's Castle").
On June 7, 1995, Mr. Trump acquired 250 shares of Common Stock in a
regular-way transaction at $14.00 per share (the "Trump Shares"). Mr. Trump
holds 100 of the Trump Shares for his own account, 50 as custodian for his son
Eric F. Trump, 50 as custodian for his daughter Ivanka Trump and 50 as custodian
for his son Donald J. Trump, Jr. On the same date, Mr. Trump also acquired, in a
regular-way transaction at $14.00 per share, an additional 50 shares of Common
Stock which he gave to his wife, Mrs. Marla M. Trump ("Mrs. Trump"), as a gift
(the "Gift Shares").
On April 17, 1996, in connection with the merger (the "Taj Merger") of THCR
Merger Corp., a wholly owned subsidiary of the Company, with and into THCR Corp.
and the related transactions thereto (collectively, the "Taj Merger
Transaction") and pursuant to the Second Amended and Restated Partnership
Agreement of the Partnership, dated as of April 17, 1996, (the "Second Amended
Partnership Agreement") (filed as Exhibit I.I and incorporated herein by
reference), the percentage of Trump's Limited Partnership Interest changed to
approximately 20.7% and TCI became a new limited partner of the Partnership with
an approximately 4.4% limited partnership interest ("TCI's Limited Partnership
Interest"). Trump's Limited Partnership Interest and
<PAGE>
Page 10
TCI's Limited Partnership Interest represented the economic interests of Mr.
Trump and TCI in the assets and operations of the Partnership. Pursuant to the
terms of the Amended and Restated Exchange and Registration Rights Agreement
among the Company, Mr. Trump and TCI, dated as of April 17, 1996 (the "Amended
Exchange Rights Agreement") (filed as Exhibit II.I and incorporated herein by
reference), Trump's Limited Partnership Interest was convertible, at Mr. Trump's
option, into 6,674,006 shares of Common Stock and TCI's Limited Partnership
Interest was convertible, at TCI's option, into 1,407,017 shares of Common
Stock. As a result of the Taj Merger Transaction, on April 17, 1996, Mr. Trump
and TCI held 800 and 200 shares of the Class B Stock, respectively.
Consideration for the change in Trump's Limited Partnership Interest and
TCI's acquisition of TCI's Limited Partnership Interest in the Taj Merger
Transaction was the contribution to the Partnership, pursuant to the terms of
the 1996 Contribution Agreement among Mr. Trump, TCI, THCR/LP and the
Partnership, dated as of April 17, 1996 (the "1996 Contribution Agreement")
(filed as Exhibit III.I and incorporated herein by reference), of (i) 20 shares
of Common Stock of AC Corporation by Mr. Trump and (ii) a 49.995% general
partnership interest in Trump Taj Mahal Associates ("Taj Associates"), the owner
and operator of the Taj Mahal, by TCI.
As part of the Taj Merger Transaction, Mr. Trump was also issued warrants
(the "Trump Warrants") (filed as Exhibit V and incorporated herein by reference)
to purchase an aggregate of
<PAGE>
Page 11
1.8 million shares of Common Stock, of which (i) 600,000 shares may be purchased
on or before April 17, 1999 at $30.00 per share, (ii) 600,000 shares may be
purchased on or before April 17, 2000 at $35.00 per share and (iii) 600,000
shares may be purchased on or before April 17, 2001 at 40.00 per share.
On October 7, 1996, in connection with the acquisition (the "Castle
Acquisition") by the Partnership of all the outstanding equity interests of
Trump's Castle Associates ("Castle Associates"), the owner and operator of
Trump's Castle, and pursuant to the Third Amended and Restated Partnership
Agreement of the Partnership, dated as of October 7, 1996, (the "Third Amended
Partnership Agreement") (filed as Exhibit I.II and incorporated herein by
reference), the percentage of Trump's Limited Partnership Interest and TCI's
Limited Partnership Interest changed to approximately 27.1% and 3.7%,
respectively, and TCI-II became a new limited partner of the Partnership with an
approximately 5.8% limited partnership interest ("TCI-II's Limited Partnership
Interest" and collectively with Trump's Limited Partnership Interest and TCI's
Limited Partnership Interest, the "Limited Partnership Interests"). Because TCI
and TCI-II are wholly owned by Mr. Trump, Mr. Trump may be deemed to
beneficially own the Limited Partnership Interests (an approximately 36.6%
limited partnership interest in the Partnership). The Limited Partnership
Interests represent the economic interests of Mr. Trump, TCI and TCI-II in the
assets and operations of the Partnership. Pursuant to the terms of the Second
Amended and Restated Exchange and Registration Rights
<PAGE>
Page 12
Agreement among the Company, Mr. Trump, TCI and TCI-II, dated as of October 7,
1996 (the "Second Amended Exchange Rights Agreement") (filed as Exhibit II.I and
incorporated herein by reference), Trump's Limited Partnership Interest is
convertible, at Mr. Trump's option, into 10,300,456 shares of Common Stock (the
"Trump Conversion Shares"), TCI's Limited Partnership Interest is convertible,
at TCI's option, into 1,407,017 shares of Common Stock (the "TCI Conversion
Shares") and TCI-II's Limited Partnership Interest is convertible, at TCI-II's
option, into 2,211,250 shares of Common Stock (the "TCI-II Conversion Shares"
and collectively with the Trump Conversion Shares and the TCI Conversion Shares,
the "Conversion Shares").
As a result of the Castle Acquisition, as of October 7, 1996, Mr. Trump,
TCI and TCI-II held 850, 50, and 100 shares of the Class B Stock, respectively.
Upon conversion of all or any portion of any of the Reporting Persons' Limited
Partnership Interest into shares of Common Stock, the corresponding voting power
of their respective Class B Stock will be proportionately diminished in an
amount equal to the number of shares of Common Stock issued upon such
conversion.
Consideration for the change in Trump's Limited Partnership Interest and
TCI-II's acquisition of TCI-II's Limited Partnership Interest in the Castle
Acquisition was the contribution to the Partnership, pursuant to the terms of
the Agreement, dated as of June 24, 1996, as amended, by and among the Company,
the Partnership, TCI-II, TCHI and Mr. Trump (the "Castle Acquisition Agreement")
(filed as Exhibit VIII and
<PAGE>
Page 13
incorporated herein by reference), of Mr. Trump's and TCI-II's 61.5% and 37.5%
equity interests in Castle Associates, respectively
Item 4. PURPOSE OF TRANSACTION.
Each of the Reporting Persons acquired their Limited Partnership Interest,
and Mr. Trump acquired the Trump Shares and the Trump Warrants, for the purpose
of acquiring an equity investment in the Company.
Each of the Reporting Persons may convert his or its Limited Partnership
Interest at any time into Common Stock or may acquire from time to time
additional Common Stock through open-market or privately negotiated transactions
depending on existing market conditions and other considerations discussed
below. Each of the Reporting Persons intends to review his investment in the
Company on a continuing basis and, depending upon the price and availability of
the Common Stock, subsequent developments affecting the Company, the Company's
business and prospects, other investment and business opportunities available to
the Reporting Persons, general stock market and economic conditions, tax
considerations and other factors considered relevant, may decide at any time to
increase or decrease the size of his investment in the Company.
Except as set forth herein, none of the Reporting Persons has plans or
proposals which relate to or would result in the following: (a) the acquisition
by any person of additional securities of the Company, or the disposition of
securities of the Company; (b) an extraordinary corporate transaction, such as
<PAGE>
Page 14
a merger, reorganization or liquidation, involving the Company or any of its
subsidiaries; (c) a sale or transfer of a material amount of assets of the
Company or any of its subsidiaries; (d) any change in the present Board of
Directors or management of the Company, including any plans or proposals to
change the number or term of Directors or to fill any existing vacancies on the
Board of Directors; (e) any material change in the present capitalization or
dividend policy of the Company; (f) any other material change in the Company's
business or corporate structure; (g) changes in the Company's charter, by-laws
or instruments corresponding thereto or other actions which may impede the
acquisition of control of the Company by any person; (h) causing a class of
securities of the Company to be delisted from a national securities exchange or
to cease to be authorized to be quoted in an inter-dealer quotation system of a
registered national securities association; (i) a class of equity securities of
the Company becoming eligible for termination of registration pursuant to
Section 12(g)(4) of the Exchange Act; or (j) any action similar to any of those
enumerated above.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
(a), (b). As of the date hereof, the aggregate number and percentage of
shares of Common Stock beneficially owned by each of the Reporting Persons
(assuming in each case full conversion of their respective Limited Partnership
Interest and, in the case of Mr. Trump, the exercise of the Trump Warrants),
including the number of shares of Common Stock as to which the Reporting Person
has sole power to vote or direct the vote,
<PAGE>
Page 15
shared power to vote or direct the vote, sole power to dispose or direct the
disposition or shared power to dispose or direct the disposition, are set forth
in the table below.
The total number of shares of Common Stock outstanding, as of October 7,
1996, was 24,140,090 shares (the "Outstanding Shares").
<PAGE>
Page 16
<TABLE>
<CAPTION>
Aggregate
Number Number of Number of Number of Number of Adjusted Percent of
of Shares Shares with Shares with Shares with Shares with Number of Shares
Reporting Beneficially Sole Power Shared Power Sole Power Shared Power Shares Beneficially
Person Owned to Vote to Vote to Dispose to Dispose Outstanding Owned
- -------- ------------ ----------- ------------ ---------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Mr. Trump 15,719,248 12,100,706(1) 3,618,542(2) 12,100,706(1) 3,618,542(2) 39,858,813(3) 39.4%
TCI 1,407,017 0 1,407,017(4) 0 1,407,017(5) 25,547,107(6) 5.5%
TCI-II 2,211,250 0 2,211,250(4) 0 2,211,250(5) 26,351,340(7) 8.4%
</TABLE>
- --------------------
(1) Consists of (i) the Trump Shares, (ii) the Trump Conversion Shares and
(iii) the shares into which the Trump Warrants are convertible.
(2) Consists of (i) 225 shares of Common Stock acquired by Mrs. Trump, on June
7, 1995, in a regular-way transaction at $14.00 per share (the "Spouse
Shares"), (ii) the Gift Shares, (iii) the TCI Conversion Shares and (iv)
the TCI-II Conversion Shares. Mrs. Trump holds 75 of the Spouse Shares for
her own account, 100 as custodian for her sister Danielle Nicole Maples and
50 as custodian for her daughter Tiffany Trump. Mr. Trump shares voting and
dispositive power over the TCI Conversion Shares and the TCI-II Conversion
Shares with TCI and TCI-II, respectively, and over the Spouse Shares and
Gift Shares with Mrs. Trump. Mr. Trump disclaims beneficial ownership of
the Gift Shares and the Spouse Shares.
(3) Calculated by adding the Conversion Shares, the shares into which the Trump
Warrants are convertible and the Outstanding Shares.
(4) Voting power shared with Mr. Trump.
(5) Dispositive power shared with Mr. Trump.
(6) Calculated by adding the TCI Conversion Shares and the Outstanding Shares.
(7) Calculated by adding the TCI-II Conversion Shares and the Outstanding
Shares.
<PAGE>
Page 17
(c). Within the past sixty (60) days, the Reporting Persons effected the
following transaction in the Common Stock:
As further described in Item 3, on October 7, 1996, the Reporting
Persons acquired the Limited Partnership Interests.
(d). Not applicable.
(e). Not applicable.
Item 6. Contracts, Arrangements, Understandings or RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
The Original Partnership Agreement provided, among other provisions, that
no additional Partnership interests would be issued, except in the case of (i)
an additional partnership interest to the Company in exchange for a contribution
of value from the Company and (ii) an additional limited partnership interest to
Mr. Trump or his Permitted Holders (as defined therein) in exchange for a
contribution of value from Mr. Trump or his Permitted Holders, as determined by
a majority of the Special Committee of the Company's Board of Directors (the
"Special Committee"). The Company covenanted in the Original Partnership
Agreement that it would not issue additional debt or equity securities, unless
the proceeds of such issuance were contributed to the Partnership and that it
would not issue any additional shares of Class B Common Stock, except to Mr.
Trump or his Permitted Holders.
The Second Amended Partnership Agreement had similar terms to those of the
Original Partnership Agreement and allowed for the issuance of limited
partnership interests to TCI and
<PAGE>
Page 18
THCR/LP in exchange for their contribution to the Partnership, in connection
with the Taj Merger, of their respective 49.995% equity interests in Taj
Associates. In addition, the Second Amended Partnership Agreement provided that
the Company may contribute to Trump AC the indirect interest in Taj Associates
that the Company acquired in the Taj Merger and the proceeds of the Company's
offering of 13,250,000 shares of Common Stock consummated in connection with the
Taj Merger Transaction.
The Third Amended Partnership Agreement has similar terms to those of the
Second Amended Partnership Agreement and allows for the issuance of the Limited
Partnership Interests as set forth in the Castle Acquisition Agreement.
Pursuant to the Exchange Rights Agreement, among other things: (i) Mr.
Trump and his permitted successors and assigns were able to exchange all or any
portion of their partnership interest in the Partnership for Common Stock, and
(ii) a majority of the Special Committee had the right to require any holder of
a limited partnership interest in the Partnership (other than Mr. Trump and his
Permitted Holders) to exchange their Partnership interests for Common Stock. The
number of shares of Common Stock issuable upon exchange of limited interests in
the Partnership would be adjusted from time to time to reflect stock dividends,
stock splits, reverse stock splits, reclassifications and recapitalizations.
The Exchange Rights Agreement contained certain registration rights under
the Securities Act of 1933 (the "Securities Act") in favor of the holders of the
Common Stock
<PAGE>
Page 19
issuable upon the exchange of limited partnership interests in the Partnership.
The holders of securities representing a majority of the Common Stock issuable
upon the exchange of limited partnership interests in the Partnership had the
right to require the Company, at the Company's expense (other than with respect
to underwriting discounts, commissions and fees attributable to the sale of any
such Common Stock), subject to certain limitations, to file two registration
statements relating to the resale to the public of all or a portion of their
Common Stock. In addition, in the event the Company proposed to register any of
its Common Stock pursuant to a registration statement under the Securities Act
(other than on Forms S-4 or S-8 under the Securities Act or other similar
successor forms), such holders could have, by giving written notice to the
Company, requested that the Company, at the Company's expense (other than with
respect to underwriting discounts, commissions and fees attributable to the sale
of any such Common Stock), include in such registered offering all or any part
of their Common Stock. The Company was required to include the securities
covered by such notice or notices in such registered offering unless the Company
determines for any reason not to proceed with the underlying offering of its
equity securities or, in the case of an underwritten offering, if the managing
underwriter determines that the amount of Common Stock requested to be included
in such registration exceeds the amount which could be sold in such offering
without adversely affecting the distribution of the securities being offered.
<PAGE>
Page 20
The Amended Exchange Rights Agreement granted Mr. Trump similar conversion
and registration rights afforded to him under the Exchange Rights Agreement and
extended such rights to TCI. The Second Amended Exchange Rights Agreement grants
Mr. Trump and TCI similar conversion and registration rights afforded to him
under the Amended Exchange Rights Agreement and extends such rights to TCI-II.
The shares of Common Stock issuable upon the exercise of the Trump Warrants
have registration rights similar to those held by Mr. Trump under the Second
Amended Exchange Rights Agreement.
On April 17, 1996, Mr. Trump entered into a transaction with Donaldson
Lufkin & Jenrette, Inc. ("DLJ") to satisfy certain indebtedness of Mr. Trump and
his affiliates and to obtain certain releases of liens and guarantees necessary
to effect the Taj Merger Transaction. In connection therewith, and pursuant to
the terms of the Pledge and Security Agreement among Mr. Trump, TCI and DLJ,
dated as of April 17, 1996 (the "DLJ Pledge Agreement") (filed as Exhibit VI.I
and incorporated herein by reference), Trump and TCI granted to DLJ (i) a first
priority security interest on (A) then owned Trump's Limited Partnership
Interest, (B) 800 shares of Class B Stock that Trump held on April 17, 1996 and
(C) the rights of Trump and TCI under the Amended Exchange Rights Agreement and
(ii) a security interest, subject to a first priority security interest in favor
of Citibank, N.A. ("Citibank") pursuant to the Citibank Pledge Agreement (as
defined), on (A) then owned TCI's Limited
<PAGE>
Page 21
Partnership Interest and (B) 200 shares of Class B Stock that TCI held on April
17, 1996.
On April 17, 1996, Mr. Trump also restructured certain of his personal
indebtedness and obtained the consent of the lenders necessary to effect the Taj
Merger Transaction. In connection therewith, and pursuant to the terms of the
Pledge and Security Agreement among Mr. Trump, certain of Mr. Trump's affiliates
(including TCI) and Citibank, as agent for the lenders, dated as of April 17,
1996 (the "Citibank Pledge Agreement") (filed as Exhibit VI.II and incorporated
herein by reference), Trump and TCI granted to Citibank (i) a first priority
security interest on certain of Mr. Trump's assets and interests, including (A)
the Trump Warrants, (B) then owned TCI's Limited Partnership Interest and (C)
200 shares of Class B Stock that TCI held on April 17, 1996, and (ii) a security
interest, subject to a first priority security interest in favor of DLJ pursuant
to the DLJ Pledge Agreement, on (A) then owned Trump's Limited Partnership
InteFrest and (B) 800 shares of Class B Stock that Trump held on April 17, 1996.
On October 7, 1996, Mr. Trump satisfied his obligations to Citibank and
Citibank terminated the liens granted under the Citibank Pledge Agreement.
Accordingly, and in view of the increase in Trump's Limited Partnership Interest
as a result of the Castle Acquisition, on October 7, 1996, DLJ had a security
interest on (i) a portion of Trump's Limited Partnership Interest, consisting of
a 17.53603% limited partnership interest in the Partnership (the "Trump/DLJ
Limited Partnership
<PAGE>
Page 22
Interest"), (ii) TCI's Limited Partnership Interest (collectively with the
Trump/DLJ Limited Partnership Interest, the "DLJ Securities"), (iii) 800 shares
of Mr. Trump's Class B Stock, representing a voting power in the Company equal
to the number of shares of Common Stock issuable upon the exchange of the
Trump/DLJ Limited Partnership Interest, (iv) all of the 50 shares of TCI's Class
B Stock, representing a voting power in the Company equal to the number of
shares of Common Stock issuable upon the exchange of the TCI's Limited
Partnership Interest, and (v) the rights of Trump and TCI under the Second
Amended Exchange Rights Agreement.
Pursuant to the terms of a Registration Agreement among Mr. Trump, TCI,
TCI-II, the Company and DLJ, dated as of October 7, 1996 (the "Registration
Agreement") (filed as Exhibit VI.III and incorporated herein by reference), (i)
Mr. Trump agreed that if he exercises his rights (each a "Trump Exercise") under
the Second Amended Exchange Rights Agreement (the "Registration Rights") with
respect Trump's Limited Partnership Interests not pledged to DLJ (the "Trump
Securities"), he will simultaneously exercise the Registration Rights with
respect to the DLJ Securities. However, Mr. Trump is not obligated to exercise
the Registration Rights with respect to the DLJ Securities if either (i) the
aggregate fair market value of the shares of Common Stock into which the Trump
Securities are exchanged in each and all of the Trump Exercises is less than $10
million, (ii) the aggregate number of shares of Common Stock into which the
Trump Securities are exchanged in each and all of the Trump Exercises is less
than
<PAGE>
Page 23
500,000 shares or (iii) Mr. Trump obtains the prior written consent of DLJ. In
addition, the Reporting Persons and the Company agreed that, in the case of an
event of default under the DLJ Pledge Agreement, (i) the right to make any
Blackout Determination (as defined in the Second Amended Exchange Rights
Agreement) shall be waived with respect to any request to exercise the
Registration Rights with respect to the DLJ Securities and (ii) if Trump
exercises the Registration Rights with respect to the Trump Securities, DLJ, at
its option, shall have the right to exercise (or cause Mr. Trump to exercise)
the Registration Rights with respect to the DLJ Securities prior to or
simultaneously with any exercise of the Registration Rights with respect to the
Trump Securities.
Because of the relationship between Mr. Trump, TCI and TCI-II, the
Reporting Persons may be deemed to form a "group" within the meaning of Rule
13d-5 under the Exchange Act. TCI and TCI-II disclaim beneficial ownership of
any shares held by Mr. Trump.
Except as otherwise described in this statement, to the best knowledge of
the undersigned, there are no other contracts, arrangements, understandings or
relationships (legal or otherwise) between or among any of the Reporting Persons
and any other person with respect to any securities of the Company, 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 or
profits, division of profits or loss, or the giving or withholding of proxies.
<PAGE>
Page 24
* * * * *
Item 7 is hereby amended by deleting Exhibits IV, IV.I and IV.II in their
entirety and adding the following new Exhibits:
EXHIBIT I.II: Third Amended and Restated Agreement of Limited Partnership
of Trump Hotels & Casino Resorts Holdings, L.P., dated as of October 7, 1996.
EXHIBIT II.I: Second Amended and Restated Exchange and Registration Rights
Agreement among Donald J. Trump, Trump Casinos, Inc., Trump Casinos II, Inc. and
Trump Hotels & Casino Resorts, Inc., dated as of October 7, 1996.
EXHIBIT VI.III: Registration Agreement among Donald J. Trump, Trump
Casinos, Inc., Trump Casinos II, Inc. Trump Hotels & Casino Resorts Inc. and
Donaldson Lufkin & Jenrette, Inc., dated as of October 7, 1996.
EXHIBIT VII.I: Joint Filing Agreement between Donald J. Trump, Trump
Casinos, Inc. and Trump Casinos II, Inc., dated as of October 7, 1996.
EXHIBIT VIII: Agreement by an among Trump Hotels & Casino Resorts, Inc.,
Trump Hotels & Casino Resorts Holdings, L.P., TC/GP, Inc. (currently known as
Trump Casinos II, Inc.), Trump's Castle Hotel & Casino, Inc. and Donald J.
Trump, dated as of June 24, 1996, as amended.
<PAGE>
Page 25
After reasonable inquiry and to the best knowledge and belief of the
undersigned, each of the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: October 16, 1996
/S/ DONALD J. TRUMP
--------------------------------
Donald J. Trump
TRUMP CASINOS, INC.
By: /s/ DONALD J. TRUMP
----------------------------
Name: Donald J. Trump
Title: Sole Director,
President and
Treasurer
TRUMP CASINOS II, INC.
By: /s/ DONALD J. TRUMP
----------------------------
Name: Donald J. Trump
Title: Sole Director,
President and
Treasurer
EXHIBIT I.II
- --------------------------------------------------------------------------------
THIRD AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I. DEFINITIONS .................................................... 2
Section 1.1. DEFINITIONS ................................................ 2
Section 1.2. ACCOUNTING TERMS AND DETERMINATIONS.........................17
ARTICLE II. CONTINUATION OF PARTNERSHIP; BUSINESS OF PARTNERSHIP...........17
Section 2.1. CONTINUATION ...............................................17
Section 2.2. NAME .......................................................17
Section 2.3. CHARACTER OF THE BUSINESS...................................18
Section 2.4. LOCATION OF PRINCIPAL PLACE OF BUSINESS.....................18
Section 2.5. REGISTERED AGENT AND REGISTERED OFFICE......................18
ARTICLE III. TERM .........................................................18
Section 3.1. COMMENCEMENT ...............................................18
Section 3.2. TERMINATION ................................................18
ARTICLE IV. CAPITAL CONTRIBUTIONS..........................................18
Section 4.1. CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS
AND PERCENTAGE INTERESTS OF THE PARTNERS...................18
Section 4.2. ISSUANCE OF ADDITIONAL PARTNERSHIP INTERESTS
AND SHARES.................................................20
Section 4.3. ADJUSTMENT OF PARTNERSHIP INTERESTS.........................22
Section 4.4. NO INTEREST ON OR RETURN OF CAPITAL CONTRIBUTION............22
Section 4.5. ADJUSTMENT FOR CASTLE ACQUISITION...........................22
ARTICLE V. ALLOCATIONS AND OTHER TAX AND ACCOUNTING MATTERS................22
Section 5.1. ALLOCATIONS OF NET INCOME AND NET LOSS......................22
Section 5.2. SPECIAL ALLOCATIONS.........................................23
Section 5.3. TAX ALLOCATIONS.............................................25
Section 5.4. BOOKS OF ACCOUNT............................................27
Section 5.5. TAX MATTERS PARTNER.........................................27
Section 5.6. TAX ELECTIONS AND RETURNS...................................28
Section 5.7. TAX CERTIFICATIONS..........................................29
ARTICLE VI. DISTRIBUTIONS..................................................30
Section 6.1. GENERAL.....................................................30
Section 6.2. DISTRIBUTIONS FOR TAXES.....................................30
Section 6.3. OTHER DISTRIBUTIONS.........................................31
Section 6.4. WITHHOLDING PAYMENTS REQUIRED BY LAW........................31
Section 6.5. NON-RECOURSE................................................32
ARTICLE VII. RIGHTS, DUTIES AND RESTRICTIONS OF THE GENERAL PARTNER........33
Section 7.1. POWERS AND DUTIES OF GENERAL PARTNER........................33
Section 7.2. MAJOR DECISIONS.............................................36
Section 7.3. REIMBURSEMENT OF THE GENERAL PARTNER........................36
<PAGE>
Section 7.4. OUTSIDE ACTIVITIES OF THE GENERAL PARTNER...................37
Section 7.5. CONTRACTS WITH AFFILIATES...................................37
Section 7.6. TITLE TO PARTNERSHIP ASSETS.................................38
Section 7.7. RELIANCE BY THIRD PARTIES...................................38
Section 7.8. LIABILITY OF THE GENERAL PARTNER............................39
Section 7.9. OFFICERS OF THE PARTNERSHIP.................................39
Section 7.10. COVENANTS OF THCR REGARDING THE ISSUANCE OF NEW
SECURITIES..................................................39
Section 7.11. OTHER MATTERS CONCERNING THE GENERAL PARTNER................40
ARTICLE VIII. DISSOLUTION, LIQUIDATION AND WINDING-UP......................41
Section 8.1. ACCOUNTING..................................................41
Section 8.2. DISTRIBUTION ON DISSOLUTION.................................41
Section 8.3. TIMING REQUIREMENTS.........................................41
Section 8.4. DOCUMENTATION OF LIQUIDATION................................42
Section 8.5. DISSOLUTION.................................................42
Section 8.6. CONTINUATION OF THE PARTNERSHIP.............................43
ARTICLE IX. TRANSFER AND REDEMPTION OF PARTNERSHIP INTERESTS; CERTAIN
CONSENT RIGHTS................................................43
Section 9.1. GENERAL PARTNER TRANSFER....................................43
Section 9.2. TRANSFERS BY LIMITED PARTNERS...............................44
Section 9.3. CERTAIN ADDITIONAL RESTRICTIONS ON TRANSFER.................47
Section 9.4. EFFECTIVE DATES OF TRANSFERS................................47
Section 9.5. TRANSFER....................................................48
Section 9.6. REDEMPTION OF PARTNERSHIP INTEREST..........................49
Section 9.7. CERTAIN CONSENT RIGHTS......................................49
ARTICLE X. RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS..................49
Section 10.1. NO PARTICIPATION IN MANAGEMENT.............................49
Section 10.2. BANKRUPTCY OF A LIMITED PARTNER............................50
Section 10.3. NO WITHDRAWAL..............................................50
Section 10.4. CONFLICTS..................................................50
Section 10.5. PROVISION OF INFORMATION...................................51
Section 10.6. LIMITED PARTNER REPRESENTATIVE.............................52
Section 10.7. POWER OF ATTORNEY..........................................52
ARTICLE XI. INDEMNIFICATION; EXCULPATION...................................54
Section 11.1. INDEMNIFICATION............................................54
Section 11.2. INDEMNIFICATION PROCEDURES.................................55
Section 11.3. EXCULPATION................................................56
Section 11.4. NO LIABILITY OF DIRECTORS AND OTHERS.......................56
ARTICLE XII. RIGHTS UNDER THE EXCHANGE RIGHTS AGREEMENT....................57
Section 12.1. TRANSFER PURSUANT TO EXCHANGE RIGHTS AGREEMENT.............57
Section 12.2. SUBJECT TO THE EXCHANGE RIGHTS AGREEMENT...................57
ARTICLE XIII. AMENDMENT OF PARTNERSHIP AGREEMENT, MEETINGS.................57
Section 13.1. AMENDMENTS.................................................57
Section 13.2. MEETINGS OF THE PARTNERS; NOTICES TO PARTNERS..............59
(ii)
<PAGE>
ARTICLE XIV. CERTIFICATE OF INTEREST.......................................60
Section 14.1. FORM OF CERTIFICATE OF INTEREST............................60
Section 14.2. TRANSFERS OF CERTIFICATES OF INTEREST......................60
Section 14.3. LOST, STOLEN, DESTROYED OR MUTILATED CERTIFICATES
OF INTEREST...............................................61
Section 14.4. INSPECTION OF CERTIFICATE TRANSFER LEDGER..................61
ARTICLE XV. REGULATORY REQUIREMENTS........................................61
Section 15.1. APPLICABLE REGULATORY AUTHORITY AND CCC REGULATION.........61
Section 15.2. ADDITIONAL APPLICABLE REGULATORY AUTHORITY REGULATION......62
Section 15.3. DISQUALIFIED HOLDERS.......................................62
ARTICLE XVI. GENERAL PROVISIONS............................................63
Section 16.1. NOTICES....................................................63
Section 16.2. CONTROLLING LAW............................................64
Section 16.3. NO THIRD PARTY BENEFICIARIES...............................64
Section 16.4. EXECUTION IN COUNTERPARTS..................................64
Section 16.5. PROVISIONS SEPARABLE.......................................64
Section 16.6. ENTIRE AGREEMENT...........................................64
Section 16.7. PARAGRAPH HEADINGS.........................................65
Section 16.8. GENDER, ETC................................................65
Section 16.9. NUMBER OF DAYS.............................................65
Section 16.10. PARTNERS NOT AGENTS.......................................65
Section 16.11. ASSURANCES................................................65
Section 16.12. SUCCESSORS AND ASSIGNS....................................65
Section 16.13. WAIVER....................................................65
SCHEDULES
SCHEDULE I -- Aggregate Capital Contributions
SCHEDULE II -- Capital Contributions Prior to April 17, 1996
SCHEDULE III -- Capital Contributions in connection with the Taj Mahal Merger
Transaction
SCHEDULE IV -- Capital Contributions in connection with the Castle Acquisition
EXHIBITS
EXHIBIT A -- Form of Second Amended and Restated Exchange and Registration
Rights Agreement
(iii)
<PAGE>
THE LIMITED PARTNERSHIP INTERESTS REFERRED TO IN THIS AGREEMENT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS. REFERENCE IS MADE TO ARTICLE IX OF THIS
AGREEMENT FOR PROVISIONS RELATING TO VARIOUS RESTRICTIONS ON THE SALE
OR OTHER TRANSFER OF THESE INTERESTS.
THIRD AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
THIS THIRD AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP is made
and entered into this 7th day of October, 1996, by and among Trump Hotels &
Casino Resorts, Inc., a Delaware corporation ("THCR"), Donald J. Trump ("Trump"
or the "Initial Limited Partner"), THCR/LP Corporation, a New Jersey corporation
("THCR/LP"), Trump Casinos, Inc., a New Jersey corporation ("TCI"), Trump
Casinos II, Inc., a Delaware Corporation, formerly known as TC/GP, Inc.
("TCI-II"), and the Persons who may become party hereto from time to time
pursuant to the terms of this Agreement.
W I T N E S S E T H:
WHEREAS, THCR and Trump formed the Partnership on March 28, 1995 by the
filing of a Certificate of Limited Partnership with the Secretary of State of
the State of Delaware;
WHEREAS, THCR and Trump entered into an Amended and Restated Agreement of
Limited Partnership on June 12, 1995;
WHEREAS, in connection with the acquisition by the Partnership of Trump Taj
Mahal Associates ("Taj Associates") and the other transactions related thereto
(the "Taj Mahal Merger Transaction"), THCR, Trump, THCR/LP and TCI entered into
a Second Amended and Restated Agreement of Limited Partnership, dated as of
April 17, 1996, which provided for the capital contributions as set forth on
Schedule III hereto and the admission of THCR/LP and TCI as Limited Partners of
the Partnership;
WHEREAS, effective as of the date hereof, the General Partner and Trump
desire to cause certain capital contributions to the Partnership, as set forth
on Schedule IV hereto, in connection with the acquisition (the "Castle
Acquisition") by the Partnership of the equity interests of Trump's Castle
Associates, L.P., a New Jersey limited partnership ("Castle Associates");
<PAGE>
WHEREAS, in exchange for its capital contribution as set forth in Schedule
IV, effective as of the date hereof, TCI-II is being admitted to the Partnership
as a Limited Partner; and
WHEREAS, the parties hereto desire to continue the Partnership as a limited
partnership under the Delaware Revised Uniform Limited Partnership Act in
accordance with the provisions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt,
adequacy and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
ARTICLE I.
DEFINITIONS
Section 1.1. DEFINITIONS. Except as otherwise herein expressly provided,
the following terms and phrases shall have the meanings as set forth below:
"ACCOUNTANTS" shall mean the national firm or firms of independent
certified public accountants selected by the General Partner on behalf of the
Partnership to audit the books and records of the Partnership and to prepare
statements and reports in connection therewith, which initially shall be Arthur
Andersen LLP.
"ACT" shall mean the Delaware Revised Uniform Limited Partnership Act, as
the same may hereafter be amended from time to time.
"ACTION" shall mean any and all claims, demands, actions, suits or
proceedings, civil, criminal, administrative or investigative, that give rise to
a claim for indemnification pursuant to Article XI hereof.
"ADDITIONAL DISTRIBUTIONS" shall mean distributions by the Partnership
pursuant to Section 6.3 hereof.
"ADDITIONAL PARTNERSHIP INTERESTS" shall have the meaning set forth in
Section 4.2(a).
"ADJUSTED CAPITAL ACCOUNT DEFICIT" shall mean, with respect to any Limited
Partner, the deficit balance, if any, in such Partner's Capital Account as of
the end of any relevant fiscal year and after giving effect to the following
adjustments:
(a) credit to such Capital Account any amounts which such Partner is
obligated or treated as obligated
-2-
<PAGE>
to restore with respect to any deficit balance in such Capital Account
pursuant to Section 1.704-1(b)(2)(ii)(c) of the Regulations, or is deemed
to be obligated to restore with respect to any deficit balance pursuant to
the penultimate sentences of Sections 1.704-2(g)(1) and 1.704-2(i)(5) of
the Regulations; and
(b) debit to such Capital Account the items described in Sections
1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Regulations.
The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the requirements of the alternate test for economic effect
contained in Section 1.704-1(b)(2)(ii)(d) of the Regulations and shall be
interpreted consistently therewith.
"ADJUSTMENT DATE" shall have the meaning set forth in Section 4.3 hereof.
"AFFILIATE" shall mean, with respect to any specified Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, such specified Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise.
"AGREEMENT" shall mean this Third Amended and Restated Agreement of Limited
Partnership, as originally executed and as amended, modified, supplemented or
restated from time to time, as the context requires.
"APPLICABLE REGULATORY AUTHORITY" shall mean any governmental or
quasi-governmental authority with applicable jurisdiction over the business,
affairs, securities, or properties of the Partnership or any of its
Subsidiaries, including, without limitation, the CCC, the IGC, and the MGC.
"AUDITED FINANCIAL STATEMENTS" shall mean financial statements (balance
sheet, statement of income, statement of partners' equity and statement of cash
flows) prepared in accordance with GAAP and accompanied by an independent
auditor's report containing an opinion thereon.
"BANKRUPTCY" shall mean, with respect to any Person, (i) the commencement
by such Person of any petition, case or proceeding seeking relief under any
provision or chapter of the federal bankruptcy code or any other federal or
state law relating to insolvency, bankruptcy or reorganization, (ii) an
adjudication that such Person is insolvent or bankrupt, (iii) the entry of an
order for relief under the federal bankruptcy code with respect to such Person,
(iv) the filing of any such petition
-3-
<PAGE>
or the commencement of any such case or proceeding against such Person, unless
such petition and the case or proceeding initiated thereby are dismissed within
ninety (90) days from the date of such filing or (v) the filing of an answer by
such Person admitting the allegations of any such petition.
"BENEFICIAL OWNER" shall mean any Person who, singly or together with any
of such Person's Affiliates, directly or indirectly, has "beneficial ownership"
of Partnership Interests (as determined pursuant to Rule 13d-3 of the Securities
Exchange Act of 1934, as amended).
"BUSINESS DAY" shall mean any day that is not a Saturday, Sunday or a day
on which banking institutions in the State of New York are authorized or
obligated by law or executive order to close.
"CAPITAL ACCOUNT" shall mean, with respect to any Partner, the separate
"book" account which the Partnership shall establish and maintain for such
Partner in accordance with Section 704(b) of the Code and the Regulations
promulgated thereunder. In the event that a Partnership Interest is transferred
in accordance with the terms of this Agreement, the Capital Account, at the time
of the transfer, of the transferor attributable to the transferred interest
shall carry over to the transferee.
"CAPITAL CONTRIBUTION" shall mean, with respect to any Partner, the amount
of money and the initial Gross Asset Value of any Contributed Property (net of
liabilities to which such property is subject) set forth on Schedule I, as such
exhibit will be amended by the General Partner from time to time to reflect the
amount of money and the Gross Asset Value of any Contributed Property received
by the Partnership pursuant to any additional Capital Contribution or deemed
contributed pursuant to Sections 4.2 or 7.10.
"CASINO CONTROL ACT" shall mean the New Jersey Casino Control Act, N.J.S.A.
5:12-1 ET SEQ.
"CASTLE ACQUISITION" shall have the meaning set forth in the Recitals to
this Agreement.
"CASTLE ACQUISITION AGREEMENT" shall mean the Agreement, dated as of June
24, 1996, by and among THCR, the Partnership, TCI-II, TCHI and Trump, as amended
as of August 27, 1996.
"CASTLE ASSOCIATES" shall have the meaning set forth in the Recitals to
this Agreement.
"CCC" shall mean the New Jersey Casino Control Commission and any successor
agency.
-4-
<PAGE>
"CERTIFICATE" shall mean the Certificate of Limited Partnership
establishing the Partnership, as filed with the office of the Delaware Secretary
of State on March 28, 1995, as it may be amended from time to time in accordance
with the terms of this Agreement and the Act.
"CLASS B STOCK" shall mean Class B Common Stock, par value $.01 per share,
of THCR, and any class of securities into which the Class B Stock has been
converted, other than Common Stock.
"CODE" shall mean the Internal Revenue Code of 1986, as amended and in
effect from time to time, as interpreted by the applicable regulations
thereunder. Any reference herein to a specific section or sections of the Code
shall be deemed to include a reference to any corresponding provision of future
law.
"COMMON STOCK" shall mean the common stock, par value $.01 per share, of
THCR, other than the Class B Stock.
"CONSENT OF THE LIMITED PARTNERS" shall mean the written consent of a
Majority-In-Interest of the Limited Partners given in accordance with Section
13.2 hereof, which consent shall be obtained prior to the taking of any action
for which it is required by this Agreement and may be given or withheld by a
Majority-In-Interest of the Limited Partners, unless otherwise expressly
provided herein, in their sole and absolute discretion.
"CONTRIBUTED PROPERTY" shall mean any property or asset, in such form as
may be permitted by the Act, but excluding cash, contributed or deemed
contributed to the Partnership with respect to the Partnership Interest held by
each Partner.
"CURRENT MARKET PRICE" shall mean, with respect to any security on any
Valuation Date specified herein, the arithmetic mean over a period of twenty
consecutive trading days ending the second trading day prior to such date (a) if
the security is listed or admitted to trading on any national securities
exchange, of the high and low sale price of the security or if no such sale
takes place on such date, the average of the highest closing bid and lowest
closing asked prices thereof on such date, in each case as officially reported
on all national securities exchanges on which the security is then listed or
admitted to trading, (b) if the security is not then listed or admitted to
trading on any national securities exchange, the highest closing price thereof
on such date in the over-the-counter market as shown by the NASDAQ National
Market System, or (c) if the security is not then quoted in such system, as
published by the National Quotation Bureau, Incorporated or any similar
successor organization, and in any case as reported by any member firm of the
New York Stock Exchange selected by the General Partner. If the security is not
then listed or admitted to trading on any national securities exchange and if no
closing bid and ask prices therefor are then quoted or published in the
-5-
<PAGE>
over-the-counter market, "Current Market Price" shall mean the value of the
security as of a date which is 15 days preceding the date as of which the
determination is to be made, as determined in good faith by an investment
banking firm of national reputation (which firm may have provided other services
to the General Partner or the Partnership) selected by the Board of Directors of
the General Partner, and, in connection with a Capital Contribution by the
Initial Limited Partner or his Permitted Holders, which selection shall be
approved by a majority of the Special Committee. Notwithstanding the foregoing,
if a determination of Current Market Price is being made in connection with an
arms length underwritten public offering, such value shall be the public
offering price of the Common Stock in such offering.
"DAMAGES" shall have the meaning set forth in Section 11.1(a) hereof.
"DEEMED PARTNERSHIP INTEREST VALUE" as of any date, shall mean with respect
to a Partner, the Deemed Value of the Partnership (as of the day preceding such
date) multiplied by such Partner's Percentage Interest (expressed as a decimal
carried to four places, e.g., .1234 or 12.34%).
"DEEMED VALUE OF THE PARTNERSHIP" shall mean, as of the Valuation Date, (a)
the sum of (i) the product of (A) the Current Market Price per share of Common
Stock, (B) the number of shares of outstanding Common Stock, and (C) a fraction,
the numerator of which is one, and the denominator of which is the Percentage
Interest (expressed as a decimal) of the General Partner, (ii) the aggregate
Fair Market Value of the outstanding capital stock of THCR, other than the
Common Stock or the Class B Stock, and (iii) the Fair Market Value of the
outstanding Indebtedness of THCR appearing on the balance sheet of THCR,
prepared in accordance with GAAP, as of the Valuation Date, which Indebtedness
(the "Included Indebtedness") shall exclude (A) the Indebtedness of the
Partnership and its consolidated and combined Subsidiaries, appearing on the
balance sheet of the Partnership and its consolidated and combined Subsidiaries,
prepared in accordance with GAAP as of the Valuation Date, and (B) any other
Indebtedness appearing on the balance sheet of THCR, prepared in accordance with
GAAP, as of the Valuation Date, the proceeds of which were not used to purchase
additional Partnership Interests, reduced by (b) the amount, if any, by which
the consolidated net worth of the General Partner exceeds its pro rata share of
the consolidated net worth of the Partnership; PROVIDED, HOWEVER, that if the
General Partner shall have material amounts of liabilities (other than Included
Indebtedness) or material assets other than cash and Partnership Interests, the
General Partner may seek the advice of an investment banking firm of national
reputation as to the appropriate modification of the Deemed Value of the
Partnership formula set forth herein to take into account such liabilities or
assets.
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"DEPRECIATION" shall mean, with respect to any asset of the Partnership for
any fiscal year or other period, the depreciation or amortization, as the case
may be, allowed or allowable for federal income tax purposes in respect of such
asset for such fiscal year or other period; PROVIDED, HOWEVER, that if there is
a difference between the Gross Asset Value and the adjusted tax basis of such
asset, Depreciation shall mean "book depreciation, depletion or amortization" as
determined under Section 1.704-1(b)(2)(iv)(g)(3) of the Regulations.
"DISABLING EVENT" shall have the meaning set forth in Section 8.6 hereof.
"DISQUALIFIED HOLDER" shall mean any Beneficial Owner of Partnership
Interests or Equity Interests of the General Partner, the Partnership or any of
its Subsidiaries (a) who is found to be disqualified by any Applicable
Regulatory Authority, or (b) whose holding of such Partnership Interests or
Equity Interests may result or, when taken together with the holding of such
Partnership Interests or Equity Interests by any other Beneficial Owner, may
result, in the judgment of the General Partner, in the inability to obtain, loss
or non-reinstatement of any license or franchise from any Applicable Regulatory
Authority sought or held by the Partnership or any Subsidiary to conduct any
portion of the business of the Partnership or any Subsidiary, which license or
franchise is conditioned upon some or all of the holders of Partnership
Interests and such Equity Interests meeting certain criteria.
"ENTITY" shall mean any general partnership, limited partnership, limited
liability company, corporation, joint venture, trust, business trust, real
estate investment trust, association or other entity.
"EQUITY INTEREST" of any Person shall mean any shares, interests,
participations or other equivalents (however designated) of such Person in
equity.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time (or any corresponding provisions of succeeding laws).
"EXCHANGE RIGHTS AGREEMENT" shall mean the Second Amended and Restated
Exchange and Registration Rights Agreement, dated as of October 7, 1996,
substantially in the form of Exhibit A hereto, entered into by and among Trump,
TCI, TCI-II and THCR, providing certain rights to exchange Limited Partnership
Interests for Common Stock on the terms and conditions set forth therein, as the
same may be amended from time to time in accordance with the terms thereof.
"EXECUTIVE AGREEMENT" shall mean the Trump Executive Agreement, by and
among Trump, THCR and the
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Partnership, dated as of June 12, 1995, as the same may be amended from time to
time in accordance with the terms thereof.
"FAIR MARKET VALUE" shall mean (i) in the case of any security, its Current
Market Price and (ii) in the case of any property or Indebtedness that is not a
security, the fair market value of such property or Indebtedness as determined
in good faith by a majority of the Board of Directors of the General Partner
and, in connection with a Capital Contribution by the Initial Limited Partner or
his Permitted Holders, by a majority of the Special Committee.
"FORECLOSURE SALE" shall mean any judicial sale or any sale of collateral
conducted by a pledgee in exercising its rights under the Uniform Commercial
Code.
"GENERAL PARTNER" shall mean THCR, its duly admitted successors and assigns
and any other Person who is a general partner of the Partnership at the time of
reference thereto.
"GENERAL PARTNER EXPENSES" shall mean all organization, formation,
administrative and operating costs and expenses of the General Partner,
including, but not limited to, (a) salaries paid to officers of the General
Partner, and insurance, accounting, legal, and other professional fees and
expenses incurred by the General Partner, (b) costs and expenses relating to the
organization, formation and continuity of existence of the Partnership and the
General Partner, including franchise taxes, fees and assessments associated
therewith, any and all costs, expenses or fees payable or reimbursable to, or in
respect of, any director or officer of the General Partner, (c) costs and
expenses relating to any offer or registration of securities by the General
Partner or the Partnership and all statements, reports, fees and expenses
incidental thereto, including Issuance Costs applicable to any such offer of
securities, (d) costs and expenses associated with compliance by the General
Partner with laws, rules and regulations promulgated by any Applicable
Regulatory Authority, including the SEC, and (e) any costs and expenses incurred
in connection with any matter for which the General Partner may seek
indemnification from the Partnership pursuant to the provisions of this
Agreement; PROVIDED, HOWEVER, that "General Partner Expenses" shall not include,
(i) any taxes taken into account in calculating Tax Amounts, and (ii) any
administrative and operating costs and expenses of the General Partner to the
extent arising out of any Outside Business Activities.
"GROSS ASSET VALUE" shall mean, with respect to any asset of the
Partnership, such asset's adjusted basis for federal income tax purposes, except
as follows:
(a) the initial Gross Asset Value of any asset contributed by a
Partner to the Partnership shall be
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(i) in the case of any asset described on attached Schedule I, the gross
fair market value ascribed thereto on such Schedule and (ii) in the case of
any other asset hereafter contributed by a Partner, the gross Fair Market
Value of such asset at the time of its contribution, which determination,
in the case of the Initial Limited Partner and his Permitted Holders, shall
be made by a majority of the Special Committee;
(b) the Gross Asset Values of all Partnership assets shall be adjusted
to equal their respective gross Fair Market Values:
(i) immediately prior to a Capital Contribution (other than a de
minimis Capital Contribution) to the Partnership by a new or existing
Partner as consideration for a Partnership Interest;
(ii) immediately prior to the distribution by the Partnership to
a Partner of more than a de minimis amount of Partnership property as
consideration for the redemption of a Partnership Interest;
(iii) immediately prior to the liquidation of the Partnership
within the meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations;
and
(iv) upon any other event as to which the General Partner
reasonably determines that an adjustment is necessary or appropriate
to reflect the relative economic interests of the Partners;
(c) the Gross Asset Values of Partnership assets distributed to any
Partner shall be the gross Fair Market Values of such assets as of the date
of distribution; and
(d) the Gross Asset Values of Partnership assets shall be increased
(or decreased) to reflect any adjustments to the adjusted basis of such
assets pursuant to Sections 734(b) or 743(b) of the Code, but only to the
extent that such adjustments are taken into account in determining Capital
Accounts pursuant to Section 1.704-1(b)(2)(iv)(m) of the Regulations;
PROVIDED, HOWEVER, that Gross Asset Values shall not be adjusted pursuant
to this paragraph to the extent that the General Partner reasonably
determines that an adjustment pursuant to paragraph (b) above is necessary
or appropriate in connection with a transaction that would otherwise result
in an adjustment pursuant to this paragraph (d).
At all times, Gross Asset Values shall be adjusted by any Depreciation taken
into account with respect to the Partnership's
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assets for purposes of computing Net Income and Net Loss. Any adjustment to the
Gross Asset Values of Partnership property shall require an adjustment to the
Partners' Capital Accounts; as for the manner in which such adjustments are
allocated to the Capital Accounts, see clause (c) of the definition of Net
Income and Net Loss in the case of adjustment by Depreciation, and clause (d) of
said definition in all other cases.
"IGC" shall mean the Indiana Gaming Commission and any successor agency.
"INDEBTEDNESS" shall mean any obligation, whether or not contingent, (i) in
respect of borrowed money or evidenced by bonds, notes, debentures or similar
instruments, (ii) representing the balance deferred and unpaid of the purchase
price of any property (including pursuant to capital leases), except any such
balance that constitutes an accrued expense or a trade payable, if and to the
extent any of the foregoing indebtedness would appear as a liability upon a
balance sheet prepared on a consolidated basis in accordance with GAAP, (iii) to
the extent not otherwise included, obligations under interest rate exchange,
currency exchange, swaps, futures or similar agreements, and (iv) guaranties
(other than endorsements for collection or deposit in the ordinary course of
business), direct or indirect, in any manner (including, without limitation,
reimbursement agreements in respect of letters of credit), of all or any part of
any Indebtedness of any third party.
"INDEMNITEE" shall mean any Person made or threatened to be made a party to
a proceeding by reason of its status as a Partner or a trustee, director,
officer, employee, agent, stockholder or Liquidating Trustee of the Partnership,
a Partner or an Affiliate of a Partner.
"INDIANA RIVERBOAT" shall mean a riverboat or dockside gaming facility and
the ancillary structures and other facilities used in connection with the
operation thereof located in Buffington Harbor, Indiana.
"INDIANA RIVERBOAT ACT" shall mean the Indiana Riverboat Gambling Act, Ind.
Code ss. 4-33-1-1 ET SEQ.
"INITIAL LIMITED PARTNER" shall have the meaning set forth in the Preamble
to this Agreement.
"ISSUANCE COSTS" shall mean the underwriter's discount, placement fees,
commissions or other expenses relating to the issuance of New Securities by the
General Partner.
"LIEN" shall mean any liens, security interests, mortgages, deeds of trust,
pledges, options, escrows, collateral assignments, rights of first offer or
first refusal, preemptive rights and any other similar encumbrances of any
nature whatsoever.
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"LIMITED PARTNER REPRESENTATIVE" shall have the meaning set forth in
Section 10.6 hereof.
"LIMITED PARTNERS" shall mean the Initial Limited Partner, those Persons
listed under the heading "Limited Partners" on the signature page hereto in
their respective capacities as limited partners of the Partnership, their
permitted successors or assigns as limited partners hereof, and any Person who,
at the time of reference thereto, is a limited partner of the Partnership.
"LIQUIDATING TRUSTEE" shall mean such individual or Entity which is
selected as the Liquidating Trustee hereunder by the General Partner, which
individual or Entity may include the General Partner or an Affiliate of the
General Partner; PROVIDED THAT, such Liquidating Trustee agrees in writing to be
bound by the terms of this Agreement. The Liquidating Trustee shall be empowered
to give and receive notices, reports and payments in connection with the
dissolution, liquidation and/or winding up of the Partnership and shall hold and
exercise such other rights and powers granted to the General Partner herein or
under the Act as are necessary or required to conduct the winding-up and
liquidation of the Partnership's affairs and to authorize all parties to deal
with the Liquidating Trustee in connection with the dissolution, liquidation
and/or winding-up of the Partnership.
"MAJOR DECISIONS" shall have the meaning set forth in Section 7.2 hereof.
"MAJORITY-IN-INTEREST OF THE LIMITED PARTNERS" shall mean Limited
Partner(s) (excluding the General Partner to the extent it Beneficially Owns any
limited Partnership Interest) who hold in the aggregate more than fifty (50)
percent of the Percentage Interests then allocable to and held by the Limited
Partners (excluding the General Partner to the extent it Beneficially Owns any
limited Partnership Interest), as a class.
"MGC" shall mean the Mississippi Gaming Commission and any successor
agency.
"MINIMUM GAIN ATTRIBUTABLE TO PARTNER NONRECOURSE DEBT" shall mean "partner
nonrecourse debt minimum gain" as determined in accordance with Regulation
Section 1.704-2(i)(3).
"MISSISSIPPI GAMING CONTROL ACT" shall mean the Gaming Control Act of
Mississippi, Miss. Code ss. 75-76-1 ET SEQ.
"NET INCOME" or "NET LOSS" shall mean, for each fiscal year or other
applicable period, an amount equal to the Partnership's net income or loss for
such year or period as determined for federal income tax purposes by the
Accountants, determined in accordance with Section 703(a) of the Code (for
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this purpose, all items of income, gain, loss or deduction required to be stated
separately pursuant to Section 703(a) of the Code shall be included in taxable
income or loss), with the following adjustments: (a) by including as an item of
gross income any tax-exempt income received by the Partnership; (b) by treating
as a deductible expense any expenditure of the Partnership described in Section
705(a)(2)(B) of the Code (including amounts paid or incurred to organize the
Partnership (unless an election is made pursuant to Code Section 709(b)) or to
promote the sale of interests in the Partnership and by treating deductions for
any losses incurred in connection with the sale or exchange of Partnership
property disallowed pursuant to Section 267(a)(1) or Section 707(b) of the Code
as expenditures described in Section 705(a)(2)(B) of the Code); (c) in lieu of
depreciation, depletion, amortization and other cost recovery deductions taken
into account in computing total income or loss, there shall be taken into
account Depreciation; (d) gain or loss resulting from any disposition of
Partnership property with respect to which gain or loss is recognized for
federal income tax purposes shall be computed by reference to the Gross Asset
Value of such property rather than its adjusted tax basis; (e) in the event of
an adjustment of the Gross Asset Value of any Partnership asset which requires
that the Capital Accounts of the Partnership be adjusted pursuant to Regulation
Section 1.704-1(b)(2)(iv)(e), (f) and (m), the amount of such adjustment is to
be taken into account as additional Net Income or Net Loss pursuant to Section
5.1; and (f) excluding any items specially allocated pursuant to Section 5.2.
Once an item of income, gain, loss or deduction has been included in the initial
computation of Net Income or Net Loss and is subjected to the special allocation
rules in Section 5.2, Net Income and Net Loss shall be computed without regard
to such item.
"NEW SECURITIES" means Indebtedness or Equity Interests of the General
Partner and any of its Subsidiaries other than the Partnership and its
Subsidiaries; PROVIDED THAT, New Securities shall not include Class B Stock and
Common Stock issued by THCR prior to the date of this Agreement.
"NONRECOURSE DEDUCTIONS" shall have the meaning set forth in Sections
1.704-2(b)(1) and (c) of the Regulations.
"NONRECOURSE LIABILITIES" shall have the meaning set forth in Section
1.704-2(b)(3) of the Regulations.
"OUTSIDE BUSINESS ACTIVITY" shall mean any business other than (i) the
ownership, acquisition and disposition of Partnership Interests as a General
Partner or Limited Partner and (ii) the management of the business of the
Partnership, and such activities as are incidental thereto, including, without
limitation, the issuance of New Securities and the application of the proceeds
thereof in compliance with the provisions of Section 7.10 of this Agreement.
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"PARTNER NONRECOURSE DEBT" shall have the meaning set forth in Section
1.704-2(b)(4) of the Regulations.
"PARTNER NONRECOURSE DEDUCTIONS" shall have the meaning set forth in
Section 1.704-2(i)(2) of the Regulations.
"PARTNERS" shall mean the General Partner and the Limited Partners, their
duly admitted successors or assigns or any Person who is a partner of the
Partnership at the time of reference thereto.
"PARTNERSHIP" shall mean the limited partnership formed under the Act
pursuant to this Agreement, and any successor thereto.
"PARTNERSHIP INTEREST" shall mean the ownership interest of a Partner in
the Partnership from time to time, including each Partner's Percentage Interest
and such Partner's Capital Account. Wherever in this Agreement reference is made
to a particular Partner's Partnership Interest it shall be deemed to refer to
such Partner's Percentage Interest and shall include the proportionate amount of
such Partner's other interests in the Partnership which are attributable to or
based upon the Partner's Partnership Interest.
"PARTNERSHIP MINIMUM GAIN" shall have the meaning set forth in Section
1.704-2(b)(2) of the Regulations.
"PERCENTAGE INTEREST" shall mean, with respect to any Partner, the
percentage ownership interest of such Partner in such items of the Partnership
as to which the term "Percentage Interests" is applied in this Agreement, as
specified in Schedule I hereto, as such Schedule may be amended from time to
time.
"PERMITTED HOLDER" with respect to any Partner shall mean (i) such Partner
and (ii) if a natural person, the spouse and descendants of such Partner
(including any related trusts controlled by, and established and maintained for
the sole benefit of, such Partner or such spouse or descendants) and the estate
of any of the foregoing. In addition, (x) TCI and Trump and (y) TCI-II and Trump
shall each be Permitted Holders in respect of each other.
"PERMITTED LIMITED PARTNERSHIP INTEREST LIEN" shall mean any Lien to which
the limited Partnership Interest of a Limited Partner is subject; PROVIDED THAT,
the terms of such Lien (other than a Lien on the proceeds (as defined in Section
9-306 of the Uniform Commercial Code) of, or right to receive distributions or
payments with respect to, a limited Partnership Interest) must expressly
acknowledge that the rights of the holder of such Lien, upon foreclosure, will
be subject to the terms of the Exchange Rights Agreement.
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"PERMITTED PARTNERS" shall have the meaning set forth in Section 5.1(b)(ii)
hereof.
"PERSON" shall mean any natural person or Entity.
"PLAZA ASSOCIATES" shall mean Trump Plaza Associates, a New Jersey general
partnership.
"REDEMPTION DATE" shall mean the date fixed by the General Partner for the
redemption of any Partnership Interests pursuant to Article XV hereof.
"REDEMPTION SECURITIES" shall mean any debt or equity securities of the
Partnership, any Subsidiary or any other corporation, or any combination
thereof, having such terms and conditions as shall be approved by the General
Partner and which, together with any cash to be paid as part of the redemption
price, in the opinion of any nationally recognized investment banking firm
selected by the General Partner (which may be a firm which provides other
investment banking, brokerage or other services to the Partnership), has a
value, at the time notice of redemption is given pursuant to Section 15.3, at
least equal to the Fair Market Value of the Partnership Interests to be redeemed
pursuant to Article XV (assuming, in the case of Redemption Securities to be
publicly traded, such Redemption Securities were fully distributed and subject
only to normal trading activity).
"REGULATIONS" shall mean the income tax regulations promulgated under the
Code, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"RESTRICTED PARTNER" shall have the meaning set forth in Section 5.1(b)(ii)
hereof.
"RIGHTS" shall mean the exchange rights as provided in the Exchange Rights
Agreement.
"SEC" shall mean the United States Securities and Exchange Commission.
"SPECIAL COMMITTEE" shall mean a committee of at least two (2) of the
members of the board of directors of the General Partner, composed solely of
directors who are not officers or employees of the General Partner and who are
not Affiliates of Trump or any of his Affiliates; PROVIDED THAT, a director
shall not be deemed to be an Affiliate of either Trump or his Affiliates solely
by reason of his or her being a member of the board of directors of the General
Partner or its Subsidiaries.
"STOCK INCENTIVE PLAN" shall mean the General Partner's 1995 Stock Option
Plan and such successor or additional plan as the General Partner may adopt.
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"STOCK OPTION" shall mean an option to purchase Shares granted under the
Stock Incentive Plan.
"SUBSIDIARY" with respect to any Person shall mean a "subsidiary" as
defined in Section 1-02 of Regulation S-X promulgated under the Securities Act
of 1933, as amended.
"TAJ ASSOCIATES" shall have the meaning set forth in the Recitals to this
Agreement.
"TAJ MAHAL" shall mean the Trump Taj Mahal Casino Resort and the ancillary
structures and other facilities used in connection with the operation thereof
located in Atlantic City, New Jersey.
"TAJ MAHAL MERGER TRANSACTION" shall have the meaning set forth in the
Recitals to this Agreement.
"TAX AMOUNTS" with respect to any year shall not exceed an amount equal to
(a) the higher of (i) the product of (A) the taxable income of the Partnership
(computed as if the Partnership were an individual) for such year as determined
in good faith by the board of directors of the General Partner and (B) the Tax
Percentage and (ii) the product of (A) the alternative minimum taxable income
attributable to the Partnership (computed as if the Partnership were an
individual) for such year as determined in good faith by the board of directors
of the General Partner and (B) the Tax Percentage, reduced by (b) to the extent
not previously taken into account, any income tax benefit attributable to the
Partnership which could be realized (without regard to the actual realization)
by its Partners in the current or any prior taxable year, or portion thereof,
commencing on the date of this Agreement (including any tax losses or tax
credits), computed at the applicable Tax Percentage for the year that such
benefit is taken into account for purposes of this computation. Any part of the
Tax Amount not distributed in respect of a tax period for which it is calculated
shall be available for distribution in subsequent tax periods.
"TAX DISTRIBUTION" shall mean distributions by the Partnership pursuant to
Section 6.2 hereof.
"TAX ITEMS" shall have the meaning set forth in Section 5.3(a).
"TAX PAYMENT LOAN" shall have the meaning set forth in Section 6.4(a)
hereof.
"TAX PERCENTAGE" shall mean the highest, aggregate effective marginal rate
of Federal, state and local income tax or, when applicable, alternative minimum
tax, to which any Partner would be subject in the relevant year of determination
(as certified to the General Partner by the Accountants);
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PROVIDED, HOWEVER, that in no event shall the Tax Percentage be greater than the
sum of (x) the highest, aggregate effective marginal rate of Federal, state, and
local income tax, or when applicable, alternative minimum tax, to which the
Partnership would have been subject if it were a C corporation for Federal
income tax purposes, and (y) 5 percentage points. If any Partner is an S
corporation, partnership, or similar pass-through entity for Federal income tax
purposes, the Tax Percentage shall be computed based upon the tax rates
applicable to the shareholder or partner of such Partner, as the case may be.
"TCHI" shall mean Trump's Castle Hotel & Casino, Inc., a New Jersey
corporation.
"TCI" shall mean Trump Casinos, Inc., a New Jersey corporation.
"TCI-II" shall have the meaning set forth in the Preamble to this
Agreement.
"THCR" shall mean Trump Hotels & Casino Resorts, Inc., a Delaware
corporation.
"THCR/LP" shall mean THCR/LP Corporation, a New Jersey corporation.
"TRADING DAY" shall mean a day on which the principal national securities
exchange on which the Common Stock is listed or admitted to trading is open for
the transaction of business or, if the Common Stock is are not listed or
admitted to trading on any national securities exchange, shall mean a Business
Day.
"TRANSFER" shall have the meaning set forth in Section 9.5.
"TRANSFER DETERMINATION" shall have the meaning set forth in Section
9.2(c).
"TRUMP" shall have the meaning set forth in the Preamble to this Agreement.
"TRUMP AC" shall mean Trump Atlantic City Associates, a New Jersey general
partnership.
"TRUMP PLAZA" shall mean the Trump Plaza Hotel and Casino and the ancillary
structures and other facilities used in connection with the operation thereof
located in Atlantic City, New Jersey.
"TRUMP'S CASTLE" shall mean Trump's Castle Casino Resort and the ancillary
structures and other facilities used in connection with the operation thereof
located in Atlantic City, New Jersey.
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"TRUMP'S CASTLE PROPERTY" shall have the meaning set forth in Section
5.3(c) hereof.
"VALUATION DATE" shall mean any date as of which the value of New
Securities, the Partnership, or any other property is to be determined for
purposes of this Agreement.
"WITHHOLDING TAX ACT" shall have the meaning set forth in Section 6.6(a)
hereof.
Section 1.2. ACCOUNTING TERMS AND DETERMINATIONS. All references in this
Agreement to "generally accepted accounting principles" or "GAAP" shall mean
generally accepted accounting principles in effect in the United States of
America at the time of application thereof. Unless otherwise specified herein,
all accounting terms used herein shall be interpreted, all determinations with
respect to accounting matters hereunder shall be made, and all financial
statements and certificates and reports as to financial matters required to be
furnished hereunder shall be prepared, in accordance with generally accepted
accounting principles, applied on a consistent basis.
ARTICLE II.
CONTINUATION OF PARTNERSHIP; BUSINESS OF PARTNERSHIP
Section 2.1. CONTINUATION. The parties hereto do hereby agree to continue
the Partnership as a limited partnership pursuant to the provisions of the Act,
for the purposes and upon the terms and conditions hereinafter set forth. The
Partners agree that the rights and liabilities of the Partners shall be as
provided in the Act, except as otherwise herein expressly provided.
Section 2.2 NAME.
(a) Subject to the provisions of paragraph (b) below, the name of the
Partnership shall be Trump Hotels & Casino Resorts Holdings, L.P. or such
other name as shall be chosen from time to time by the General Partner in
its sole and absolute discretion. The inclusion of Trump's name in the name
of the Partnership shall not be deemed to be evidence that Trump
participates in the control of the business within the meaning of Section
17-303 of the Act or any comparable provision.
(b) The Partnership shall conduct business and qualify as a foreign
limited partnership under an assumed name, which shall not include the name
of any Limited Partner, in any jurisdiction where the inclusion of a
Limited Partner's name in the name of the Partnership would subject such
Limited Partner to general liability for the Partnership's debts.
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Section 2.3. CHARACTER OF THE BUSINESS. The purpose and business of the
Partnership is through its Affiliates and Subsidiaries (a) to conduct casino
gaming and to own and/or operate (i) Trump Plaza, (ii) the Taj Mahal, (iii) the
Indiana Riverboat, (iv) Trump's Castle and (v) such other gaming properties and
facilities as the Partnership may acquire in the future; (b) to do all things
necessary, incidental, desirable or appropriate in connection with the
foregoing; and (c) to otherwise engage in any enterprise or business in which a
limited partnership may engage or conduct under the Act.
Section 2.4. LOCATION OF PRINCIPAL PLACE OF BUSINESS. The location of the
principal place of business of the Partnership shall be at 2500 Boardwalk,
Atlantic City, New Jersey 08401, or such other location as shall be selected
from time to time by the General Partner in its sole and absolute discretion.
Section 2.5. REGISTERED AGENT AND REGISTERED OFFICE. The registered agent
of the Partnership shall be The Corporation Trust Company, or such other Person
as the General Partner may select in its sole and absolute discretion. The
registered office of the Partnership in the State of Delaware shall be 1209
Orange Street, Wilmington, Delaware or such other location as the General
Partner may from time to time select in its sole discretion.
ARTICLE III.
TERM
Section 3.1. COMMENCEMENT. The Partnership's term commenced upon the filing
of the Certificate with the Secretary of State of Delaware on March 28, 1995.
Section 3.2. TERMINATION. The Partnership shall terminate on the close of
business on the 31st day of December 2035, unless sooner terminated pursuant to
Article VIII hereof.
ARTICLE IV.
CAPITAL CONTRIBUTIONS
Section 4.1. CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS AND PERCENTAGE
INTERESTS OF THE PARTNERS
(a) Prior to the date hereof, (I) the General Partner and the Initial
Limited Partner made or caused to be made the Capital Contributions set
forth opposite their respective names on Schedule II hereto and (II) the
General Partner, the Initial Limited Partner, THCR/LP and TCI made the
Capital Contributions set forth opposite their
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respective names on Schedule III hereto, and THCR/LP and TCI became Limited
Partners of the Partnership. Effective as of the date hereof, the Initial
Limited Partner and TCI-II shall make or cause to be made the Capital
Contributions set forth opposite their respective names on Schedule IV
hereto, and TCI-II shall become a Limited Partner of the Partnership. The
General Partner, the Initial Limited Partner, THCR/LP and TCI hereby
consent to the admission of TCI-II as a Limited Partner of the Partnership.
As of the date hereof, each Partner shall have made or caused to be made
the Capital Contributions set forth opposite such Partner's name on
Schedule I hereto (which shall reflect the aggregate of such Partner's
Capital Contributions as set forth on Schedules II, III and IV), and each
Partner shall have the Percentage Interests in the Partnership set forth
opposite such Partner's name in Schedule I, which Percentage Interests
shall be adjusted as provided in Schedule I as amended by the General
Partner from time to time after the date hereof to the extent necessary to
reflect properly redemptions or conversions of Partnership Interests,
Capital Contributions, the issuance of Additional Partnership Interests or
any other event having an effect on a Partner's Percentage Interest, in
each case to the extent permitted by and in accordance with this Agreement.
Except to the extent specifically set forth in this Agreement with respect
to the General Partner, the Partners shall have no obligation to make any
additional Capital Contributions or loans to the Partnership, even if the
failure to do so could result in the Bankruptcy or insolvency of the
Partnership or any other adverse consequence to the Partnership. All
surtax, documentary stamp tax or other transfer tax that may be imposed as
a result of the foregoing Capital Contributions shall be paid by the
Partnership.
(b) Except as provided by law, (i) no Limited Partner shall be liable
for any deficit in its Capital Account or (ii) except as provided in
Section 6.2(b), be obligated to return any distributions of any kind
received from the Partnership.
(c) So long as the Initial Limited Partner and his Permitted Holders
collectively beneficially own more than 10% of the issued and outstanding
Partnership Interests, the General Partner shall notify such Partners no
less than 60 days prior to any reduction of nonrecourse indebtedness or
other indebtedness which such Partner may include in the basis of its
interest in the Partnership (other than scheduled repayments of principal)
in an amount greater than $10 million during any fiscal year. Upon receipt
of such notice, such Partners shall be permitted, at their own expense, to
undertake any action they desire to increase the "economic risk of loss,"
within the meaning of Regulation section 1.752-2, that the Initial Limited
Partner and his Permitted Holders have with respect to the
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liabilities of the Partnership; PROVIDED, HOWEVER, that the Initial Limited
Partner and his Permitted Holders may not undertake any action that would
have, in the reasonable judgment of a majority of the Special Committee, a
material adverse tax impact on the Partnership, the General Partner or
other Limited Partners. If the Initial Limited Partner or his Permitted
Holders wish to undertake any action permitted pursuant to this section
4.1(c), the General Partner shall endeavor to cooperate with such Partners,
PROVIDED THAT, such Partners shall promptly reimburse the General Partner
for any reasonable costs incurred in providing such cooperation.
Section 4.2. ISSUANCE OF ADDITIONAL PARTNERSHIP INTERESTS AND SHARES.
(a) The General Partner is authorized to cause the Partnership from
time to time to issue to the General Partner, THCR/LP, the Initial Limited
Partner and his Permitted Holders, TCI, and TCI-II, Partnership Interests
("ADDITIONAL PARTNERSHIP INTERESTS") in one or more classes, or one or more
series of any of such classes, with such designations, preferences and
participating, optional or other special rights, powers and duties,
including rights, powers and duties which may be senior to interests in the
Partnership theretofore issued, for consideration not less than the Fair
Market Value thereof, and on such terms and conditions as shall be
determined by the General Partner and, which special rights, powers and
duties, without limitation, may relate to (i) the allocations of items of
Partnership income, gain, loss, deduction and credit to each such class or
series of Partnership Interests; (ii) the right of each such class or
series of Partnership Interests to share in Partnership distributions; and
(iii) the rights of each such class or series of Partnership Interests upon
dissolution and liquidation of the Partnership.
(b) No Additional Partnership Interests shall be issued to the General
Partner or any Subsidiary or nominee of the General Partner, unless either
(i) the Additional Partnership Interests are issued in connection
with an issuance of New Securities, the General Partner complies with
all of the provisions of this Agreement, including, without
limitation, Section 7.10(b) and (A) if such New Securities are Common
Stock, such Additional Partnership Interests have terms equivalent to
the Partnership Interest originally issued to the General Partner
hereunder; PROVIDED, HOWEVER, in the case of the issuance of Common
Stock as compensation for services rendered, the General Partner shall
be deemed to have contributed to the Partnership as a Capital
Contribution pursuant to Section 4.3 hereof an amount
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equal to the product of (x) the Fair Market Value of the Common Stock
(as of the Trading Day immediately preceding the date of issue of the
deferred stock to such recipient), times (y) the number of shares of
deferred Common Stock issued by the General Partner to such recipient;
(B) if such New Securities are Stock Options, no Additional
Partnership Interests shall be issued at the time of the issuance of
such Stock Options; PROVIDED THAT, upon the exercise of such Stock
Options, the General Partner shall contribute to the capital of the
Partnership an amount equal to the exercise price of such Stock
Options and shall be deemed to have contributed to the Partnership as
a Capital Contribution pursuant to Section 4.3 hereof an amount
equal to the product of (x) the Fair Market Value of the Common Stock
(as of the Valuation Day immediately preceding the date on which the
Stock Options are exercised), and (y) the number of shares of Common
Stock issued upon the exercise of such Stock Options, and (C) if such
New Securities are other than Common Stock or Stock Options, such
Additional Partnership Interests have conversion, subscription,
purchase and other terms equivalent to the terms of such New
Securities;
(ii) the Additional Partnership Interests are issued to all
Partners in proportion to their respective Percentage Interests;
(iii) Additional Partnership Interests are issued in connection
with any other contribution of value made by the General Partner to
the Partnership not otherwise described in clauses (i) and (ii) of
this Section 4.2(b); or
(iv) the Additional Partnership Interests are issued with the
written consent of all of the Limited Partners given in accordance
with Section 13.2 hereof.
(c) No Person shall have any preemptive, preferential or other similar
right with respect to (i) additional Capital Contributions or loans to the
Partnership; or (ii) issuance or sale of any Partnership Interests.
(d) The General Partner is hereby authorized on behalf of each of the
Partners to amend this Agreement solely to reflect any increase in the
Percentage Interests of any Partner and the corresponding reduction of the
Percentage Interests of the other Partners in accordance with the
provisions of this Section 4.2, and the General Partner shall promptly send
a copy of such amendment to each Limited Partner.
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Section 4.3. ADJUSTMENT OF PARTNERSHIP INTERESTS. Except with respect to a
Capital Contribution described in Section 4.2(b)(i)(C), effective on each date
on which a Partner has made a Capital Contribution to the Partnership (each an
"Adjustment Date"), the Percentage Interest of each Partner shall be adjusted,
which adjustment in the case of a Capital Contribution by the Initial Limited
Partner or his Permitted Holders shall be subject to the approval of a majority
of the Special Committee, such that the Percentage Interest of the Partner shall
be equal to a fraction, (a) the numerator of which is equal to the sum of (i)
the Deemed Partnership Interest Value of such Partner (computed as of the
Trading Day immediately preceding the Adjustment Date) and (ii) the amount of
the Capital Contribution contributed by such Partner on such Adjustment Date,
and (b) the denominator of which is equal to the sum of (i) the Deemed Value of
the Partnership (computed as of the Trading Day immediately preceding the
Adjustment Date) and (ii) the amount of the Capital Contribution contributed by
all Partners on such Adjustment Date. The General Partner shall promptly give
each Limited Partner written notice of its Percentage Interest, as adjusted, and
the Gross Asset Value shall be adjusted.
Section 4.4. NO INTEREST ON OR RETURN OF CAPITAL CONTRIBUTION. No Partner
shall be entitled to interest on its Capital Contribution or Capital Account.
Except as provided herein or by law, no Partner shall have any right to demand
or receive the return of its Capital Contribution.
Section 4.5. ADJUSTMENT FOR CASTLE ACQUISITION. Notwithstanding anything
to the contrary contained in this Agreement, the adjustments to the Partnership
Interest of each Partner with respect to the Castle Acquisition shall be as set
forth in Schedule I and Schedule IV hereof.
ARTICLE V.
ALLOCATIONS AND OTHER TAX AND ACCOUNTING MATTERS
The Net Income, Net Loss and/or other Partnership items shall be allocated
as follows:
Section 5.1. ALLOCATIONS OF NET INCOME AND NET LOSS.
(a) NET INCOME. Except as otherwise provided herein, Net Income for
any fiscal year or other applicable period shall be allocated in the
following order and priority:
(i) First, to the Partners, until the cumulative Net Income
allocated pursuant to this subparagraph (a)(i) for the current and all
prior periods equals the cumulative Net Loss allocated pursuant to
subparagraph (b)(ii) hereof for all prior
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periods, among the Partners in the reverse order that such Net Loss
was allocated to the Permitted Partners pursuant to subparagraph
(b)(ii) hereof.
(ii) Thereafter, the balance of the Net Income, if any, shall be
allocated to the Partners in accordance with their respective
Percentage Interests.
(b) NET LOSS. Except as otherwise provided herein, Net Loss of the
Partnership for each fiscal year or other applicable period shall be
allocated as follows:
(i) To the Partners in accordance with their respective
Percentage Interests.
(ii) Notwithstanding subparagraph (b)(i) hereof, to the extent
any Net Loss allocated to a Partner under subparagraph (b)(i) hereof
or this subparagraph (b)(ii) would cause such Partner (a "RESTRICTED
PARTNER") to have an Adjusted Capital Account Deficit as of the end of
the fiscal year to which such Net Loss relates, such Net Loss shall
not be allocated to such Restricted Partner and instead shall be
allocated to the other Partner(s) (the "PERMITTED PARTNERS") pro rata
in accordance with their relative Percentage Interests.
Section 5.2. SPECIAL ALLOCATIONS. Notwithstanding any provisions of Section
5.1, the following special allocations shall be made, to the least extent
necessary to satisfy section 704(b) of the Code and the Regulations promulgated
thereunder, in the following order:
(a) MINIMUM GAIN CHARGEBACK (NONRECOURSE LIABILITIES). If there is a
net decrease in Partnership Minimum Gain for any Partnership fiscal year
(except as a result of conversion or refinancing of Partnership
indebtedness, certain capital contributions or revaluation of the
Partnership property as further outlined in Regulation Sections
1.704-2(d)(4), (f)(2) or (f)(3)), each Partner shall be specially allocated
items of Partnership income and gain for such year (and, if necessary,
subsequent years) in an amount equal to that Partner's share of the net
decrease in Partnership Minimum Gain. The items to be so allocated shall be
determined in accordance with Regulation Section 1.704-2(f)(6). This
paragraph (a) is intended to comply with the minimum gain chargeback
requirement in said section of the Regulations and shall be interpreted
consistently therewith. Allocations pursuant to this paragraph (a) shall be
made in proportion to the respective amounts required to be allocated to
each Partner pursuant hereto.
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(b) MINIMUM GAIN ATTRIBUTABLE TO PARTNER NONRECOURSE DEBT. If there is
a net decrease in Minimum Gain Attributable to Partner Nonrecourse Debt
during any fiscal year (other than due to the conversion, refinancing or
other change in the debt instrument causing it to become partially or
wholly nonrecourse, certain capital contributions, or certain revaluations
of Partnership property (as further outlined in Regulation Section
1.704-2(i)(4))), each Partner shall be specially allocated items of
Partnership income and gain for such year (and, if necessary, subsequent
years) in an amount equal to the Partner's share of the net decrease in the
Minimum Gain Attributable to Partner Nonrecourse Debt. The items to be so
allocated shall be determined in accordance with Regulation Section
1.704-2(i)(4) and (j)(2). This paragraph (b) is intended to comply with the
minimum gain chargeback requirement with respect to Partner Nonrecourse
Debt contained in said section of the Regulations and shall be interpreted
consistently therewith. Allocations pursuant to this paragraph (b) shall be
made in proportion to the respective amounts required to be allocated to
each Partner pursuant hereto.
(c) QUALIFIED INCOME OFFSET. In the event a Limited Partner
unexpectedly receives any adjustments, allocations or distributions
described in Regulation Section 1.704-1(b)(2)(ii) (d)(4), (5), or (6), and
such Limited Partner has an Adjusted Capital Account Deficit, items of
Partnership income and gain shall be specially allocated to such Partner in
an amount and manner sufficient to eliminate the Adjusted Capital Account
Deficit as quickly as possible. This paragraph (c) is intended to
constitute a "qualified income offset" under Regulation Section
1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.
(d) NONRECOURSE DEDUCTIONS. Nonrecourse Deductions for any fiscal year
or other applicable period shall be allocated to the Partners in accordance
with their respective Percentage Interests. For purposes of Regulation
Section 1.752-3(a)(3), "excess nonrecourse liabilities" shall be allocated
among the Partners in proportion to their respective Percentage Interests.
(e) PARTNER NONRECOURSE DEDUCTIONS. Partner Nonrecourse Deductions for
any fiscal year or other applicable period shall be specially allocated to
the Partner that bears the economic risk of loss for the debt (i.e., the
Partner Nonrecourse Debt) in respect of which such Partner Nonrecourse
Deductions are attributable (as determined under Regulation Section
1.704-2(b) (4) and (i) (1)).
(f) ADDITIONAL ALLOCATIONS. Notwithstanding the foregoing, if, upon
final dissolution and termination of the
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Partnership and after taking into account all allocations of Net Income and
Net Loss (and other Tax Items) under this Article V, the distributions to
be made in accordance with the positive Capital Account balances would
result in a distribution that would be different from a distribution under
Section 6.3 hereof, then gross items of income and gain (and other Tax
Items) for the taxable year of the final dissolution and termination (and,
to the extent permitted under section 761(c) of the Code, gross items of
income and gain (and other Tax Items) for the immediately preceding taxable
year) shall be allocated to the Partners to increase or decrease their
Capital Account balances, as the case may be, so that the final
distribution will occur in the same manner as a distribution under Section
6.3 hereof.
Section 5.3. TAX ALLOCATIONS.
(a) GENERALLY. Subject to paragraphs (b) and (c) hereof, items of
income, gain, loss, deduction and credit to be allocated for income tax
purposes (collectively, "TAX ITEMS") shall be allocated among the Partners
on the same basis as their respective book items.
(b) SECTIONS 1245/1250 RECAPTURE. If any portion of gain from the sale
of property is treated as gain which is ordinary income by virtue of the
application of Code Sections 1245 or 1250 ("AFFECTED GAIN"), except to the
extent that the tax treatment of such sale is governed by section 704(c) of
the Code as provided under Section 5.3(c) hereof, then (i) such Affected
Gain, to the extent attributable to depreciation or amortization allowed or
allowable for any taxable period subsequent to the date hereof, shall be
allocated among the Partners in the same proportion that the depreciation
and amortization deductions giving rise to the Affected Gain were allocated
and (ii) other Tax Items of gain of the same character that would have been
recognized, but for the application of Code Sections 1245 and/or 1250,
shall be allocated away from those Partners who are allocated Affected Gain
pursuant to clause (i) so that, to the extent possible, the other Partners
are allocated the same amount, and type, of capital gain that would have
been allocated to them had Code Sections 1245 and/or 1250 not applied. For
purposes hereof, in order to determine the proportionate allocations of
depreciation and amortization deductions for each fiscal year or other
applicable period, such deductions shall be deemed allocated on the same
basis as Net Income or Net Loss for such respective period.
(c) ALLOCATIONS RESPECTING SECTION 704(C).
(i) Property contributed to the Partnership shall be subject to
Section 704(c) of the Code and Regulation Section 1.704-3 so that
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notwithstanding Section 5.2 hereof, taxable gain and loss from
disposition of such property contributed to the Partnership that is
subject to section 704(c) of the Code shall be allocated on a property
by property basis in accordance with the Regulations promulgated
thereunder. Notwithstanding the foregoing, tax depreciation and
amortization with respect to Partnership property contributed by a
Partner (x) pursuant to the Contribution Agreement between the
Partnership and the Initial Limited Partner, dated as of June 12,
1995, (y) pursuant to the 1996 Contribution Agreement among Trump,
TCI, THCR/LP and the Partnership, dated as of April 17, 1996, and (z)
pursuant to the Castle Acquisition Agreement and the documents of
transfer executed in connection therewith, dated as of the date
hereof, shall be allocated on an aggregate basis for purposes of
complying with the requirements of Section 704(c) of the Code, taking
into account, for any particular taxable year for which such
allocation is made, the aggregate amount of depreciation and
amortization allowable with respect to the aggregate basis of such
Partnership properties determined as of the respective date of
contribution (and not taking into account (i) any increase in the
basis of such properties resulting from improvements thereon made by
the Partnership subsequent to the respective date of contribution or
(ii) any additional basis resulting from any new property purchased by
the Partnership in a taxable transaction subsequent to the respective
date of contribution); PROVIDED THAT, the General Partner shall not
specially allocate any Tax Items other than items of depreciation and
amortization referred to in this Section 5.3 (c) (i) to cure for the
effect of the ceiling rule set forth in Regulation Section 1.704-3(b),
except as specifically provided in subparagraph (c) (ii) hereof. The
Partnership shall allocate items of income, gain, loss and deduction
allocated to it by a partnership to the Partner or Partners
contributing the interest or interests in such partnership, so that,
to the greatest extent possible and consistent with the foregoing,
such contributing Partner or Partners are allocated the same amount
and character of items of income, gain, loss and deduction with
respect to such partnership that they would have been allocated had
they contributed undivided interests in the assets owned by such
partnership to the Partnership in lieu of contributing the interest or
interests in the partnership to the Partnership.
(ii) Notwithstanding subparagraph (c)(i) hereof, the Partnership
shall make reasonable curative allocations in accordance with
Regulations Section 1.704-3(c): (A) first, to THCR, THCR/LP and TCI of
Tax Items consisting of depreciation, amortization or other
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cost-recovery deductions that would have been otherwise allocable to
Trump pursuant to subparagraph (c)(i) hereof and the provisions of
Regulations Section 1.704-3 without any curative or remedial
allocations, and then (B) second, to Trump of Tax Items of gross
income as provided below. These reasonable curative allocations shall
be made solely for the purpose of providing THCR, THCR/LP and TCI with
the tax equivalent of the depreciation and amortization deductions
that would have been allocated annually to THCR, THCR/LP and TCI
pursuant to subparagraph (c)(i) hereof had the basis of the interest
held by Trump in Castle Associates as of the date hereof been equal to
$100,294,369, as such amount would have been adjusted to reflect
deductions for the portion of 1996 ending immediately prior to the
date hereof. The Tax Items that shall be allocated pursuant to this
subparagraph are limited to, first, to the extent available, tax
depreciation, amortization and other cost-recovery deductions, and,
second, to the extent necessary to satisfy the purpose described in
the preceding sentence, items of gross income (y) the allocation of
which is expected to have substantially the same effect to THCR,
THCR/LP and TCI as would an allocation to THCR, THCR/LP and TCI of
depreciation and amortization deductions with respect to the property
contributed by Trump pursuant to the Castle Acquisition Agreement and
the documents of transfer executed in connection therewith ("Trump's
Castle Property"), or (z) from the disposition of Trump's Castle
Property.
(iii) The tax allocations made pursuant to this paragraph (c)
shall be reflected only in the tax capital accounts of the Partners
and shall have no effect on their Capital Accounts.
Section 5.4. BOOKS OF ACCOUNT. At all times during the continuance of the
Partnership, the General Partner shall maintain or cause to be maintained full,
true, complete and correct books of account in accordance with GAAP, using the
calendar year as the fiscal and taxable year of the Partnership. In addition,
the Partnership shall keep all records required to be kept pursuant to the Act.
Section 5.5. TAX MATTERS PARTNER. The General Partner is hereby designated
as the Tax Matters Partner within the meaning of Section 6231(a)(7) of the Code
for the Partnership; PROVIDED, HOWEVER, that (i) in exercising its authority as
Tax Matters Partner, the General Partner shall be limited by the provisions of
this Agreement affecting tax aspects of the Partnership; (ii) the General
Partner shall consult in good faith with the Limited Partner Representative
regarding the filing of a Code Section 6227(b) administrative adjustment request
with respect to the Partnership or a Contributed Property before
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filing such request, it being understood, however, that the provisions hereof
shall not be construed to limit the ability of any Partner, including the
General Partner, to file an administrative adjustment request on its own behalf
pursuant to Section 6227(a) of the Code; (iii) the General Partner shall consult
in good faith with the Limited Partner Representative regarding the filing of a
petition for judicial review of an administrative adjustment request under
Section 6228 of the Code, or a petition for judicial review of a final
partnership administrative judgment under Section 6226 of the Code relating to
the Partnership before filing such petition; (iv) the General Partner shall give
prompt notice to the Limited Partner Representative and any notice partners
under Section 6231 of the Code of the receipt of any written notice that the
Internal Revenue Service or any state or local taxing authority intends to
examine or audit Partnership income tax returns for any year, receipt of written
notice of the beginning of an administrative proceeding at the Partnership level
relating to the Partnership under Section 6223 of the Code, receipt of written
notice of the final Partnership administrative adjustment relating to the
Partnership pursuant to Section 6223 of the Code, and receipt of any request
from the Internal Revenue Service for waiver of any applicable statute of
limitations with respect to the filing of any tax return by the Partnership and
(v) the General Partner shall promptly notify the Limited Partner Representative
if the General Partner does not intend to file for judicial review with respect
to the Partnership.
Section 5.6. TAX ELECTIONS AND RETURNS. All elections required or
permitted to be made by the Partnership under any applicable tax law shall be
made by the General Partner in its sole and absolute discretion, except that the
General Partner shall, if requested by a Limited Partner or a transferee, file
an election on behalf of the Partnership pursuant to Section 754 of the Code to
adjust the basis of the Partnership property in the case of a transfer of a
Partnership Interest or distribution from the Partnership, including transfers
made in connection with the exercise of the Rights, made in accordance with the
provisions of this Agreement. The General Partner shall cause the Accountants to
prepare and submit to the Limited Partner Representative on or before March 31st
of each year for review drafts of all federal and state income tax returns of
the Partnership. If the Limited Partner Representative determines that any
modifications to the tax returns of the Partnership should be considered, the
Limited Partner Representative shall, within fifteen (15) days following receipt
of such tax returns from the Accountants or the General Partner, indicate to the
Accountants or to the General Partner the suggested revisions to the tax
returns, which returns shall be resubmitted to the Limited Partner
Representative for its review and approval. The Limited Partner Representative
shall complete its review of the resubmitted returns within ten (10) days after
receipt thereof from the Accountants or the General Partner. The General Partner
shall consult in good faith with the Limited Partner Representative regarding
any proposed
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modifications to the tax returns of the Partnership, PROVIDED THAT, (i) a
majority of the Special Committee shall make the final decision, in light of the
best interest of all Partners, of whether to accept or reject any such proposed
modifications, which decision shall be binding upon the Partnership and all of
the Partners and (ii) no Partner shall, unless otherwise required by applicable
law, take any position for income tax purposes or otherwise that is inconsistent
with such final decision of the majority of the Special Committee. A statement
of the allocation of Net Income or Net Loss of the Partnership shown on the
annual income tax returns prepared by the Accountants shall be transmitted and
delivered to the Limited Partner Representative within ten (10) days of the
receipt thereof by the Partnership. The General Partner shall be responsible for
preparing and filing all federal and state tax returns for the Partnership and
furnishing copies thereof to the Partners, together with required Partnership
schedules showing allocations of tax items, all within the period of time
prescribed by law. The General Partner shall use reasonable efforts to make
available to the Limited Partners final Forms K-1 not later than March 31 of
each year. Notwithstanding the foregoing, (x) Trump shall have the right to
control the resolution of tax matters affecting or relating to Taj Associates in
respect of periods ending on or prior to April 17, 1996, including requiring the
Partnership, Trump AC and Taj Associates to adjust the tax basis of assets held
by Taj Associates in connection with the resolution of such tax matters to the
extent such basis adjustments shall not reduce THCR's share of federal income
tax depreciation and cost recovery deductions in respect of assets held by Taj
Associates as of the date hereof and contributions of the interests in Taj
Associates to Trump AC and (y) Trump shall have the right to control the
resolution of tax matters affecting or relating to Castle Associates in respect
of periods ending on or prior to the date hereof, including requiring the
Partnership, TCHI and Castle Associates to adjust the tax basis of assets held
by Castle Associates in connection with the resolution of such tax matters to
the extent such basis adjustments shall not reduce THCR's share of federal
income tax depreciation and cost recovery deductions in respect of assets held
by Castle Associates as of the date hereof and contributions of the interests in
Castle Associates to the Partnership.
Section 5.7. TAX CERTIFICATIONS.
(a) The Partnership shall deliver to each partner in the manner
provided in Section 16.1, from time to time as necessary to implement
timely the provisions of this Agreement, certificates executed by its chief
financial officers and the Accountants indicating the respective
calculations with respect to, and the amounts of, a Partner's share of Tax
Distributions and the amount of any repayments to the Partnership called
for thereunder, together with supporting schedules in reasonable detail all
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as of each pertinent date and delivered at least 15 business days prior to
the date payment is due.
(b) The certificates delivered pursuant to paragraph (a) hereof shall
be deemed approved by all parties and the Partnership shall act upon such
certificates as provided in this Agreement unless within five business days
of delivery of such certificate a Partner objects to the contents of any
certificate by written notice in detail sufficient to state the basis for
the objection. The Partners shall negotiate in good faith to resolve such
objection.
ARTICLE VI.
DISTRIBUTIONS
Section 6.1. GENERAL. Distributions of cash or property may be made in
accordance herewith at such times as the General Partner deems appropriate in
the order provided in this Article VI, subject to the limitations, if any, set
forth in the agreements governing the Partnership's Indebtedness.
Section 6.2. DISTRIBUTIONS FOR TAXES.
(a) The Partnership shall distribute to each Partner in one or more
payments, including payments described in paragraph (b) from time to time
during each year, but in no event later than March 1 of the year
immediately following such year, an aggregate cash sum equal to the product
of (i) Tax Amounts in respect of the taxable year, or portion thereof, for
which such distribution is being made and (ii) the Partner's Percentage
Interest. In addition, the Partnership shall make additional pro rata
distributions as are necessary to reflect adjustments, as determined in
good faith by the board of directors of the General Partner, to any item
affecting Tax Amounts, as reflected on the Partnership's tax return, as it
may be amended from time to time, or as a result of a concluded tax audit.
(b) In addition to the certificates required by Section 5.7, the
Partnership shall furnish the Partners with such information as they shall
reasonably request from time to time respecting estimates of the
Partnership's taxable income or loss (and items thereof) for any fiscal
year or portion thereof. If, in any year, any Partner shall be required to
make federal, state or local estimated income tax payments under applicable
law and regulations, then, at least thirty (30) days prior to the date (the
"Estimated Payment Date") upon which any such payments are due, the
Partnership shall deliver to each Partner the certificates required by
Section 5.7, indicating the amount (the
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"Estimated Payment") of the tax in respect of the respective Tax Amounts
due on the Estimated Payment Date, and not later than fifteen (15) days
prior to such Estimated Payment Date, the Partnership shall pay to such
Partner an amount equal to such Estimated Payment. The amount of each
Estimated Payment received by such Partner shall be treated as a
non-interest bearing advance against the amounts distributable in respect
of such Partner's pro rata share of Tax Amounts to such Partner for such
year. If the aggregate amount of the Estimated Payments received by a
Partner for any year shall exceed the distribution to which such Partner
actually is entitled under paragraph (a) above, such Partner shall
forthwith repay such excess to the Partnership on or before the date set
forth in paragraph (a) above, unless such excess shall have been paid to
taxing authorities in which event such excess shall be applied to reduce
the amount otherwise distributable pursuant to this Section 6.2 in respect
of the Partnership's next succeeding fiscal year or years. Each Partner
shall seek, to the extent entitled thereto, and contribute to the
Partnership any refund of taxes paid by such Partner out of amounts
distributed pursuant to this Section 6.2 promptly after receipt of such
refund.
Section 6.3. OTHER DISTRIBUTIONS. After payments and distributions, if any,
of the amounts set forth in Section 6.2 above, the Partnership may distribute,
in the discretion of a majority of the board of directors of the General
Partner, cash or other property, valued at its Fair Market Value, to the
Partners. Any such distributions shall be made pro rata in accordance with their
Percentage Interests.
Section 6.4. WITHHOLDING PAYMENTS REQUIRED BY LAW.
(a) Unless treated as a Tax Payment Loan (as hereinafter defined), any
amount paid by the Partnership for or with respect to any Partner on
account of any withholding tax or other tax payable with respect to the
income, profits or distributions of the Partnership pursuant to the Code,
the Regulations, or any state or local statute, regulation or ordinance
requiring such payment (a "WITHHOLDING TAX ACT") shall be treated as a
distribution to such Partner for all purposes of this Agreement, consistent
with the character or source of the income, profits or cash which gave rise
to the payment or withholding obligation. To the extent that the amount
required to be remitted by the Partnership under the Withholding Tax Act
exceeds the amount then otherwise distributable to such Partner, unless and
to the extent that funds shall have been provided by such Partner pursuant
to the last sentence of this Section 6.4(a), the excess shall constitute a
loan from the Partnership to such Partner (a "TAX PAYMENT LOAN") which
shall be payable upon demand and shall bear interest, from the date that
the Partnership makes the payment to the
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relevant taxing authority, at the rate announced from time to time by
Citibank, N.A. (or any successor thereto) as its "prime rate", compounded
monthly (but in no event higher than the highest interest rate permitted by
applicable law). So long as any Tax Payment Loan to any Partner or the
interest thereon remains unpaid, the Partnership shall make future
distributions due to such Partner under this Agreement by applying the
amount of any such distributions first to the payment of any unpaid
interest on such Tax Payment Loan and then to the repayment of the
principal thereof, and no such future distributions shall be paid to such
Partner until all of such principal and interest has been paid in full. If
the amount required to be remitted by the Partnership under the Withholding
Tax Act exceeds the amount then otherwise distributable to a Partner, the
Partnership shall notify such Partner at least five (5) Business Days in
advance of the date upon which the Partnership would be required to make a
Tax Payment Loan under this Section 6.4(a) (the "TAX PAYMENT LOAN DATE")
and provide such Partner the opportunity to pay to the Partnership, on or
before the Tax Payment Loan Date, all or a portion of such deficit.
(b) The General Partner shall have the authority to take all actions
necessary to enable the Partnership to comply with the provisions of any
Withholding Tax Act applicable to the Partnership and to carry out the
provisions of this Section 6.4. Nothing in this Section 6.4 shall create
any obligation on the General Partner to advance funds to the Partnership
or to borrow funds from third parties in order to make any payments on
account of any liability of the Partnership under a Withholding Tax Act.
(c) In the event that a Tax Payment Loan is not paid by a Limited
Partner within thirty (30) days after written demand therefor is made by
the General Partner, the General Partner may cause all distributions that
would otherwise be made to such Limited Partner to be retained by the
Partnership, up to the amount necessary to repay such Tax Payment Loan,
including all accrued and unpaid interest thereon, and such retained
distributions shall be applied against, FIRST, the accrued interest on and,
SECOND, the principal of, such Tax Payment Loan.
Section 6.5. NON-RECOURSE. Notwithstanding any other provisions of this
Agreement, the obligations to make distributions contemplated hereby shall be
limited to the assets of the Partnership and shall be non-recourse with respect
to the Partners and any of their assets.
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ARTICLE VII.
RIGHTS, DUTIES AND RESTRICTIONS OF THE GENERAL PARTNER
Section 7.1. POWERS AND DUTIES OF GENERAL PARTNER.
(a) The General Partner shall be responsible for the management of the
Partnership's business and affairs. Except as otherwise expressly provided
in this Agreement, and subject to the limitations contained in Section 7.2
hereof with respect to Major Decisions, the General Partner shall have, and
is hereby granted, full and complete power, authority and discretion to
take such action for and on behalf of the Partnership and in its name as
the General Partner shall, in its sole and absolute discretion, deem
necessary or appropriate to carry out the Partnership's business and the
purposes for which the Partnership was organized. Except as otherwise
expressly provided herein, and subject to Section 7.2 hereof, the General
Partner shall, on behalf of, and at the expense of, the Partnership, have
the right, power and authority:
(i) to manage, control, invest, reinvest, acquire by purchase,
lease or otherwise, sell, contract to purchase or sell, grant, obtain,
or exercise options to purchase, options to sell or conversion rights,
assign, transfer, convey, deliver, endorse, exchange, pledge,
mortgage, abandon, improve, repair, maintain, insure, lease for any
term and otherwise deal with any and all property of whatsoever kind
and nature, and wheresoever situated, in furtherance of the business
or purposes of the Partnership;
(ii) to acquire, directly or indirectly, interests in gaming
ventures of any kind and of any type, and any and all kinds of
interests therein (including, without limitation, Entities investing
therein), and to determine the manner in which title thereto is to be
held; to manage (directly or through management agreements), insure
against loss, protect and subdivide any of such gaming ventures,
interests therein or parts thereof; and to participate in the
ownership, management and operation of any gaming venture;
(iii) to employ, engage, indemnify or contract with or dismiss
from employment or engagement Persons to the extent deemed necessary
or appropriate by the General Partner for the operation and management
of the Partnership's business, including but not limited to
contractors, subcontractors, engineers, architects, surveyors,
mechanics, consultants, accountants, attorneys, insurance brokers and
others;
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(iv) to enter into contracts on behalf of the Partnership, and to
cause all General Partner Expenses to be paid;
(v) to borrow or loan money, obtain or make loans and advances
from and to any Person for Partnership purposes and to apply for and
secure from or accept and grant to any Person credit or
accommodations; to contract liabilities and obligations (including
interest rate swaps, caps and hedges) of every kind and nature with or
without security; and to repay, collect, discharge, settle, adjust,
compromise or liquidate any such loan, advance, obligation or
liability;
(vi) to grant security interests, mortgage, assign, deposit,
deliver, enter into sale and leaseback arrangements or otherwise give
as security or as additional or substitute security or for sale or
other disposition any and all Partnership property, tangible or
intangible, including, but not limited to, personal property and real
estate and interests in land trusts, and to make substitutions
thereof, and to receive any proceeds thereof upon the release or
surrender thereof; to sign, execute and deliver any and all
assignments, deeds, bills of sale and contracts and instruments in
writing; to authorize, give, make, procure, accept and receive moneys,
payments, property notices, demands, protests and authorize and
execute waivers of every kind and nature; to enter into, make,
execute, deliver and receive agreements, undertakings and instruments
of every kind and nature; and generally to do any and all other acts
and things incidental to any of the foregoing or with reference to any
dealings or transactions which the General Partner may deem necessary,
proper or advisable to effect or accomplish any of the foregoing or to
carry out the business and purposes of the Partnership;
(vii) to acquire and enter into any contract of insurance
(including, without limitation, general partner liability and
partnership reimbursement insurance policies) which the General
Partner may deem necessary or appropriate;
(viii) to conduct any and all banking transactions on behalf of
the Partnership; to adjust and settle checking, savings and other
accounts with such institutions as the General Partner shall deem
appropriate; to draw, sign, execute, accept, endorse, guarantee,
deliver, receive and pay any checks, drafts, bills of exchange,
acceptances, notes, obligations, undertakings and other instruments
for or relating to the payment of money in, into or from any account
in
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the Partnership's name; to make deposits into and withdrawals from the
Partnership's bank accounts and to negotiate or discount commercial
paper, acceptances, negotiable instruments, bills of exchange and
dollar drafts;
(ix) to demand, sue for, receive and otherwise take steps to
collect or recover all debts, rents, proceeds, interests, dividends,
goods, chattels, income from property, damages and all other property,
to which the Partnership may be entitled or which are or may become
due the Partnership from any Person; to commence, prosecute or
enforce, or to defend, answer or oppose, contest and abandon all legal
proceedings in which the Partnership is or may hereafter be
interested; and to settle, compromise or submit to arbitration any
accounts, debts, claims, disputes and matters which may arise between
the Partnership and any other Person and to grant an extension of time
for the payment or satisfaction thereof on any terms, with or without
security;
(x) to acquire interests in and contribute money or property to
any limited or general partnerships, joint ventures, Subsidiaries or
other Entities as the General Partner deems desirable and to conduct
the Partnership's business through such Entities;
(xi) to maintain or cause to be maintained the Partnership's
books and records;
(xii) to prepare and deliver, or cause to be prepared and
delivered, all financial and other reports with respect to the
operations of the Partnership, and preparation and filing of all tax
returns and reports;
(xiii) to do all things which are necessary or advisable for the
protection and preservation of the Partnership's business and assets,
and to execute and deliver such further instruments and undertake such
further acts as may be necessary or desirable to carry out the intent
and purposes of this Agreement and as are not inconsistent with the
terms hereof; and
(xiv) in general, to exercise all of the general rights,
privileges and powers permitted to be had and exercised under the Act.
(b) Except as otherwise provided in this Agreement, to the extent the
duties of the General Partner require expenditures of funds to be paid to
third parties, the General Partner shall not have any obligations hereunder
except to the extent that Partnership funds are reasonably
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available to it for the performance of such duties, and nothing herein
contained shall be deemed to require the General Partner, in its capacity
as such, to expend its individual funds for payment to third parties or to
undertake any specific liability or litigation on behalf of the
Partnership.
(c) Notwithstanding the provisions of Section 7.1(a), the Partnership
shall not commingle its funds with those of any Affiliate or other Entity;
funds and other assets of the Partnership shall be separately identified
and segregated; all of the Partnership's assets shall at all times be held
by or on behalf of the Partnership, and, if held on behalf of the
Partnership by another Entity, shall at all times be kept identifiable (in
accordance with customary usages) as assets owned by the Partnership; and
the Partnership shall maintain its own separate bank accounts, payroll and
books of account.
(d) Notwithstanding the provisions of Section 7.1(a), the Partnership
shall pay from its own assets all obligations of any kind incurred by the
Partnership.
Section 7.2. MAJOR DECISIONS. The General Partner shall not, without the
prior Consent of the Limited Partners undertake, on behalf of the Partnership,
any of the following actions at any time that the Limited Partners (not
including the General Partner) own in the aggregate more than ten percent (10%)
of the issued and outstanding Partnership Interests (the "MAJOR DECISIONS"):
(a) make a general assignment for the benefit of creditors or appoint
or acquiesce in the appointment of a custodian, receiver or trustee for all
or any part of the assets of the Partnership;
(b) institute any proceedings for Bankruptcy on behalf of the
Partnership; or
(c) dissolve the Partnership.
Without the consent of all the Limited Partners, the General Partner shall
have no power to do any act in contravention of this Agreement or possess any
Partnership property for other than a Partnership purpose. In addition, the
General Partner shall have no power to do any act in contravention of applicable
law.
Section 7.3. REIMBURSEMENT OF THE GENERAL PARTNER.
(a) Except as provided in this Section 7.3 and elsewhere in this
Agreement (including the provisions of Articles VI and VIII), the General
Partner shall not receive
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payments from, or be compensated for its services as general partner of,
the Partnership.
(b) The General Partner shall be reimbursed on a monthly basis, or
such other basis as the General Partner may determine in its sole and
absolute discretion, for all General Partner Expenses. The Partners agree
that the General Partner Expenses shall be deemed to be incurred on behalf
of the Partnership. The General Partner represents that, except as
permitted by Section 7.4, its sole business is the ownership of direct and
indirect interests in and operation of the Partnership and as such all of
the General Partner Expenses will be incurred for the benefit of the
Partnership.
Section 7.4. OUTSIDE ACTIVITIES OF THE GENERAL PARTNER. Without the Consent
of the Limited Partners, the General Partner shall not directly or indirectly
enter into or conduct any Outside Business Activity.
Section 7.5. CONTRACTS WITH AFFILIATES.
(a) The Partnership may engage in transactions and enter into
contracts with Affiliates which are on terms that are no less favorable to
the Partnership than would be available at the time of such transaction or
transactions in a comparable transaction in arm's-length dealings with an
unaffiliated third party; PROVIDED THAT, the foregoing shall not limit any
of the transactions relating to the Taj Mahal Merger Transaction or the
Castle Acquisition.
(b) Notwithstanding the foregoing:
(i) No compensation shall be paid directly or indirectly to the
Initial Limited Partner by the Partnership or any of its Subsidiaries,
except (A) as set forth in the Executive Agreement, as in effect on
the date of this Agreement, (B) the Services Agreement between Plaza
Associates and the Initial Limited Partner, as in effect on the date
of this Agreement, (C) the Services Agreement between Castle
Associates and TCI-II, as in effect on the date of this Agreement, or
(D) with the approval of the Compensation Committee of the board of
directors of the General Partner; and
(ii) The Partnership and its Subsidiaries shall not enter into
any management, services, consulting or similar agreements with the
Initial Limited Partner or any of his Affiliates, except (A) the
Executive Agreement, as in effect on the date of this Agreement, (B)
the Services Agreement between Plaza Associates and the Initial
Limited Partner, as in effect on the date of this Agreement, (C) the
Services Agreement between Castle Associates and TCI-II, as in
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effect on the date of this Agreement, or (D) employment agreements in
the ordinary course of business, consistent with industry practice,
which are approved by the Compensation Committee of the board of
directors of the General Partner.
Section 7.6. TITLE TO PARTNERSHIP ASSETS. Title to Partnership assets,
whether real, personal or mixed and whether tangible or intangible, shall be
deemed to be owned by the Partnership as an Entity, and no Partner, individually
or collectively, shall have any ownership interest in such Partnership assets or
any portion thereof. Title to any or all of the Partnership assets may be held
in the name of the Partnership, the General Partner or one or more nominees, as
the General Partner may determine, including Affiliates of the General Partner.
The General Partner hereby acknowledges and confirms that any Partnership assets
for which legal title is held in the name of the General Partner or any nominee
or Affiliate of the General Partner shall be held by the General Partner for the
use and benefit of the Partnership in accordance with the provisions of this
Agreement; PROVIDED, HOWEVER, that the General Partner shall use its best
efforts to cause beneficial and record title to such assets to be vested in the
Partnership as soon as reasonably practicable. All Partnership assets shall be
recorded as the property of the Partnership in its books and records,
irrespective of the name in which legal title to such Partnership assets is
held.
Section 7.7. RELIANCE BY THIRD PARTIES. Notwithstanding anything to the
contrary in this Agreement, any Person dealing with the Partnership shall be
entitled to assume that the General Partner has full power and authority to
encumber, sell or otherwise use in any manner any and all assets of the
Partnership and to enter into any contracts on behalf of the Partnership, and
such Person shall be entitled to deal with the General Partner as if it were the
Partnership's sole party in interest, both legally and beneficially. In no event
shall any Person dealing with the General Partner or its representatives be
obligated to ascertain that the terms of this Agreement have been complied with
or to inquire into the necessity or expedience of any act or action of the
General Partner or its representatives. Each and every certificate, document or
other instrument executed on behalf of the Partnership by the General Partner
shall be conclusive evidence in favor of any and every Person relying thereon or
claiming thereunder that (i) at the time of the execution and delivery of such
certificate, document or instrument, this Agreement was in full force and
effect, (ii) the Person executing and delivering such certificate, document or
instrument was duly authorized and empowered to do so for and on behalf of the
Partnership and (iii) such certificate, document or instrument was duly executed
and delivered in accordance with the terms and provisions of this Agreement and
is binding upon the Partnership.
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Section 7.8. LIABILITY OF THE GENERAL PARTNER.
(a) Notwithstanding anything to the contrary set forth in this
Agreement, the General Partner shall not be liable for monetary or other
damages to the Partnership, any of the Partners or any assignee of any
interest of any Partner for losses sustained or liabilities incurred as a
result of errors in judgment or of any act or omission if the General
Partner acted in good faith without fraud, gross negligence, willful
misconduct or a breach of the General Partner's fiduciary duties to the
Limited Partners. The General Partner shall not be obligated to make any
additional payments from its own funds or Capital Contributions for the
purpose of returning any capital of the Limited Partners.
(b) Subject to its obligations and duties as General Partner set forth
in Section 7.1 hereof, the General Partner may exercise any of the powers
granted to it by this Agreement and perform any of the duties imposed upon
it hereunder either directly or by or through its agents. The General
Partner shall not be responsible for any act of any such agent appointed by
it in good faith and without gross negligence including, without
limitation, any willful misconduct or gross negligence on the part of any
such agent.
Section 7.9. OFFICERS OF THE PARTNERSHIP. The Partnership shall have such
officers, if any, as the General Partner from time to time may in its discretion
elect or appoint. The Partnership may also have such agents, if any, as the
General Partner from time to time may in its discretion choose. Each officer
shall have such duties and powers as are commonly incident to his or her office
and such additional duties and powers as the General Partner may from time to
time designate. Each officer and agent shall retain his or her authority at the
pleasure of the General Partner.
Section 7.10. COVENANTS OF THCR REGARDING THE ISSUANCE OF NEW SECURITIES.
THCR hereby covenants and agrees that so long as it is a General Partner:
(a) THCR shall not issue any additional shares of Class B Stock,
except to the Initial Limited Partner and his Permitted Holders.
(b) THCR shall not issue any additional New Securities, other than pro
rata to all holders of Common Stock unless (x) the General Partner shall
cause the Partnership to issue to THCR (or, in the absence of such
issuance, there shall be deemed to have been issued to THCR) Additional
Partnership Interests, as provided in Section 4.2(b)(i) and (y) THCR
contributes the gross proceeds (net of any Issuance Costs not paid by the
Partnership, which
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Issuance Costs shall be deemed to have been contributed to the Partnership
as a Capital Contribution for purposes of Section 4.3), if any, from the
issuance of such New Securities and from the exercise of rights contained
in such New Securities to the Partnership.
(c) In connection with any issuance of New Securities pursuant to
paragraph (b) of this Section 7.10, THCR shall make a Capital Contribution
to the Partnership of the gross proceeds (net of any Issuance Costs not
paid by the Partnership) raised in connection with such issuance (and any
proceeds paid upon conversion or exchange of the New Securities) and the
Partnership shall, as agent for THCR, simultaneously pay the Issuance Costs
to the extent included in General Partner Expenses, and credit such
contribution to the capital account of THCR.
Section 7.11. OTHER MATTERS CONCERNING THE GENERAL PARTNER.
(a) The General Partner may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, or other document reasonably believed by it to
be genuine and to have been signed or presented by the proper party or
parties.
(b) The General Partner may consult with legal counsel, accountants,
appraisers, management consultants, investment bankers and other
consultants and advisers selected by it, and any act taken or omitted to be
taken in reliance upon the advice or opinion of such Persons as to matters
which the General Partner reasonably believes to be within such Person's
professional or expert competence and in accordance with such advice or
opinion shall be prima facie evidence that such actions have been done or
omitted in good faith.
(c) The General Partner shall have the right, in respect of any of its
powers or obligations hereunder, to act through any of its duly authorized
officers and any attorney or attorneys-in-fact duly appointed by the
General Partner. Each such attorney shall, to the extent provided by the
General Partner in the power of attorney, have full power and authority to
do and perform all and every act and duty which is permitted or required to
be done by the General Partner hereunder.
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ARTICLE VIII.
DISSOLUTION, LIQUIDATION AND WINDING-UP
Section 8.1. ACCOUNTING. In the event of the dissolution, liquidation and
winding-up of the Partnership, a proper accounting shall be made of the Capital
Account of each Partner and of the Net Income or Net Loss of the Partnership
from the date of the last previous accounting to the date of dissolution.
Section 8.2. DISTRIBUTION ON DISSOLUTION. In the event of the dissolution
and liquidation of the Partnership for any reason, the assets of the Partnership
shall be liquidated for distribution in the following rank and order:
(a) Payment of creditors of the Partnership, including creditors who
are Partners or former Partners;
(b) Establishment of reserves as provided by the Liquidating Trustee
to provide for contingent liabilities, if any; and
(c) To the Partners in accordance with the positive balances in their
Capital Accounts after giving effect to all contributions, distributions
and allocations for all periods.
Whenever the Liquidating Trustee reasonably determines that any reserves
established pursuant to paragraph (b) above are in excess of the reasonable
requirements of the Partnership, the amount determined to be excess shall be
distributed to the Partners in accordance with the provisions of this Section
8.2.
Section 8.3. TIMING REQUIREMENTS.
(a) In the event that the Partnership is "liquidated" within the
meaning of Section 1.704-1(b)(2)(ii)(g) of the Regulations, any and all
distributions to the Partners pursuant to Section 8.2(c) hereof shall be
made no later than the later to occur of (i) the last day of the taxable
year of the Partnership in which such liquidation occurs or (ii) ninety
(90) days after the date of such liquidation.
(b) Notwithstanding the provisions of Section 8.2 hereof which require
liquidation of the assets of the Partnership, but subject to the order of
priorities set forth therein, if prior to or upon dissolution of the
Partnership the Liquidating Trustee determines that an immediate sale of
part or all of the Partnership's assets would be impractical or would cause
undue loss to the Partners, the Liquidating Trustee may, in its sole and
absolute discretion, defer for a reasonable time the
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liquidation of any assets except those necessary to satisfy liabilities of
the Partnership (including to those Partners which are creditors of the
Partnership) and/or, with the Consent of the Limited Partners, distribute
to the Partners, in lieu of cash, as tenants in common and in accordance
with the provisions of Section 8.2 hereof, undivided interests in such
Partnership assets as the Liquidating Trustee deems not suitable for
liquidation. Any such distributions in kind shall be made only if, in the
good faith judgment of the Liquidating Trustee, such distributions in kind
are in the best interest of the Partners, and shall be subject to such
conditions relating to the disposition and management of such properties as
the Liquidating Trustee deems reasonable and equitable and to any
agreements governing the operation of such properties at such time. The
Liquidating Trustee shall determine the fair market value of any property
distributed in kind using such reasonable method of valuation as it may
adopt.
Section 8.4. DOCUMENTATION OF LIQUIDATION. Upon the completion of the
dissolution and liquidation of the Partnership, the Partnership shall terminate
and the Liquidating Trustee shall have the authority to execute and record any
and all documents or instruments required to effect the dissolution, liquidation
and termination of the Partnership.
Section 8.5. DISSOLUTION. The Partnership shall be dissolved upon the
occurrence of any of the following events:
(a) the dissolution, liquidation, termination, withdrawal, death,
insanity, retirement or Bankruptcy of the last remaining General Partner or
other event causing dissolution under the Act;
(b) the election to dissolve the Partnership made in writing by the
General Partner with the Consent of the Limited Partners;
(c) the sale or other disposition of all or substantially all of the
assets of the Partnership unless the General Partner elects to continue the
Partnership business for the purpose of the receipt and the collection of
indebtedness or the collection of any other consideration to be received in
exchange for the assets of the Partnership (which activities shall be
deemed to be part of the winding up of the affairs of the Partnership); or
(d) the entry of a decree of judicial dissolution of the Partnership
pursuant to the provisions of the Act, which decree is final and not
subject to appeal.
Following an event causing a dissolution of the Partnership, the
Partnership shall be wound-up and terminated
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unless the business of the Partnership is continued by the Partnership in
reconstituted form pursuant to Section 8.6.
Section 8.6. CONTINUATION OF THE PARTNERSHIP. The Partners hereby waive
their right of partition and agree, that except as provided in Section 9.7, they
shall not do anything that would terminate the Partnership prior to the
expiration of its term without the prior Consent of the Limited Partners. Upon
the bankruptcy, dissolution, liquidation, withdrawal, death, retirement or
insanity of any General Partner (a "Disabling Event"), or any other event of
dissolution under the Act, within 90 days thereafter, all of the remaining
Partners (or, to the extent permitted under the Act, such lesser number or
percentage of the Partners, but in no event less than a majority-in-interest of
the remaining Partners) may (a) elect to reconstitute the Partnership and
continue its business, and (b) in the case of an event as a result of which
there is no longer a party serving as general partner of the Partnership, select
a substitute General Partner, which substitute General Partner accepts such
election and agrees to serve as General Partner. Such successor General Partner
shall thereupon succeed to the rights and obligations of the General Partner as
provided in Section 9.1. A General Partner which has suffered a Disabling Event
shall automatically be converted to a Limited Partner having none of the voting
rights or privileges provided hereunder for the election to reconstitute the
Partnership as provided above.
ARTICLE IX.
TRANSFER AND REDEMPTION OF PARTNERSHIP INTERESTS;
CERTAIN CONSENT RIGHTS
Section 9.1. GENERAL PARTNER TRANSFER.
(a) Except as set forth in Section 9.7, during such time as the
Limited Partners (not including the General Partner) own in the aggregate
more than ten percent (10%) of the issued and outstanding Partnership
Interests, the General Partner shall not withdraw from the Partnership and
shall not Transfer all or any portion of its interest in the Partnership
without the Consent of the Limited Partners.
(b) Upon any Transfer of a Partnership Interest by the General Partner
in accordance with the provisions of this Section 9.1 (other than in
connection with the granting of a Lien), the transferee General Partner
shall become vested with the powers and rights of the transferor General
Partner, and shall be liable for all obligations and responsible for all
duties of the General Partner, once such transferee has executed such
instruments as may be necessary to effectuate such admission and to confirm
the agreement of such transferee to be bound by all the terms and
provisions of this Agreement with respect to the Partnership Interest
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so acquired. It shall be a further condition to any Transfer otherwise
permitted hereunder (other than in connection with the granting of a Lien)
that the transferee assumes by express agreement (or pursuant to a
statutory merger or consolidation wherein all obligations and liabilities
of the General Partner are assumed by a successor corporation by operation
of law) all of the obligations of the transferor General Partner under this
Agreement with respect to such transferred Partnership Interest and no such
Transfer (other than pursuant to a statutory merger or consolidation
wherein all obligations and liabilities of the transferor General Partner
are assumed by a successor corporation by operation of law) shall relieve
the transferor General Partner of its obligations under this Agreement
without the Consent of the Limited Partners. In connection with any such
permitted Transfer (other than in connection with the granting of a Lien),
the successor General Partner shall be deemed admitted as such immediately
prior to the effective time of the Transfer from the transferor General
Partner and shall continue the business of the Partnership without
dissolution.
(c) If the General Partner withdraws or retires from the Partnership,
in violation of this Agreement, (i) any remaining general partner may
continue the Partnership business or (ii) within 90 days thereafter, all of
the remaining Partners (or, to the extent permitted under the Act, such
lesser number or percentage of the Partners, but in no event less than a
majority-in-interest of the remaining Partners) may elect to continue the
Partnership business pursuant to Section 8.6.
Section 9.2. TRANSFERS BY LIMITED PARTNERS.
(a) No Limited Partner shall have the right, directly or indirectly,
to Transfer all or any part of its Partnership Interest to any Person
without the prior written consent of the General Partner, including a
majority of the Special Committee, which consent shall not be unreasonably
withheld or delayed; PROVIDED, HOWEVER, that no such consent shall be
required for (i) a Transfer of Partnership Interests pursuant to Article
XII hereof, (ii) a Transfer of Partnership Interests to a Permitted Holder,
(iii) the subjecting of a Limited Partnership Interest to a Permitted
Limited Partnership Interest Lien or (iv) the subsequent foreclosure on
such a Permitted Limited Partnership Interest Lien.
(b) It shall be a further condition to any Transfer (other than the
granting of a Permitted Limited Partnership Interest Lien) otherwise
permitted hereunder (including upon the foreclosure of any Lien) that the
transferee assume by operation of law or express agreement
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all of the obligations of the transferor Limited Partner under this
Agreement (including, without limitation, under Article IX) with respect to
such transferred Partnership Interest and no such Transfer (other than
pursuant to a statutory merger or consolidation wherein all obligations and
liabilities of the transferor Partner are assumed by a successor
corporation by operation of law) shall relieve the transferor Partner of
its obligations under this Agreement without the approval of the General
Partner, in its reasonable discretion (it being understood that, without
limiting the generality of Section 9.5, a transferor Partner shall be
deemed relieved from such obligations, without the necessity of any such
approval, in respect of Partnership Interests transferred to the General
Partner pursuant to Article XII hereof). Upon such Transfer, the transferee
shall, subject to Section 9.2(d), be admitted as a substituted Limited
Partner and shall succeed to all of the rights, including rights with
respect to Article XII hereof, of the transferor Limited Partner under this
Agreement in the place and stead of such transferor Limited Partner (which
succession, in the event of a pledge, may be entered into and become
effective at the time of foreclosure or other realization of such pledge).
Any transferee, whether or not admitted as a substituted Limited Partner,
shall succeed to the obligations of the transferor hereunder (unless such
transfer is a pledge, encumbrance, hypothecation or mortgage or except as
otherwise provided herein). Unless admitted as a Limited Partner pursuant
to, and in accordance with, the terms hereof, no transferee, whether by a
voluntary Transfer, by operation of law or otherwise, shall have rights
hereunder, other than (i) to receive such portion of the distributions made
by the Partnership as are allocable to the Percentage Interest transferred
and (ii) under Article XII hereof.
(c) In addition to any other restrictions on transfer provided herein,
no Partnership Interest of a Limited Partner shall be transferable unless
the General Partner has determined by written notification (a "TRANSFER
DETERMINATION") to the transferring Limited Partner, which Transfer
Determination shall not be unreasonably withheld and shall be deemed given
if not refused within ten Business Days of the notice to the Partnership of
a proposed transfer; PROVIDED THAT, the proposed transferor and transferee
have promptly responded in writing to the reasonable requests, if any, of
the General Partner for additional information sufficient for the General
Partner to determine the matters set forth in this Section 9.2(c), that
either (i) such transfer will not cause (x) any lender to the Partnership
to hold in excess of ten (10) percent of the aggregate Partnership
Interests or any other percentage of the Partnership Interest that would,
pursuant to the Regulations under Section 752 of the Code or any successor
provision, cause a loan by such lender to constitute Partner
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Nonrecourse Debt, (y) a transfer of a Partnership Interest the value of
which would have been less than $20,000 when issued, or (z) a prohibited
transaction (as defined in section 4975(c) of the Code or Section 406 of
ERISA) to occur, or the Partnership to become, with respect to any employee
benefit plan subject to Title 1 of ERISA, a "party in interest" (as defined
in Section 3(14) of ERISA) or a "disqualified person" (as defined in
Section 4975(e)(2) of the Code), or the Partnership to be deemed to hold
"plan assets" (as defined in regulations promulgated by the Department of
Labor) of any employee benefit plan subject to Title I of ERISA, or (ii)
the General Partner has determined to waive one or more of such
requirements as of the date of this Agreement, and may, after the date of
this Agreement, waive one or more of such requirements in its reasonable
discretion after having determined that the transfer will not materially
adversely affect the Partnership, its assets or any Partner, or constitute
a violation of law.
(d) Any transferee of the interest of a Limited Partner pursuant to
this Section 9.2 shall, upon the written request of such transferee and the
transferring Limited Partner and the consent of the General Partner,
including a majority of the Special Committee, which consent shall not be
unreasonably withheld or delayed, be admitted as a Limited Partner under
this Article IX, and the transferring Limited Partner shall, if all of its
Partnership Interests have been Transferred, withdraw from the Partnership.
The Partnership shall not be required in any way to determine the validity
of any written instrument referred to in the immediately preceding
sentence, and shall be authorized to rely upon any such written instrument
signed by the necessary parties.
(e) Any permitted transferee under Section 9.2 who is not admitted as
a substituted Limited Partner in accordance with this Article IX
(including, without limitation, Sections 9.2(b) and 9.2(d)) shall be
considered an assignee for purposes of this Agreement. An assignee shall be
deemed to have had assigned to it, and shall be entitled to receive,
distributions from the Partnership and the share of Net Income, Net Losses,
and any other items of income, gain, loss, deduction and credit of the
Partnership and rights attributable to the Partnership Interests assigned
to such transferee, and shall have the rights of the transferor under
Article XII hereof, but shall not be deemed to be a holder of Partnership
Interests for any other purpose under this Agreement, and shall not be
entitled to vote such Partnership Interests in any matter presented to the
Limited Partners for a vote or consent. In the event any such transferee
desires to make a further assignment of any such Partnership Interests,
such transferee shall be subject to all the provisions of this Article IX
to the same
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extent and in the same manner as any Limited Partner desiring to make an
assignment of Partnership Interests.
(f) The Limited Partners acknowledge that the Partnership Interests
have not been registered under any federal or state securities laws and, as
a result thereof, they may not be sold or otherwise transferred, except in
compliance with such laws. Notwithstanding anything to the contrary
contained in this Agreement, no Partnership Interest may be sold or
otherwise transferred unless such transfer is exempt from registration
under any applicable securities laws or such transfer is registered under
such laws, it being acknowledged that the Partnership has no obligation to
take any action which would cause any such Partnership Interests to be
registered.
(g) Any transferee of ownership of the Partnership Interests
originally held by the Initial Limited Partner shall have the right to
purchase from the transferor of such Partnership Interests a pro rata
portion of the Class B Stock held by such transferor at a purchase price
equal to its par value.
Section 9.3. CERTAIN ADDITIONAL RESTRICTIONS ON TRANSFER. In addition to
any other restrictions on Transfer herein contained, in no event may any
Transfer of a Partnership Interest by any Partner be made (i) to any person or
Entity that lacks the legal right, power or capacity to own a Partnership
Interest; (ii) if such Transfer would cause a termination of the Partnership for
federal income tax purposes, except with the Consent of the Limited Partners,
subject to the provisions of Section 9.7; (iii) if such Transfer would, in the
opinion of counsel to the Partnership, cause the Partnership to cease to be
classified as a partnership for Federal income tax purposes; (iv) if such
Transfer is effectuated through an "established securities market" or a
"secondary market (or the substantial equivalent thereof)" within the meaning of
Section 7704(b) of the Code; (v) if such Transfer would cause the Partnership to
become, with respect to any employee benefit plan subject to Title 1 of ERISA, a
"party-in-interest" (as defined in Section 3(14) of ERISA) or a "disqualified
person" (as defined in Section 4975(e)(2) of the Code); (vi) in violation of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976; or (vii) if such transfer
would, in the opinion of counsel to the Partnership, cause any portion of the
assets of the Partnership to constitute assets of any employee benefit plan
pursuant to Department of Labor Regulations Section 2510.3-101.
Section 9.4. EFFECTIVE DATES OF TRANSFERS.
(a) Transfers pursuant to this Article IX may be made on any day, but
for purposes of this Agreement, the effective date of any such Transfer
shall be (i) the first day of the month in which such Transfer occurred if
such
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Transfer occurred on or prior to the fifteenth calendar day of a month, or
(ii) the first day of the month immediately following the month in which
such transfer occurred, if such Transfer occurred after the fifteenth
calendar day of a month, or such other date determined by the General
Partner pursuant to such convention as may be administratively feasible and
consistent with applicable law.
(b) If any Partnership Interest is Transferred (other than the
granting of a Permitted Limited Partnership Interest Lien) in compliance
with the provisions of this Article IX, on any day other than the first day
of a calendar year, then Net Income, Net Loss, each item thereof and all
other items attributable to such Partnership Interest for such year shall
be allocated to the transferor Partner, or the redeemed or selling
Partners, as the case may be, and, in the case of a Transfer other than a
redemption or the granting of a Permitted Limited Partnership Interest
Lien, to the transferee Partner, by taking into account their varying
interests during such year in accordance with Section 706(d) of the Code,
using the interim closing of the books method. Solely for purposes of
making such allocations, each of such items for the calendar month in which
the effective date of a Transfer (other than the granting of a Lien) occurs
shall be allocated to the transferor or transferee Partner as provided in
Section 9.4(a), and for purposes of Section 9.4(a), the transferee shall be
the owner of the Partnership Interest at the close of business on any day
on which a Transfer takes place.
Section 9.5. TRANSFER.
(a) The term "Transfer," when used in this Article IX with respect to
a Partnership Interest, shall be deemed to refer to a transaction by which
a Partner purports to assign its Partnership Interest or any portion
thereof to another Person, and includes a sale, assignment, gift, pledge,
encumbrance, hypothecation, mortgage, exchange, granting of a Lien or any
other disposition by law or otherwise; PROVIDED, HOWEVER, that the term
"TRANSFER", when used in this Article IX (except when such term is used in
Section 9.4) does not include any acquisition of Partnership Interests from
a Limited Partner by the General Partner or the Partnership pursuant to
Article XII.
(b) The Limited Partner has consented, in Section 4.1, to certain
issuances of Partnership Interests, and the foregoing provisions of this
Article IX, to the extent that they would, but for such Section or this
subsection (b), be applicable to such Transfers, are hereby deemed
satisfied or waived.
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(c) The General Partner is hereby authorized on behalf of each of the
Partners to amend this Agreement (including the schedules hereto) to
reflect the admission of any transferee of a Partnership Interest as a
substituted Limited Partner in accordance with the provisions of this
Article IX.
(d) No Partnership Interest shall be Transferred, in whole or in part,
except in accordance with the terms and conditions set forth in this
Article IX. Any Transfer or purported Transfer of a Partnership Interest
not made in accordance with this Article IX shall be null and void.
Section 9.6. REDEMPTION OF PARTNERSHIP INTEREST. The Partnership shall not
redeem, repurchase, or otherwise acquire Partnership Interests from the
Partners, except (i) for redemptions of Partnership Interests pro rata based on
the Partners' Percentage Interests, (ii) for redemptions of Partnership
Interests as provided in Article XV, and (iii) with the Consent of the Limited
Partners.
Section 9.7. CERTAIN CONSENT RIGHTS. Notwithstanding any other provision
of this Agreement to the contrary, (A) the General Partner shall have the right
to enter into, effect, and/or consummate, and, (B) the Limited Partners, as
such, shall not have the right to approve, consent, or vote with respect to: (x)
any merger, consolidation, combination, sale of all or substantially all of the
assets or stock of the General Partner, the sale of all of the General Partner's
interest in the Partnership, or any similar transaction, which, in the case of
this clause (x), if and only to the extent required by applicable law, has been
approved by the stockholders of the General Partner, or (y) any merger,
consolidation, combination, sale of all or substantially all of the assets of
the Partnership, or any similar transaction, which in the case of this clause
(y) has been approved by the stockholders of the General Partner; PROVIDED,
HOWEVER, that if any transaction is determined to be described in both clauses
(x) and (y) immediately above, the imposition of any requirement that the
stockholders of the General Partnership approve such transaction shall be
governed solely by clause (x) and not by clause (y).
ARTICLE X.
RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS
Section 10.1. NO PARTICIPATION IN MANAGEMENT. No Limited Partner, in its
capacity as such, shall take part in the management of the Partnership's
business, transact any business in the Partnership's name or have the power to
sign documents for or otherwise bind the Partnership. Any rights expressly
granted to the Limited Partners in this Agreement shall not be deemed to be
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rights relating to the management of the Partnership's business.
Section 10.2. BANKRUPTCY OF A LIMITED PARTNER. The Bankruptcy of any
Limited Partner shall not cause a dissolution of the Partnership, but the rights
of such Limited Partner to share in the Net Profits or Net Losses of the
Partnership and to receive distributions of Partnership funds shall, on the
happening of such event, devolve on its successors or assigns, subject to the
terms and conditions of this Agreement, and the Partnership shall continue as a
limited partnership. In no event, however, shall such assignee(s) become a
substituted Limited Partner except in accordance with Article IX hereof.
Section 10.3. NO WITHDRAWAL. No Limited Partner may withdraw from the
Partnership without the prior written consent of the General Partner, other than
as provided in Article IX of this Agreement; PROVIDED THAT, the foregoing
provisions of this Section 10.3 shall not apply to a withdrawal from the
Partnership upon a Transfer pursuant to Article XII hereof, such withdrawal to
be effective immediately without any requirement for consent thereto by the
General Partner.
Section 10.4. CONFLICTS. The Partners recognize that the Limited Partners
and their Affiliates have or may have other business interests, activities and
investments, some of which may be in conflict or competition with the business
of the Partnership, and that such Persons are entitled to carry on such other
business interests, activities and investments. Without limiting the foregoing
in deciding whether to take any actions in such capacity, such Limited Partners
and their Affiliates shall be under no obligation to consider the separate
interests of the Partnership and shall have no fiduciary obligations to the
Partnership and shall not be liable for monetary damages for losses sustained,
liabilities incurred or benefits not derived by the other Partners in connection
with such actions. The Limited Partners and their Affiliates may engage in or
possess an interest in any other business or venture of any kind, independently
or with others, on their own behalf or on behalf of other entities with which
they are affiliated or associated, and such persons may engage in any
activities, whether or not competitive with the Partnership, without any
obligation to offer any interest in such activities to the Partnership or to any
Partner. Neither the Partnership nor any Partner shall have any right, by virtue
of this Agreement, in or to such activities, or the income or profits derived
therefrom, and the pursuit of such activities, even if competitive with the
business of the Partnership, shall not be deemed wrongful or improper.
Notwithstanding the foregoing, (i) the provisions of this Section 10.4 shall not
negate or impair any other agreement between one or more of the Limited Partners
and the General Partner, the Partnership, or any of their respective
Subsidiaries, and (ii) in conducting an Outside Business Activity, a Limited
Partner will to the best of its ability and consistent with its fiduciary duty
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to such Outside Business Activity, conduct such Outside Business Activity in a
commercially reasonable manner so that on an annual overall basis the
Partnership is not discriminated against.
Section 10.5. PROVISION OF INFORMATION.
(a) ANNUAL AND PERIODIC REPORTS.
(i) ANNUAL STATEMENT. The General Partner shall, as soon as
practicable, but in no event later than 105 days after the close of
each fiscal year, cause to be furnished to each Partner Audited
Financial Statements for the Partnership, or of the General Partner if
such statements are prepared solely on a consolidated basis with the
General Partner, for the immediately preceding fiscal year of the
Partnership.
(ii) QUARTERLY REPORTS. The General Partner shall, as soon as
available and, in any event, within 45 days after the end of each of
the first three fiscal quarters of the Partnership's fiscal year,
furnish to each Partner the internally prepared unaudited combined
balance sheet of the Partnership and its combined Subsidiaries as of
the end of such quarter and the combined statements of profit and
loss, partners' capital and cash flow for such quarter and for the
portion of the fiscal year then ending (all in reasonable detail),
accompanied by a certificate of the General Partner or of the chief
financial officer of the Partnership to the effect that, except for
the lack of required footnotes, such balance sheets and statements
have been properly prepared in accordance with GAAP and fairly present
the financial condition of the Partnership and its combined
Subsidiaries as of the date thereof and the results of their
operations for the period covered thereby, subject only to normal
year-end audit adjustments. In lieu of the foregoing, the General
Partner may furnish to each Partner a copy of the Partnership's
quarterly report on Form 10-Q, if the Partnership is then obligated to
file such report with the SEC pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended.
(b) In addition to other rights provided by this Agreement or by the
Act, each Limited Partner shall have the right, for a purpose reasonably
related to such Limited Partner's interest as a limited partner in the
Partnership (the interests of a lender to such Limited Partner having a
Permitted Limited Partnership Interest Lien on its Partnership Interests
being so related), upon written demand with a statement of the purpose of
such demand:
(i) to obtain a copy of the most recent annual and quarterly
reports and current reports on
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Form 8-K filed with the SEC by the General Partner pursuant to the
Securities Exchange Act of 1934, as amended;
(ii) to obtain a copy of the Partnership's federal, state and
local income tax returns for each fiscal year of the Partnership;
(iii) to obtain a current list of the name and last known
business, residence or mailing address of each Partner;
(iv) to obtain a copy of this Agreement and the Certificate and
all amendments thereto, together with executed copies of all powers of
attorney pursuant to which this Agreement, the Certificate and all
amendments thereto have been executed; and
(v) such other information regarding the business, affairs and
condition, financial or otherwise, of the Partnership and its
Subsidiaries as such Partner may reasonably request.
(c) Notwithstanding any other provision of this Section 10.5, the
General Partner may keep confidential from the Limited Partners, for such
period of time as the General Partner determines in its sole and absolute
discretion to be reasonable, any information that the Partnership is
required by law or by agreements with an unaffiliated third party to keep
confidential.
Section 10.6. LIMITED PARTNER REPRESENTATIVE. The Initial Limited Partner
is hereby appointed as the Limited Partner Representative. A
Majority-in-Interest of the Limited Partners shall have the right, at any time,
within their sole discretion, to replace the Limited Partner Representative, or
to appoint a temporary substitute to act for a Limited Partner Representative
unable to act. Any appointment of a Limited Partner Representative made
hereunder shall remain effective until rescinded in a writing delivered to the
General Partner via certified mail, registered overnight express mail or
telecopy, and the General Partner shall have the right and authority to rely
(and shall be fully protected in so doing) on the actions taken and directions
given by such Limited Partner Representative, without any further evidence of
their authority or further action by the Limited Partners. The General Partner
shall send copies of all notices received by it pursuant to Section 5.6 to each
Limited Partner requesting the same.
Section 10.7. POWER OF ATTORNEY.
(a) Each Limited Partner constitutes and appoints the General Partner,
any Liquidating Trustee and authorized officers and attorneys-in-fact of
each, and each of those
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acting singly, in each case with full power of substitution, as its true
and lawful agent and attorney-in-fact, with full power and authority in its
name, place and stead to: execute, swear to, acknowledge, deliver, file and
record in the appropriate public offices (i) all certificates, documents
and other instruments (including, without limitation, this Agreement and
the Certificate and all amendments or restatements thereof) that the
General Partner or the Liquidating Trustee deems appropriate or necessary
to form, qualify or continue the existence or qualification of the
Partnership as a limited partnership (or a partnership in which the limited
partners have limited liability) in the State of Delaware and in all other
jurisdictions in which the Partnership may conduct business or own
property; (ii) all instruments that the General Partner deems appropriate
or necessary to reflect any amendment, change, modification or restatement
of this Agreement in accordance with its terms; (iii) all conveyances and
other instruments or documents that the General Partner deems appropriate
or necessary to reflect the dissolution and liquidation of the Partnership
pursuant to the terms of this Agreement, including, without limitation, a
certificate of cancellation; and (iv) all instruments relating to the
admission, withdrawal, removal or substitution of any Partner pursuant to
the provisions of this Agreement or the Capital Contribution of any
Partner.
(b) The foregoing power of attorney is irrevocable and a power coupled
with an interest, in recognition of the fact that each of the Partners will
be relying upon the power of the General Partner to act as contemplated by
this Agreement in any filing or other action by it on behalf of the
Partnership, and it shall survive the death or incompetency of a Limited
Partner to the effect and extent permitted by law, subsequent incapacity of
any Limited Partner and the transfer of all or any portion of such Limited
Partner's Partnership Interests and shall extend to such Limited Partner's
heirs, successors, assigns and personal representatives.
(c) Nothing contained in this Section 10.7 shall be construed as
authorizing the General Partner to amend this Agreement except in
accordance with Article XIII hereof.
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ARTICLE XI.
INDEMNIFICATION; EXCULPATION
Section 11.1. INDEMNIFICATION.
(a) To the fullest extent permitted by law, the Partnership shall and
does hereby indemnify an Indemnitee from and against any and all losses,
claims, damages, liabilities, joint or several, expenses (including
reasonable legal fees and expenses), judgments, fines, settlements, and
other amounts (collectively "Damages") arising from any and all claims,
demands, actions, suits or proceedings, civil, criminal, administrative or
investigative, that relate to the operations of the Partnership as set
forth in this Agreement in which any Indemnitee may be involved, or is
threatened to be involved, as a party or otherwise, unless it is
established that: (i) the act or omission of the Indemnitee was material to
the matter giving rise to the proceeding and was committed with fraud,
gross negligence, willful misconduct or in breach of the General Partner's
fiduciary duties to the Limited Partners; (ii) the Indemnitee actually
received an improper personal benefit in money, property or services; or
(iii) in the case of any criminal proceeding, the Indemnitee had reasonable
cause to believe that the act or omission was unlawful. The termination of
any proceeding by judgment, order or settlement shall not create a
presumption that the Indemnitee did not meet the requisite standard of
conduct set forth in this Section 11.1(a). Any indemnification pursuant to
this Section 11.1 shall be made only out of the assets of the Partnership
and no Partner shall have any personal liability therefor.
(b) Reasonable expenses incurred by an Indemnitee may be paid or
reimbursed by the Partnership in advance of the final disposition of the
proceeding upon receipt by the Partnership of (i) a written affirmation by
the Indemnitee of the Indemnitee's good faith belief that the standard of
conduct necessary for indemnification by the Partnership, as authorized in
this Section 11.1, has been met, and (ii) a written undertaking by or on
behalf of the Indemnitee to repay the amount paid or reimbursed if it shall
ultimately be determined that such standard of conduct has not been met.
(c) The indemnification provided by this Section 11.1 shall be in
addition to any other rights to which an Indemnitee may be entitled under
any agreement, as a matter of law or otherwise, and shall continue as to an
Indemnitee who has ceased to serve in such capacity.
(d) The Partnership may purchase and maintain insurance, on behalf of
the Indemnitees, against any
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liability that may be asserted against or expenses that may be incurred by
such Person in connection with the Partnership's activities, regardless of
whether the Partnership would have the power to indemnify such Person
against such liability under the provisions of this Agreement.
(e) For purposes of this Section 11.1, the Partnership shall be deemed
to have requested an Indemnitee to serve as fiduciary of an employee
benefit plan whenever the performance by it of its duties to the
Partnership also imposes duties on, or otherwise involves services by, it
to the plan or participants or beneficiaries of the plan; excise taxes
assessed on an Indemnitee with respect to an employee benefit plan pursuant
to applicable law shall constitute fines within the meaning of this Section
11.1; and actions taken or omitted by the Indemnitee with respect to an
employee benefit plan in the performance of its duties for a purpose
reasonably believed by it to be in the interest of the participants and
beneficiaries of the plan shall be deemed to be for a purpose which is not
opposed to the best interests of the Partnership.
(f) An Indemnitee shall not be denied indemnification in whole or in
part under this Section 11.1 solely because the Indemnitee had an interest
in the transaction with respect to which the indemnification applies.
(g) The provisions of this Section 11.1 are for the benefit of the
Indemnitees, their heirs, successors, assigns personal representatives and
administrators, and shall not be deemed to create any rights for the
benefit of any other Persons.
Section 11.2. INDEMNIFICATION PROCEDURES.
(a) If a claim for indemnification is asserted against the Partnership
under Article XI, the Partnership shall have the right, at its own expense,
(i) subject to the Partnership's obligations to pay all amounts under
Section 11.1(a) to participate in the defense of any Action which resulted
in the claim for indemnification or (ii) to assume at any time the defense
of any Action which resulted in the claim for indemnification. Such
assumption of the defense by the Partnership shall be an admission that the
Action is a proper subject of indemnification pursuant to this Article XI.
The Indemnitee at any time may elect to participate in (but not conduct or
control) such defense at its expense, and the Partnership shall not be
responsible for the Indemnitee's costs of participation (including
attorneys, accountants, and in-house counsel fees). In either event, the
parties shall cooperate in the defense of such Action. The Partnership in
the defense of any Action shall not,
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except with the consent of the Indemnitee claiming indemnification under
Article XI, cause to be entered any judgment or enter into any settlement
which provides for the release of the Partnership or any other Partner but
does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnitee of a release equivalent to that
provided to the Partnership or any other Partner.
(b) The Indemnitee claiming indemnification under Article XI may, at
any time upon written notice to the Partnership, elect to conduct or
control its own defense in such Action (as opposed to merely participating
in the defense with counsel for the Partnership), but in such event,
provided that the Partnership has theretofore undertaken the defense of the
Indemnitee pursuant to Section 11.2(a) and subject to Section 11.2(c), such
Indemnitee shall cease to have the indemnification rights under Article XI,
and the Partnership shall no longer be obligated to continue the defense of
the Limited Partner, with respect to such Action.
(c) If the Partnership has assumed the defense of any Action under
clause (ii) of the first sentence of Section 11.2(a), and if at any time
there exists a conflict of interest in defending both the Partnership and
the Indemnitee, as determined in the reasonable judgment of counsel to the
Indemnitee, the Indemnitee shall so notify the Partnership and the
Indemnitee may, upon written notice to the Partnership delivered promptly
thereafter, elect to defend itself in such Action with counsel selected by
the Indemnitee, but reasonably acceptable to the Partnership, at the
expense of the Partnership. Following the assumption of defense by an
Indemnitee under this Section 11.2(c), an Indemnitee may not enter into any
settlement without the prior written consent of the Partnership, which
consent shall not be unreasonably withheld.
Section 11.3. EXCULPATION. No officer, employee or agent shall have any
liability to the Partnership or any Partner for monetary damages for any action
taken, or any failure to take any action, in such capacity, except liability for
(a) any improper financial benefit received by such Person; (b) an intentional
infliction of harm on the Partnership or any Partner; (c) acts or omissions not
in good faith or which involve intentional misconduct; and (d) any knowing
violation of law.
Section 11.4. NO LIABILITY OF DIRECTORS AND OTHERS. Notwithstanding
anything to the contrary contained herein, no recourse shall be had by the
Partnership or any Partner against any director, shareholder, officer, employee,
agent or attorney of the General Partner for any act or omission of the General
Partner or any obligation or liability of the General Partner under this
Agreement, and none of the foregoing shall have any
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personal liability for or with respect to any of the foregoing; PROVIDED THAT,
the foregoing shall not relieve any officer or director of the General Partner
of any liability in his capacity as such.
ARTICLE XII.
RIGHTS UNDER THE EXCHANGE RIGHTS AGREEMENT
THCR, the Initial Limited Partner, TCI and TCI-II have entered into the
Exchange Rights Agreement, substantially in the form of Exhibit A to this
Agreement.
Section 12.1. TRANSFER PURSUANT TO EXCHANGE RIGHTS AGREEMENT.
Notwithstanding anything to the contrary contained in this Agreement, the
Partners hereby consent to the Transfer of Partnership Interests pursuant to the
terms of such Exchange Rights Agreement, without compliance with any of the
other provisions of this Agreement.
Section 12.2. SUBJECT TO THE EXCHANGE RIGHTS AGREEMENT. The Initial Limited
Partner, TCI, TCI-II and all their respective subsequent transferees shall be
entitled to the benefits of, and subject to the burdens of, the Exchange Rights
Agreement, including, but not limited to, the "Conversion Right" of the Company
to require any such transferee (other than the Initial Limited Partner and his
Permitted Holders) to exchange its Partnership Interests for shares of Common
Stock on the terms and subject to the conditions set forth therein.
ARTICLE XIII.
AMENDMENT OF PARTNERSHIP AGREEMENT, MEETINGS
Section 13.1. AMENDMENTS.
(a) This Agreement may not be amended unless such amendment is
approved by the General Partner, with the consent of a majority of the
Special Committee, and by the Consent of the Limited Partners, except as
provided below in this Section 13.1.
(b) Notwithstanding Section 13.1(a), the General Partner, with the
consent of a majority of the Special Committee, shall have the power,
without the Consent of the Limited Partners but after five Business Days
notice to the Limited Partners, to amend this Agreement as may be required
to facilitate or implement any of the following purposes:
(i) to add to the obligations of the General Partner or surrender
any right or power granted
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to the General Partner for the benefit of the Limited Partners;
(ii) to reflect the admission, substitution, termination, or
withdrawal of Partners after the date hereof in accordance with
Article IX or XII of this Agreement; PROVIDED THAT, the General
Partner shall not be required to give the notice referred to in the
first paragraph of this subsection (b) in respect of a transfer of
Partnership Interests pursuant to Article XII hereof;
(iii) to reflect a change that is of an inconsequential nature
and does not adversely affect the Limited Partners, or to cure any
ambiguity, correct or supplement any provision in this Agreement not
inconsistent with law or with other provisions, or make other changes
with respect to matters arising under this Agreement that will not be
inconsistent with law or with the provisions of this Agreement; and
(iv) to satisfy any requirements, conditions, or guidelines
contained in any order, directive, opinion, ruling or regulation of a
federal or state agency or contained in federal or state law.
The General Partner will provide notice to the Limited Partners promptly
after any action under this Section 13.1(b) is taken.
(c) Notwithstanding Sections 13.1(a) and (b) hereof, this Agreement
shall not be amended without the prior written consent of each Partner
adversely affected if such amendment would (i) convert a Limited Partner's
interest in the Partnership into a general partner's interest, (ii) modify
the limited liability of a Limited Partner, (iii) alter rights of the
Partners to receive allocations and distributions pursuant to Articles V
and VI hereof, (iv) alter or modify the Rights set forth in Article XII
except in compliance therewith, (v) amend this Section 13.1(c), (vi) alter
such Partner's rights to transfer its Partnership Interests, or (vii) amend
Section 4.1(c), 7.8, 10.8, Article XI or 13.2(d). Further, no amendment may
alter the restrictions on the General Partner's authority set forth in
Section 7.2 without the Consent specified in that section.
(d) Notwithstanding Section 13.1(a) hereof, no amendment of Section
7.4 shall be effective unless appropriate corresponding modifications are
made to Article XII and the Registration Rights Agreement to preserve the
financial terms of the Limited Partners' rights thereunder.
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(e) Any amendment, modification or repeal of Section 7.8 or Article XI
or any provision thereof shall be prospective only and shall not in any way
affect the rights to indemnification and limitations on the General
Partner's liability to the Partnership and the Limited Partners as in
effect immediately prior to such amendment, modification or repeal with
respect to claims arising from or relating to matters occurring, in whole
or in part, prior to such amendment, modification or repeal, regardless of
when such claims may arise or be asserted.
Section 13.2. MEETINGS OF THE PARTNERS; NOTICES TO PARTNERS.
(a) Meetings of the Partners may be called by the General Partner or
by any Limited Partner to act on any matter specified herein or in the Act
to be voted on or consented to by the Partners. The call shall state the
nature of the business to be transacted. Notice of any such meeting shall
be given to all Partners not less than seven (7) Business Days prior to the
date of such meeting. Partners may vote in person or by proxy at such
meeting. Whenever the vote or Consent of the Limited Partners is permitted
or required under this Agreement, such vote or Consent may be given at a
meeting of Partners or may be given in accordance with the procedure
prescribed in Section 13.2(b) hereof. Except as otherwise expressly
provided in this Agreement, the consent of holders of a majority of the
Partnership Interests shall control.
(b) Any action required or permitted to be taken at a meeting of the
Partners may be taken without a meeting if a written consent setting forth
the action so taken is (i) signed by Partners holding a majority of the
Partnership Interests of the Partners (or such other percentage as is
expressly required by this Agreement) and (ii) in the case of any matter
that would otherwise require the approval of a majority of the Special
Committee, such consent is approved by a majority of the Special Committee.
Such consent may be in one instrument or in several instruments, and shall
have the same force and effect as a vote of a majority of the Partnership
Interests of the Partners (or such other percentage as is expressly
required by this Agreement). Such consent shall be filed with the General
Partner and copies thereof delivered to all Partners. An action so taken
shall be deemed to have been taken at a meeting held on the effective date
so certified.
(c) Each Limited Partner may authorize any Person or Persons to act
for him by proxy on all matters in which a Limited Partner is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. Every proxy must be signed by the Limited
Partner or his attorney-in-fact. No proxy shall be valid
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<PAGE>
after the expiration of 11 months from the date thereof unless otherwise
provided in the proxy. Every proxy shall be revocable at the pleasure of
the Limited Partner executing it. No such proxy and no such revocation
shall be effective unless a copy thereof has been delivered to the General
Partner.
(d) Whenever the Consent of the Limited Partners is required
hereunder, the General Partner shall provide a notice to each Partner who
is a Limited Partner on the date the notice is given setting forth the
matter(s) as to which it proposes to seek such Consent at least five (5)
Business Days in advance of the date upon which such Consent is sought.
ARTICLE XIV.
CERTIFICATE OF INTEREST
Section 14.1. FORM OF CERTIFICATE OF INTEREST. The interest of each Partner
in the Partnership shall be evidenced by a Certificate of Interest (each a
"Certificate of Interest"). A certificate transfer ledger (the "Certificate
Transfer Ledger") recording the issue and transfer of Certificates of Interest
in the Partnership shall be maintained at the principal office of the
Partnership. Each such Certificate of Interest shall be serially numbered and
shall be issued by the General Partner to the lawful holder of an interest in
the Partnership, upon payment of the full amount of the Capital Contributions
then due with respect to the Partnership Interest represented by such
Certificate of Interest. All Certificates of Interest shall be executed in the
name of the Partnership by the General Partner. Each Certificate of Interest
shall state on its face the name of the registered holder thereof, and shall
bear, on both sides thereof, a statement of the restrictions imposed by Section
105 of the Casino Control Act. Effective on the date hereof, the General
Partner, the Initial Limited Partner, THCR/LP and TCI shall tender their
respective Certificates of Interest (which shall be canceled) for new
Certificates of Interest evidencing, as of the date hereof, their respective
interests in the Partnership.
Section 14.2. TRANSFERS OF CERTIFICATES OF INTEREST. Certificates of
Interest in the Partnership may be transferred by the lawful holders thereof
only in connection with the pledge or transfer of all or part of the interest of
such holder in the Partnership, and only in accordance with the provisions of
this Agreement. All such transfers shall be effected by duly executed and
acknowledged instruments of assignment, each of which shall be duly recorded on
the Certificate Transfer Ledger. No effect shall be given to any purported
assignment of a Certificate of Interest, or transfer of the interest in the
Partnership evidenced thereby, unless such assignment and transfer shall be
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<PAGE>
in compliance with the terms and provisions of this Agreement, and any attempted
assignment or transfer in contravention hereof shall be ineffectual.
Section 14.3. LOST, STOLEN, DESTROYED OR MUTILATED CERTIFICATES OF
INTEREST. In the event that a Certificate of Interest shall be lost, stolen,
destroyed or mutilated, the Partnership may cause a replacement Certificate of
Interest to be issued upon such terms and conditions as shall be fixed by the
General Partner, including, without limitation, provision for indemnity and the
posting of a bond or other adequate security as security therefor. No
replacement Certificate of Interest shall be issued to any person unless such
person has surrendered the Certificate of Interest to be replaced, or has
complied with the terms of this Section 14.3.
Section 14.4. INSPECTION OF CERTIFICATE TRANSFER LEDGER. The Certificate
Transfer Ledger containing the names and addresses of all Partners and the
interest of each Partner in the Partnership shall be open to the inspection of
the Partners at the principal office of the Partnership during usual business
hours upon request of any Partner. Such Certificate Transfer Ledger shall, in
addition, be available for inspection by the CCC and the Division of Gaming
Enforcement of the State of New Jersey and each of their respective authorized
agents at all reasonable times without notice.
ARTICLE XV.
REGULATORY REQUIREMENTS
Section 15.1. APPLICABLE REGULATORY AUTHORITY AND CCC REGULATION.
Notwithstanding anything to the contrary in this Agreement:
(a) This Agreement will be deemed to include all provisions required
by the Casino Control Act, the Indiana Riverboat Act, and the Mississippi
Gaming Control Act and to the extent that anything contained in this
Agreement is inconsistent with such acts, the provisions of such acts shall
govern. All provisions of the Casino Control Act, the Indiana Riverboat
Act, and the Mississippi Gaming Control Act to the extent required by law
to be included in this Agreement, are incorporated herein by reference as
if fully restated in this Agreement.
(b) If the continued holding of a Partnership Interest by any Partner
will disqualify the Partnership to continue as the owner and operator of a
casino licensed in the State of New Jersey under the provisions of the
Casino Control Act, such Partner shall enter into such escrow, trust or
similar arrangement as may be required by the CCC under the circumstances.
It is the intent of this Section
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<PAGE>
15.1 to set forth procedures to permit the Partnership to continue, on an
uninterrupted basis, as the owner and operator of a casino licensed under
the provisions of the Casino Control Act.
(c) All transfers (as defined by the Casino Control Act and the
governing laws, statutes rules and regulations of any Applicable Regulatory
Authority) of securities (as defined by the Casino Control Act and the
governing laws, statutes rules and regulations of any Applicable Regulatory
Authority), shares and other interests in the Partnership shall be subject
to the right of prior approval by the Applicable Regulatory Authority; and
(b) the Partnership shall have the absolute right to repurchase in
accordance with Section 15.3, any security, share or other interest in the
Partnership in the event that the Applicable Regulatory Authority
disapproves a transfer in accordance with the provisions of the Casino
Control Act.
(d) Each Partner hereby agrees to cooperate reasonably and promptly
with the others in obtaining any and all licenses, permits or approvals
required by any Applicable Regulatory Authority or deemed expedient by the
Partners.
Section 15.2. ADDITIONAL APPLICABLE REGULATORY AUTHORITY REGULATION. No
Person may become the Beneficial Owner of five percent (5%) or more of any class
or series of Partnership Interests unless such Person agrees in writing to: (i)
provide to the Applicable Regulatory Authorities information regarding such
Person, including without limitation thereto, information regarding other
gaming-related activities of such Person and financial statements, in such form,
and with such updates, as may be required by the Applicable Regulatory
Authorities; (ii) respond to written or oral questions that may be propounded by
the Applicable Regulatory Authorities and (iii) consent to the performance of
any background investigation that may be required by the IGC, including without
limitation thereto, an investigation of any criminal record of such Person.
Section 15.3. DISQUALIFIED HOLDERS. Notwithstanding any other provision of
this Agreement, Partnership Interests held by a Disqualified Holder (or in the
case of a Disqualified Holder of securities of the General Partner, the
corresponding Partnership Interest of the General Partner) shall be subject to
redemption at any time by the Partnership by action of the General Partner,
pursuant to this Section 15.3 as follows:
(a) the redemption price of the Partnership Interest to be redeemed
pursuant to this Section 15.3 shall be equal to the Fair Market Value of
such Partnership Interest or such other redemption price as required by
pertinent state or federal law pursuant to which the redemption is
required;
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<PAGE>
(b) the redemption price of such shares may be paid in cash,
Redemption Securities or any combination thereof; PROVIDED, HOWEVER, in the
case of a redemption mandated by the CCC, the redemption price shall be
paid in cash;
(c) if less than all the Partnership Interest held by Disqualified
Holders are to be redeemed, the Partnership Interest to be redeemed shall
be selected in such manner as shall be determined by the General Partner,
which may include selection first of the most recently purchased portion
thereof, selection by lot, or selection in any other manner determined by
the General Partner;
(d) at least thirty (30) days' written notice of the Redemption Date
shall be given to the record holders of the Partnership Interest selected
to be redeemed (unless waived in writing by any such holder); PROVIDED,
HOWEVER, that the Redemption Date shall be deemed to be the date on which
written notice shall be given to record holders if the cash or Redemption
Securities necessary to effect the redemption shall have been deposited in
trust for the benefit of such record holders and subject to immediate
withdrawal by them upon surrender of the Certificates of Interests for
their Partnership Interests to be redeemed;
(e) from and after the Redemption Date or such earlier date as
mandated by pertinent state or federal law, any and all rights of whatever
nature, which may be held by the Beneficial Owners of Partnership Interests
selected for redemption (including without limitation any rights to vote or
participate in distribution) shall cease and terminate and they shall
thenceforth be entitled only to receive the cash or Redemption Securities
payable upon redemption; and
(f) such other terms and conditions as the General Partner shall
determine.
ARTICLE XVI.
GENERAL PROVISIONS
Section 16.1. NOTICES. All notices, offers or other communications required
or permitted to be given pursuant to this Agreement shall be in writing and may
be personally served or sent by United States mail and shall be deemed to have
been given when delivered in person or three business days after deposit in
United States mail, registered or certified, postage prepaid, and properly
addressed, by or to the appropriate party. For purposes of this Section 16.1,
the addresses of the parties hereto shall be as set forth below their name on
the signature page hereof.
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<PAGE>
The address of any party hereto may be changed by a notice in writing given in
accordance with the provisions hereof.
Section 16.2. CONTROLLING LAW. This Agreement and all questions relating to
its validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the State of Delaware,
notwithstanding any conflict-of-laws doctrines of such state or other
jurisdiction to the contrary.
Section 16.3. NO THIRD PARTY BENEFICIARIES. No creditor or other third
party shall have the right to enforce any right or obligation of any Partner to
make Capital Contributions or to pursue any other right or remedy hereunder or
at law or in equity, it being understood and agreed that the provisions of this
Agreement shall be solely for the benefit of, and may be enforced solely by, the
parties hereto and their respective successors and assigns. None of the rights
or obligations of the Partners herein set forth to make Capital Contributions to
the Partnership shall be deemed an asset of the Partnership for any purpose by
any creditor or other third party, nor may such rights or obligations be sold,
transferred or assigned by the Partnership or pledged or encumbered by the
Partnership to secure any debt or other obligation of the Partnership or of any
of the Partners.
Section 16.4. EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of all of the parties reflected hereon as the
signatories.
Section 16.5. PROVISIONS SEPARABLE. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
Section 16.6. ENTIRE AGREEMENT. This Agreement (together with the Exhibit
and Schedules hereto) contains the entire understanding among the parties hereto
with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements and understandings, inducements or conditions,
express or implied, oral or written, except as herein contained. The express
terms hereof control and supersede any course of performance and/or usage of the
trade inconsistent with any of the terms hereof. This Agreement may not be
modified or amended other than by an agreement in writing.
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<PAGE>
Section 16.7. PARAGRAPH HEADINGS. The paragraph headings in this Agreement
are for convenience only; they form no part of this Agreement and shall not
affect its interpretation.
Section 16.8. GENDER, ETC. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context indicates is appropriate.
Section 16.9. NUMBER OF DAYS. In computing the number of days (other than
Business Days) for purposes of this Agreement, all days shall be counted,
including Saturdays, Sundays and holidays; PROVIDED, HOWEVER, that if the final
day of any time period falls on a date which is not a Business Day, then the
final day shall be deemed to be the next Business Day.
Section 16.10. PARTNERS NOT AGENTS. Nothing contained herein shall be
construed to constitute any Partner the agent of another Partner, except as
specifically provided herein, or in any manner to limit the Limited Partners in
the carrying on of their own respective businesses or activities.
Section 16.11. ASSURANCES. Each of the Partners shall hereafter execute and
deliver such further instruments and do such further acts and things as may be
reasonably required or useful to carry out the intent and purpose of this
Agreement and as are not inconsistent with the terms hereof.
Section 16.12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the parties and their heirs, executors,
administrators, successors, legal representatives and permitted assigns,
including any pledgee upon the foreclosure of any pledge of a Partner's
Partnership Interest in the Partnership.
Section 16.13. WAIVER. No failure by any party to insist upon the strict
performance of any covenant, duty, agreement or condition of this Agreement or
to exercise any right or remedy consequent upon a breach thereof shall
constitute waiver of any such breach or any other covenant, duty, agreement or
condition.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be executed on their behalf as of the date first above
written.
GENERAL PARTNER:
TRUMP HOTELS & CASINO RESORTS, INC.
By: /s/ ROBERT M. PICKUS
-----------------------------------------
Name: Robert M. Pickus
Title: Executive Vice President
and Secretary
Address: 2500 Boardwalk
Atlantic City,
New Jersey 08401
LIMITED PARTNERS: (Addresses
are as set forth on Schedule I):
DONALD J. TRUMP
By: /s/ DONALD J. TRUMP
------------------------------------------
Donald J. Trump
TRUMP CASINOS, INC.
By: /s/ DONALD J. TRUMP
------------------------------------------
Donald J. Trump
President
TRUMP CASINOS II, INC.
By: /s/ DONALD J. TRUMP
------------------------------------------
Donald J. Trump
President
THCR/LP CORPORATION
By: /s/ JAMES L. WRIGHT III
------------------------------------------
Name: James L. Wright III
Title: Assistant Treasurer
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<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on October 7, 1996, before me, the subscriber,
personally appeared Donald J. Trump, an individual, who, I am satisfied, is the
person who has signed the within instrument on his own behalf, and I having
first made known to him the contents thereof he thereupon acknowledged that he
signed and delivered the said instrument in his personal capacity as an
individual, and that the within instrument is his voluntary act and deed.
/s/
-----------------------------------------
Notary Public
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on October 7, 1996, before me, the subscriber,
personally appeared Robert M. Pickus, the Executive Vice President and Secretary
of Trump Hotels & Casino Resorts, Inc., a Delaware corporation, who, I am
satisfied, is the person who has signed the within instrument on behalf of such
corporation, and I having first made known to him the contents thereof he
thereupon acknowledged that he signed and delivered the said instrument in his
capacity as such officer aforesaid, and that the within instrument is the
voluntary act and deed of said corporation, made by virtue of authority from its
Board of Directors.
/s/
-----------------------------------------
Notary Public
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on October 7, 1996, before me, the subscriber,
personally appeared Donald J. Trump, the President of Trump Casinos, Inc., a New
Jersey corporation, who, I am satisfied, is the person who has signed the within
instrument on behalf of such corporation, and I having first made known to him
the contents thereof he thereupon acknowledged that he signed and delivered the
said instrument in his capacity as such officer aforesaid, and that the within
instrument is the voluntary act and deed of said corporation, made by virtue of
authority from its Board of Directors.
/s/
-----------------------------------------
Notary Public
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on October __, 1996, before me, the subscriber,
personally appeared James L. Wright III, the Assistant Treasurer of THCR/LP
Corporation, a New Jersey corporation, who, I am satisfied, is the person who
has signed the within instrument on behalf of such corporation, and I having
first made known to him the contents thereof he thereupon acknowledged that he
signed and delivered the said instrument in his capacity as such officer
aforesaid, and that the within instrument is the voluntary act and deed of said
corporation, made by virtue of authority from its Board of Directors.
/s/
-----------------------------------------
Notary Public
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on October 7, 1996, before me, the subscriber,
personally appeared Donald J. Trump, the President of Trump Casinos II, Inc., a
New Jersey corporation, who, I am satisfied, is the person who has signed the
within instrument on behalf of such corporation, and I having first made known
to him the contents thereof he thereupon acknowledged that he signed and
delivered the said instrument in his capacity as such officer aforesaid, and
that the within instrument is the voluntary act and deed of said corporation,
made by virtue of authority from its Board of Directors.
/s/
-----------------------------------------
Notary Public
<PAGE>
<TABLE>
SCHEDULE I
AGGREGATE CAPITAL CONTRIBUTIONS*
<CAPTION>
PARTNER CONTRIBUTION PERCENTAGE INTEREST
- ------- ------------ -------------------
<S> <C> <C>
Trump Hotels & Casino Resorts, Inc. $683,659,153.00 59.87743% general partner
Donald J. Trump*** $309,013,680.00 27.06458%** limited partner
725 Fifth Avenue
New York, N.Y. 10022
Trump Casinos, Inc.*** $ 42,210,510.00 3.69695% limited partner
2500 Boardwalk
Atlantic City, NJ 08401
THCR/LP Corporation $ 40,543,547.00 3.55096% limited partner
2500 Boardwalk
Atlantic City, N.J. 08401
Trump Casinos II, Inc.*** $ 66,337,500.00 5.81009% limited partner
2500 Boardwalk
Atlantic City, NJ 08401
</TABLE>
- ---------------
* Aggregate contributions are based on a Common Stock market value of $30.00
per share, the value ascribed to the Common Stock pursuant to the terms of
the Castle Acquisition Agreement.
** Certificate No. 4 , 4-A and 4-B represent a 17.51675%, 0.01928% and 9.52854
percentage interest in the Partnership, respectively.
*** Notwithstanding anything to the contrary in this Agreement, for the
purposes of determining the voting power in THCR of the Class B Stock, (a)
Trump's Percentage Interest evidenced by certificates 4 and 4A and by
certificate 4B shall be evidenced by 800 shares and 50 shares of Class B
Stock, respectively, (b) TCI's Percentage Interest shall be evidenced by 50
shares of Class B Stock and (c) TCI-II's Percentage Interest shall be
evidenced by 100 shares of Class B Stock.
Dated: October 7, 1996
<PAGE>
SCHEDULE II
CAPITAL CONTRIBUTIONS PRIOR TO APRIL 17, 1996
PARTNER CONTRIBUTION PERCENTAGE INTEREST
- ------- ------------ -------------------
Trump Hotels & Casino $140,933,338 60.15936% general partner
Resorts, Inc.
Donald J. Trump $ 93,333,333 39.84064% limited partner
Dated: October 7, 1996
<PAGE>
SCHEDULE III
CAPITAL CONTRIBUTIONS IN CONNECTION WITH THE
TAJ MAHAL MERGER TRANSACTION
PARTNER CONTRIBUTION
- ------- ------------
Trump Hotels & Casino Resorts, Inc. $375,068,151.00
Donald J. Trump $ 4,392.62
Trump Casinos, Inc. $ 43,921,854.66
THCR/LP Corporation $ 40,499,609.57
Dated: October 7, 1996
<PAGE>
SCHEDULE IV
CAPITAL CONTRIBUTIONS IN CONNECTION WITH THE
CASTLE ACQUISITION*
PARTNER CONTRIBUTION
- ------- ------------
Donald J. Trump $108,793,500.00
Trump Casinos II, Inc. $ 66,337,500.00
- ---------------
* Capital contributions are based on a Common Stock market value of $30.00
per share, the value ascribed to the Common Stock pursuant to the terms of
the Castle Acquisition Agreement.
Dated: October 7, 1996
EXHIBIT II.I
SECOND AMENDED AND RESTATED
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
SECOND AMENDED AND RESTATED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT,
dated as of October 7, 1996, by and among Trump Hotels & Casino Resorts, Inc., a
Delaware corporation (the "Company"), Donald J. Trump ("Trump"), Trump Casinos,
Inc., a New Jersey corporation wholly owned by Trump ("TCI") and Trump Casinos
II, Inc., a Delaware corporation wholly owned by Trump ("TCI-II").
WHEREAS, the Company and Trump entered into that certain Exchange and
Registration Rights Agreement (the "Initial Agreement"), dated as of June 12,
1995, relating to the conversion of limited partnership interests in Trump
Hotels & Casino Resorts Holdings, L.P. (the "Partnership") into shares of Common
Stock (as defined below) of the Company and registration rights with respect
thereto;
WHEREAS, in connection with the acquisition by the Partnership of Trump Taj
Mahal Associates ("Taj Associates") and the other transactions related thereto,
the Company, Trump and TCI entered into that certain Amended and Restated
Exchange and Registration Rights Agreement (the "First Amended Agreement"),
dated as of April 17, 1996, relating to (i) the contribution by Trump to Trump
Atlantic City Associates ("Trump AC") (on behalf, and at the direction, of the
Partnership) of 50% of the outstanding capital stock of The Trump Taj Mahal
Corporation, ("TTMC"), which held a .01% general partnership interest in Taj
Associates,(ii) the contribution by TCI to Trump AC (on behalf, and at the
direction, of the Partnership) of its 49.995% general partnership interest in
Taj Associates, (iii) the issuance of limited partnership interests in the
Partnership to each of Trump and TCI in consideration of such contributions by
each of Trump and TCI and (iv) the conversion of such limited partnership
interests in the Partnership into shares of Common Stock and registration rights
with respect thereto;
WHEREAS, in connection with the acquisition by the Partnership of all of
the equity interests of Trump's Castle Associates, L.P. ("Castle Associates")
and the other transactions related thereto, (i) Trump is contributing to the
Partnership his 61.5% equity interest in Castle Associates and (ii) TCI-II is
contributing to the Partnership its 37.5% equity interest in Castle Associates;
WHEREAS, pursuant to the First Amended Agreement, Trump and TCI were issued
certain exchange rights and registration rights in connection with their limited
partnership interests in the Partnership;
WHEREAS, the Company has agreed to grant Trump, TCI and TCI-II the exchange
rights and registration rights set forth below in
<PAGE>
connection with their limited partnership interests in the Partnership; and
WHEREAS, the Company, Trump and TCI have agreed to amend and restate the
First Amended Agreement in its entirety and to add TCI-II as a party.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I.
DEFINITIONS
Section 1.1. Reference to Partnership Agreement. Capitalized terms used
herein and not otherwise defined herein shall have the meaning ascribed to them
in the Third Amended and Restated Agreement of Limited Partnership of the
Partnership, dated as of October 7, 1996 (the "Partnership Agreement").
Section 1.2. CERTAIN DEFINITIONS. Except as otherwise herein expressly
provided, the following terms and phrases shall have the meanings as set forth
below:
"Aggregate Conversion Number" means the sum of the Conversion Numbers of
each Optionee.
"Agreement" means this Amended and Restated Exchange and Registration
Rights Agreement.
"Common Stock" means the common stock, par value $.01 per share of the
Company, and any securities into which the Common Stock has been converted or
exchanged whether pursuant to a Recapitalization Event, Merger or otherwise.
"Company" has the meaning ascribed thereto in the Preamble hereto.
"Conversion Number" means the aggregate number of shares of Common Stock
issuable upon the exercise of an Optionee's entire Exchange Right, which number
shall initially be 10,300,456 with respect to Trump, 1,407,017 with respect to
TCI and 2,211,250 with respect to TCI-II and which numbers shall be adjusted as
provided in Article II.
"Conversion Partner" means an Optionee other than (i) Trump, (ii) TCI,
(iii) TCI-II and (iv) any Permitted Holder with respect to Trump.
"Conversion Right" has the meaning set forth in Section 2.2 hereof.
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<PAGE>
"Determination" has the meaning ascribed thereto in Section 2.7 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC thereunder, all as the same shall be in
effect at the relevant time.
"Exchange Right" has the meaning set forth in Section 2.1 hereof.
"HSR" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
"Letter of Transmittal" means the form of letter attached hereto and made a
part hereof pursuant to which an Optionee may tender his Partnership Interests
in exchange for shares of Common Stock.
"Option" means, collectively, the Conversion Right and the Exchange Right.
"Optionee" means (i) Trump, (ii) TCI, (iii) TCI-II and (iv) each assignee
of Partnership Interests of Trump, TCI and TCI-II and any subsequent assignee.
"Partnership" has the meaning ascribed thereto in the recitals hereto.
"Partnership Agreement" has the meaning ascribed thereto in the recitals
hereto.
"Recapitalization Event" has the meaning set forth in Section 2.4(b)
hereof.
"Registrable Securities" shall mean, collectively, (i) the Common Stock
issued or issuable upon exercise of the Options and (ii) any securities issued
or issuable with respect to such shares of Common Stock by way of stock
dividend, stock split, in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise.
"Registration Expenses" means all expenses required to be disclosed in Item
13 of Part II of the Form S-1 registration statement, or in a comparable section
of any similar form permitting an underwritten public offering, as well as
expenses of underwriters customarily reimbursed by issuers for selling
stockholders and reasonable fees and expenses of one counsel for all selling
stockholders (in respect of a demand registration) and any underwriter (for both
a demand and piggyback registration), but not including underwriting discounts
and commissions and transfer taxes.
-3-
<PAGE>
"Rights" means any rights, options, warrants or convertible securities (or
rights, options or warrants to purchase convertible securities) containing the
right to subscribe for or purchase shares of Common Stock.
"SEC" means the Securities and Exchange Commission and any successor
agency.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC thereunder, all as the same shall be in effect
at the relevant time.
"Settlement Date" has the meaning ascribed thereto in Section 4.1(a)
hereof.
"Special Dividend Record Date" has the meaning set forth in the Company's
Amended and Restated Certificate of Incorporation.
"Stop Order" means, with respect to any registration of the Registrable
Securities or any portion thereof effected pursuant to this Agreement, any stop
order, injunction or other order or requirement of the SEC or any other
governmental or administrative agency, or any act by any court preventing or
otherwise limiting the sale of any Registrable Securities pursuant to such
registration.
"TCI" has the meaning ascribed thereto in the Preamble hereto.
"TCI-II" has the meaning ascribed thereto in the Preamble hereto.
"Trump" has the meaning ascribed thereto in the Preamble hereto.
Section 1.3. RULES OF CONSTRUCTION. In this Agreement, whenever the context
so indicates, the singular or plural number, and the masculine, feminine or
neuter gender shall each be deemed to include the other, and the terms "he" and
"him" shall refer to an Optionee. Words such as "herein," "hereinafter," and
"hereunder" refer to this Agreement as a whole and not merely to a subdivision
in which such words appear unless the context otherwise requires.
-4-
<PAGE>
ARTICLE II.
The Option
Section 2.1. THE EXCHANGE RIGHT. Each Optionee shall have the right (the
"Exchange Right"), exercisable at any time, to require the Company to exchange
shares of Common Stock for all or any portion of the properly tendered
Partnership Interests owned by such Optionee.
Section 2.2. THE CONVERSION RIGHT. The Company (acting through a majority
of the Special Committee) shall have the right (the "Conversion Right"),
exercisable at any time, to require a Conversion Partner to exchange all or any
portion of the Partnership Interests owned by such Conversion Partner for shares
of Common Stock.
Section 2.3. SHARES ISSUABLE UPON EXCHANGE. The number of shares of Common
Stock to be issued by the Company to an Optionee upon exercise of an Exchange
Right or Conversion Right shall be equal to the product of (a) a fraction, (i)
the numerator of which is the Percentage Interest of the Partnership Interests
with respect to which the Option is exercised and (ii) the denominator of which
is the aggregate Percentage Interest of the outstanding Partnership Interests
held by such Optionee immediately prior to such exercise, multiplied by (b) such
Optionee's Conversion Number.
Section 2.4. ADJUSTMENT OF THE CONVERSION NUMBER. The Conversion Number
shall be adjusted as provided in this Section 2.4 as follows:
(a) An Optionee's Conversion Number shall be reduced by the number of
shares of Common Stock issued upon any exercise of its Option. Upon an
assignment of Partnership Interests by an Optionee in accordance with the
terms of the Partnership Agreement, such Optionee's Conversion Number shall
be reduced appropriately, and the Conversion Number of the assignee of such
Partnership Interests shall be equal to the amount of such reduction, or in
the case of an assignee who is also a holder of Partnership Interests, such
assignee's Conversion Number shall increase by the amount of such
reduction.
(b) Except in respect of transactions described in paragraph (c)
below, in case the Company shall (i) pay a dividend on the Common Stock in
additional shares of equity securities of the Company, (ii) subdivide or
reclassify its Common Stock, (iii) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock, or (iv) issue by
reclassification of its Common Stock other securities of the Company (each
a "Recapitalization Event"), each Optionee's Conversion Number immediately
prior to the
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Recapitalization Event shall be adjusted such that the Conversion Number
after the Recapitalization Event shall equal, the kind and amount of shares
and other securities and property which the Optionees would have owned or
have been entitled to receive after the happening of such Recapitalization
Event had all of the Options been exercised immediately prior to such
Recapitalization Event (or any record date with respect thereto). Any
adjustment made pursuant to this paragraph (b) shall become effective
immediately after the effective date of such event and such adjustment
shall be retroactive to the record date, if any, for such event.
(c) In case the Company shall issue Rights pro rata to all holders of
Common Stock, and the consideration payable upon exercise or conversion of
any such Right to acquire one share of Common Stock is less than the
Current Market Price on the date of and immediately prior to such issuance
of Rights, then upon the expiration of the period during which such Rights
may be exercised or converted (the "Rights Exercise Period") each
Optionee's Conversion Number immediately prior to such expiration shall be
adjusted to be that number of shares of Common Stock equal to the product
of (i) such Optionee's Conversion Number immediately prior to such
expiration and (ii) a fraction, (A) the numerator of which is equal to the
sum of (I) the total number of shares of Common Stock outstanding
immediately prior to such issuance and (II) the number of shares of Common
Stock issued upon exercise or conversion of such Rights and (B) the
denominator of which is equal to the sum of (I) the total number of shares
of Common Stock outstanding immediately prior to such issuance and (II) the
number of shares of Common Stock which the aggregate consideration payable
upon exercise or conversion of such Rights would purchase at the Current
Market Price on the date of issuance of the Rights; provided, however, in
no event shall such fraction be less than one. If an Option is exercised
during the period commencing on the record date for the issuance of the
Rights and ending on the expiration of the Rights Exercise Period, then (r)
the Conversion Number upon such exercise shall be adjusted as provided in
this Section 2.4(c), as if such exercise date were the end of the Rights
Exercise Period, utilizing for purposes of clause (ii)(A)(II) the number of
shares of Common Stock issued upon exercise or conversion of Rights as of
such date; provided, further, that in no event shall the fraction in clause
(ii) be less than one; and (s) at the end of the Rights Exercise Period,
the Optionee shall be issued an additional number of shares equal to the
excess, if any, of the number of shares of Common Stock which would have
been issued had such Option been exercised at the end of the Rights
Exercise Period over the number of shares actually issued upon exercise of
the Option.
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(d) In case the Percentage Interest of the Partnership Interests held
by an Optionee shall increase as the result of the contribution by such
Optionee of additional consideration or otherwise to the Partnership (a
"Contribution"), then the Conversion Number shall be adjusted such that (i)
such Optionee's Conversion Number immediately after the Contribution
divided by the sum of the number of outstanding shares of Common Stock plus
the new Aggregate Conversion Number shall equal (ii) the product of (A) a
fraction, (I) the numerator of which is the aggregate Percentage Interest
of such Optionee immediately after the Contribution, and (II) the
denominator of which is the aggregate Percentage Interest of such Optionee
immediately prior to the Contribution, and (B) a fraction, (I) the
numerator of which is such Optionee's Conversion Number immediately prior
to the Contribution, and (II) the denominator of which is the sum of the
Aggregate Conversion Number immediately prior to the Contribution and the
number of outstanding shares of Common Stock.
(e) In case of any consolidation or merger of the Company with or into
another entity as a result of which the holders of Common Stock become
holders of other shares or securities of the Company or of another entity
or person, or such holders receive cash or other assets, or in case of any
sale or conveyance to another person of the property, assets or business of
the Company as an entirety or substantially as an entirety, the Company or
such successor or purchasing entity or person, as the case may be, shall
execute with the Optionees an agreement that (i) the Optionees shall have
the right thereafter to receive upon exercise of their Options the kind and
amount of shares and other securities and property which it would have
owned or have been entitled to receive after the happening of such
consolidation, merger, sale or conveyance had its Option been exercised
immediately prior to such action and (ii) that this Agreement, including,
without limitation, the registration rights in Article V hereof, shall
continue in full force and effect notwithstanding the consummation of such
transaction and that such person or entity shall assume the obligations of
the Company hereunder. The agreements referred to in this Section 2.4(e)
shall provide for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in the other provisions in this
Section 2.4. The provisions of this Section 2.4(e) shall similarly apply to
successive consolidations, mergers, sales or conveyances.
Section 2.5. COMPANY'S COVENANT REGARDING CERTAIN RIGHTS OFFERINGS. The
Company covenants and agrees that it shall not issue Rights pro rata to all
holders of Common Stock, unless such Rights are exercisable or convertible for a
period not in excess of sixty (60) days from their date of issuance.
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Section 2.6. RESERVATION. The Company shall at all times reserve and keep
available out of its authorized but unissued Common Stock the full number of
shares of Common Stock deliverable at such time upon the exercise of the Options
and shall take all such action and obtain all such permits or orders as may be
necessary to enable the Company lawfully to issue such Common Stock upon the
exercise of the Option and to cause such Common Stock to be fully paid and
nonassessable.
Section 2.7. DETERMINATION OF NUMBER OF SHARES. The Company shall calculate
(each calculation, a "Determination") the number of shares of Common Stock to be
issued upon the exercise of an Option pursuant to this Agreement in connection
with such exercise. After each exercise of an Option, the Company shall promptly
provide the Optionees a report, certified by the Chief Financial Officer of the
Company and its independent public accountants, setting forth the Determination,
and setting forth in reasonable detail the method of calculation and the facts
upon which such calculation is based. Each Determination will be made by the
Company in good faith and in accordance with the provisions hereof. The Company
shall, at any time upon the written request of an Optionee, furnish to such
Optionee a like report setting forth the number of shares of Common Stock
issuable upon the exercise of an Option and showing in reasonable detail the
derivation of such number of shares of Common Stock.
Section 2.8. CONTINUOUS OFFER. This Agreement is a continuous offer and may
not be withdrawn, changed or modified by the Company or a Conversion Partner
without the prior written consent of the Company and each Optionee.
ARTICLE III.
Procedure for Exercising the Option
Section 3.1. THE EXERCISE OF THE EXCHANGE RIGHT.
(a) Each Optionee desiring to exercise his Exchange Right with respect
to all or a portion of his Partnership Interests may do so by delivering to
the Company, at 2500 Boardwalk, Atlantic City, New Jersey 08401, Attn:
Corporate Secretary (or such other address as the Company shall provide in
writing to each Optionee) a completed and duly executed Letter of
Transmittal and any other documents required by the Letter of Transmittal.
(b) The tender of Partnership Interests pursuant to this Section 3.1
shall constitute a binding agreement between the tendering Optionee and the
Company and will not be subject to withdrawal or change except with the
consent of the Company.
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(c) All questions as to the validity and form of any tender of
Partnership Interests upon the exercise of the Option will be determined in
good faith by the Company.
Section 3.2. REPRESENTATION OF OPTIONEE. Any exercise of an Exchange Right
hereunder by an Optionee shall constitute a representation by such Optionee that
it is acquiring the Common Stock to be issued upon the exercise of the Exchange
Right for purposes of investment and not with a view to distribution (without
any limitation of any rights such Person may have under Article V hereof) in
violation of any federal or state securities laws.
Section 3.3. THE EXERCISE OF THE CONVERSION RIGHT.
(a) If the Company exercises the Conversion Right with respect to all
or a portion of the Partnership Interests of a Conversion Partner, the
Company may do so by delivering to the Conversion Partner at his address
appearing on the books of the Partnership, a notice setting forth (i) the
Company's election to exercise the Conversion Right, (ii) the portion of
the Partnership Interest with respect to which the Conversion Right is
exercised, and (iii) that delivery of shares of Common Stock as the
consideration for the Partnership Interest subject to the Conversion Right
shall not be made until the Conversion Partner has submitted a duly
completed Letter of Transmittal and any other documents required by the
Letter of Transmittal, which Letter of Transmittal and other documents
shall be completed and delivered promptly to the Company.
(b) All questions as to the validity and form of any tender of
Partnership Interests upon the exercise of the Conversion Right will be
determined in good faith by the Company.
ARTICLE IV.
Settlement of the Option
Section 4.1. SETTLEMENT OF THE OPTION.
(a) Upon the terms and subject to the conditions of this Agreement,
the Company will issue shares of Common Stock for Partnership Interests
properly tendered on that date (the "Settlement Date") which is the later
of: (i) the expiration of three (3) Business Days from the date that the
Company receives the tender of the Partnership Interests in proper form and
meeting all of the requirements of this Agreement, which requirements may
be waived by the Company in connection with a Conversion Right, (ii) the
earlier of (A) ten (10) Business Days after the exercise of the Exchange
Right, or (B) one day after the Special Dividend
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Record Date, and (iii) the expiration or termination of the waiting period
applicable to each tender, if any, under HSR. The Optionee shall be deemed
to be the record holder of the Common Stock issuable upon exercise of the
Option on the Settlement Date, notwithstanding the fact that certificates
with respect to such shares of Common Stock may not have been issued on
such date.
(b) Upon the exercise of an Option, the General Partner shall use its
reasonable best efforts (including, without limitation, forming and
properly capitalizing a subsidiary for the purpose of holding all or a
portion of the Partnership Interests being transferred upon exercise of the
Option) and cooperate with the remaining Optionees to the extent necessary
to preserve the treatment of the Partnership as a pass-through entity for
federal tax purposes.
(c) Each tender and the issuance of Common Stock with respect thereto
will be subject to any change in securities or other applicable law
imposing limits or conditions on such tender or the issuance of Common
Stock with respect thereto.
(d) Payment for the Partnership Interests tendered pursuant to this
Agreement will be made only after timely receipt by the Company of (i)
Certificates of Interest with respect to such Partnership Interests, duly
completed and executed by the Partnership in the name of the Optionee and
duly endorsed by the Optionee for transfer to, or accompanied by stock
powers duly executed by the Optionee in favor of, the Company, (ii) a
properly completed and duly executed Letter of Transmittal and (iii) any
other documents required by the Letter of Transmittal.
Section 4.2. TAX WITHHOLDING. Unless an exception applies under applicable
law and regulations, the Company will be required to withhold, and will
withhold, 31 percent (or such other amount as applicable law may require) of the
gross proceeds (including dollar equivalent of shares of Common Stock) paid to a
tendering Optionee unless the Optionee provides his tax identification number
(employer identification number or Social Security Number) and certifies that
such number is correct.
Section 4.3. RIGHTS AS PARTNER/STOCKHOLDER.
(a) No Optionee shall, by virtue of this Agreement, have any rights as
a stockholder of the Company until such time as that person becomes a
holder of record of shares of Common Stock.
(b) The Company, effective as of the Settlement Date with respect to
any tendered Partnership Interest, assumes all obligations related to the
tendered Partnership Interest
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and will hold the Person tendering that Partnership Interest harmless from
any such obligations other than with respect to any breach of any
representation contained in the Letter of Transmittal to be delivered in
connection with the exercise of rights pursuant to this Agreement.
(c) Until the Settlement Date, each tendering Optionee shall continue
to own his respective tendered Partnership Interests, and will continue to
be treated as the holder of such tendered Partnership Interests for all
purposes of the Partnership Agreement, including, without limitation, for
purposes of voting, consent, allocations and distributions (subject only to
reasonable accounting conventions adopted by the Partnership for purposes
of determining the partners' varying percentage interests in the
Partnership during the taxable year). Tendered Partnership Interests will
be transferred to the Company only upon receipt by the tendering Optionee
of Common Stock in payment in full therefor.
Section 4.4. HSR. If in connection with the exercise of an Option, such
Optionee is required to file a notification form pursuant to the HSR, then as
promptly as practicable, and in any event within ten (10) Business Days
following the exercise of the Option, such Optionee and the Company shall each
prepare and file, or shall cause its "ultimate parent" (as defined in the HSR)
to prepare and file, any required notification and report form under the HSR, in
connection with the transactions contemplated hereby, the filing fees for which
shall be borne by the Company. Such Optionee and the Company shall, or shall
cause their ultimate parents to, request early termination of the waiting period
with respect to such filing and to respond with reasonable diligence to any
request for additional information made in response to such filings.
ARTICLE V.
Registration Rights
Section 5.1. REGISTRATION ON DEMAND.
(a) Upon written notice to the Company from holders of at least twenty
percent (20%) of the Registrable Securities, determined as if the Exchange
Right had been fully exercised, of their desire to cause a registration of
the Registrable Securities, the Company shall (i) inform the other holders
of Registrable Securities (at least 30 days prior to the proposed filing of
any registration statement), such notice to state the identity of the
holders requesting registration and the number of Registrable Securities
proposed to be sold thereby, and take appropriate action, on a reasonably
timely basis, to file with the SEC a registration statement on the
appropriate form covering all Registrable Securities specified in such
demand and by such
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other holders (by notice given to the Company within 15 days after the date
the Company notified them of such demand), (ii) use best efforts to cause
such registration statement to become effective under the Securities Act
and (iii) use best efforts to qualify such resale under those state
securities laws reasonably requested by the holders of a majority of
Registrable Securities to be included in such registration; provided,
however, that such effort shall not require the Company to qualify as a
foreign corporation or subject itself to taxation in any jurisdiction where
it is not already so qualified or subject. The Company shall be obligated
to effect four (4) registrations pursuant to this Section 5.1. The Company
shall be obligated to effect any registration pursuant to this Section 5.1
as promptly as practicable upon receipt from the requisite number of
holders of Registrable Securities of the notice requesting such
registration; provided, however, that the Company shall have the right to
delay any registration pursuant to this Section 5.1 for one period of up to
thirty (30) days if the Board of Directors of the Company shall have
determined (and passed a resolution to such effect) that to effectuate such
registration at such time would materially and adversely affect the Company
and be materially detrimental to the business and operations thereof (a
"Blackout Determination"), which period may be extended for an additional
thirty (30) days upon a second Blackout Determination upon the expiration
of the first thirty (30) day period.
(b) The Company will be obligated to pay all Registration Expenses
with respect to the registrations pursuant to this Section 5.1.
(c) Registrable Securities will cease to be such when (i) a
registration statement covering such Registrable Securities has been
declared effective and they have been disposed of pursuant to such
effective registration statement, (ii) such Registrable Securities shall
have been otherwise transferred, and the Company shall have delivered new
certificates or other evidences of ownership for them not subject to any
stop transfer order or other restriction on transfer and not bearing a
legend restricting transfer in the absence of an effective registration or
an exemption from the registration requirements of the Securities Act and
subsequent disposition of them shall not require registration or
qualification of them under the Securities Act or any similar state law
then in force, or (iii) such Registrable Securities shall have ceased to be
outstanding.
(d) A registration requested pursuant to this Section 5.1 will not be
deemed to have been effected unless it has been declared effective by the
SEC and the Company has complied with all of its obligations under this
Agreement with respect thereto (without regard to the use of best
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efforts or the like); provided that, such registration will be deemed not
to have been effected if after such registration has become effective, the
offering of the Registrable Securities (or any portion thereof) pursuant to
such registration is withdrawn or is or becomes the subject of any Stop
Order. If (i) a registration requested pursuant to this Section 5.1 is
deemed not to have been effected or (ii) the registration requested
pursuant to this Section 5.1 does not remain effective for a period of at
least 360 days, then (x) such requested registration shall not be deemed to
be an effective registration pursuant to this Section 5.1 and (y) such
requested registration shall not reduce the number of registrations the
Company shall be obligated to effect pursuant to this Section 5.1.
(e) Any offering of Registrable Securities contemplated by this
Section 5.1 shall, unless the holders of a majority of the Registrable
Securities to be included in such offering determine otherwise, be a firm
commitment underwritten offering and the managing underwriter for such
offering shall be chosen by the holders of a majority of the Registrable
Securities to be included therein, which managing underwriter shall be
reasonably acceptable to the Company.
(f) The Company shall not, without the prior written consent of the
holders of a majority of the Registrable Securities to be included in any
registration requested pursuant to this Section 5.1, include in such
registration, any other securities of the Company; provided, however, that
the Company may include in any such registration any securities to the
extent that the inclusion of such securities does not have the effect
referred to in Section 5.1(g) hereof and so long as the sale of such
securities is included in the underwriting of the Registrable Securities
and the same underwriters are used.
(g) If the managing underwriter in a public offering to be effected
pursuant to the provisions of this Section 5.1 advises the Company and the
holders of the Registrable Securities in writing that, in its opinion,
inclusion in the registration of the total amount of securities requested
to be registered will materially and adversely affect the offering price of
such securities or will materially and adversely affect the market for such
securities, then, to the extent necessary, up to the entire amount of any
securities proposed to be included in such registration which are not
Registrable Securities shall be eliminated.
(h) The Company shall not be required to register Registrable
Securities which, together with any other securities to be included in such
registration, have a value, based on the proposed offering price, of less
than $2,000,000.
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Section 5.2. INCIDENTAL REGISTRATION.
(a) If the Company intends to file a registration statement on Form
S-1, S-2 or S-3 (or other appropriate form) for the registration of an
offering of equity securities with the SEC, the Company shall notify each
of the holders of record of Registrable Securities at least 30 days prior
to each such filing of the Company's intention to file such a registration
statement, such notice shall state the number of shares of equity
securities proposed to be registered thereby. If any holder of Registrable
Securities notifies the Company within ten days after receipt of such
notice from the Company of its desire to have included in such registration
statement any of its Registrable Securities, then the Company shall cause
the Company to include such shares in such registration statement. The
Company shall pay all the Registration Expenses of such registration.
(b) The Company may in its discretion withdraw any registration
statement filed pursuant to this Section 5.2 subsequent to its filing
without liability to the holders of Registrable Securities.
(c) In the event that the managing underwriter for any such offering
described in this Section 5.2 notifies the Company that, in good faith, it
is able to proceed with the proposed offering only with respect to a
smaller number of securities (the "Maximum Number") than the total number
of Registrable Securities proposed to be offered by such holders and
securities proposed to be offered by the Company and all others entitled to
registration rights under such registration statement, then the Company
shall reduce the number of securities held by persons (the "Piggyback
Holders") other than the Company and persons exercising demand registration
rights to be included in such registration, to the extent necessary to
reduce the number of securities to be included in such registration to an
amount equal to the Maximum Number. Such amount will be allocated pro rata
in accordance with the number of securities proposed to be offered by each
Piggyback Holder (including the holders of Registrable Securities).
Section 5.3. INDEMNITY AND CONTRIBUTION.
(a) In connection with a registration statement filed with the SEC
pursuant to this Article V, the Company shall provide each holder of
Registrable Securities included in such registration statement, each
officer and director of any thereof, and each person who controls such
holder within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act, with indemnification against any losses, claims,
damages or liabilities, reasonable attorneys
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fees, costs or expenses and costs and expenses of investigating and
defending any such claims (collectively "Damages"), joint or several, to
which any of them may become subject under the federal securities laws, or
otherwise, in form and substance as is customarily given to underwriters in
an underwritten offering of securities. Each holder including Registrable
Securities in any such registration statement agrees that it shall
indemnify the Company, each officer and director thereof, and each person
who controls the Company within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act, against any Damages, in form and
substance as is customarily given by selling shareholders to a publicly
held corporation in an underwritten public offering of securities, but only
to the extent that such Damages (or proceedings in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained, on the effective date thereof, in any
registration statement under which such securities are registered under the
Securities Act, in any preliminary prospectus or final prospectus contained
therein or in any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, which, in each such case, has been made in or
omitted from such registration statement, said preliminary or final
prospectus or said amendment or supplement, solely in reliance upon, and in
conformity with, written information furnished to the Company by such
holder of Registrable Securities.
(b) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section
5.3(a) is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, each of the
Company and the holders of the Registrable Securities included in such
registration shall contribute to the aggregate Damages contemplated by said
indemnity agreement incurred by each of the Company and such holders of the
Registrable Securities, as incurred, in such proportions as is appropriate
to reflect the relative fault of the Company and such holders of the
Registrable Securities in connection with the statements or omissions which
resulted in such Damages. The relative fault of the Company and such
holders of Registrable Securities shall be determined by reference to,
among other things, whether the untrue or alleged untrue statements of a
material fact or the omission or alleged omission to state a material fact
was supplied by the Company or one or more of the holders of Registrable
Securities, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
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(c) In no event shall a holder of Registrable Securities be liable for
indemnification or contribution pursuant to this Article V in excess of the
net proceeds received upon the sale of such Registrable Securities.
Section 5.4. CERTAIN PROCEDURES. The Company shall provide each holder of
Registrable Securities included in any registration with a "cold comfort" letter
from the Company's independent public accountants, in customary form covering
those matters customarily covered by a "cold comfort" letter with respect to any
such registration statement and addressed to such holder, and the Company shall
use its best efforts to execute and deliver with underwriters for the offering
covered by any such registration statement, an underwriting agreement in form
and substance customarily executed for public offerings of common stock. Any
holder of Registrable Securities that includes shares in the registration shall
also be a party to such underwriting agreement.
Section 5.5. RULE 144 REPORTING. With a view to making available to the
holders of Registrable Securities the benefits of certain rules and regulations
of the SEC which may permit the sale of the Registrable Securities to the public
without registration, the Company agrees to, at all times:
(a) make and keep available current public information concerning the
Company as those terms are understood and defined in Rule 144 under the
Securities Act ("Rule 144");
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange
Act; and
(c) furnish to each holder of Registrable Securities forthwith, upon
such holder's request, a written statement by the Company as to its
compliance with the reporting requirements of Rule 144 and of the
Securities Act and the Exchange Act, a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so
filed by the Company as such holder may reasonably request in availing
itself of any rule or regulation of the SEC allowing it to sell any such
securities without registration.
Section 5.6. LOCK-UPS. After receipt of any notice pursuant to Section 5.1
or 5.2 hereof, each holder of Registrable Securities and the Company shall not
demand or request a registration of securities of the Company or otherwise offer
or sell securities until the later of (i) 90 days after the effective date of
the registration statement in respect of which such notice was given, (ii) 150
days after the date such notice was given or (iii) the date such registration
statement is withdrawn by the Company. To the extent requested by the managing
underwriter in respect of an offering of securities of
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the Company described in this Article V, each holder of Registrable Securities
and the Company shall agree to refrain from selling or offering to sell any
securities of the Company within 120 days after the effective date of any
registration statement described herein; provided, however, that any pledgee of
Registrable Securities shall not be bound by this requirement in connection with
a private sale by it of its collateral. Nothing in this Section 5.6 shall
preclude the Company from issuing shares of Registrable Securities upon exercise
of an Option.
Section 5.7. NO INCONSISTENT PROVISIONS. The Company shall not, without the
prior written consent of the holders of a majority of the Registrable Securities
include, or grant to any Person the right to request the Company to include, in
such registration, any other securities of the Company that are inconsistent
with the priorities, rights and privileges of the holders of Registrable
Securities contained in this Agreement.
ARTICLE VI.
Miscellaneous
Section 6.1. WAIVER, AMENDMENT. Neither this Agreement nor any provisions
hereof shall be waived, modified, changed, discharged or terminated except by an
instrument in writing signed by the party against whom any waiver, modification,
change, discharge or termination is sought.
Section 6.2. ASSIGNABILITY. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by either an Optionee or the Company, without the prior written
consent of the other parties; provided, however, that the rights granted to an
Optionee hereunder shall automatically be assigned in connection with an
assignment of Partnership Interests or Registrable Securities; provided,
further, that the rights granted hereunder may be assigned to, and exercised by,
a secured creditor to whom an Optionee has pledged Partnership Interests or
Registrable Securities.
Section 6.3. ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to the
transactions contemplated hereby and supersedes any and all prior agreements and
understandings relating to the subject matter hereof. No representation, promise
or statement of intention has been made by any party hereto which is not
embodied in this Agreement or the written statements, certificates, exhibits or
other documents delivered pursuant hereto or in connection with the transactions
contemplated hereby, and no party hereto shall be bound by or liable for any
alleged representation, promise or statement of intention not set forth herein
or therein. The documents referred to in the immediately preceding sentence are
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incorporated by reference herein and shall be deemed a part of this Agreement.
By executing and delivering this Agreement, the Company, Trump and TCI agree to
the termination of the First Amended Agreement and to the amendment and
restatement thereof by this Agreement.
Section 6.4. SEVERABILITY. If any provision of this Agreement or the
application of any such provision to any person or circumstance shall be held
invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, this Agreement shall continue in full force and effect without
said provision; provided that, no such severance of provision shall be effective
if it materially changes the economic benefit of this Agreement to any Person.
Section 6.5. SECTION AND OTHER HEADINGS. The section headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
Section 6.6. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, regardless of
the law that might be applied under principles of conflicts of law.
Section 6.7. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which together shall be deemed to be one and the same
agreement.
Section 6.8. SPECIFIC PERFORMANCE. Without limiting or waiving in any
respect any rights or remedies of an Optionee under this Agreement, or now or
hereinafter existing at law or in equity or by statute, the Company agrees that
the Optionees shall be entitled to seek specific performance of the obligations
to be performed by the Company in accordance with the provisions of this
Agreement.
Section 6.9. NOTICE. Each notice, demand, request, request for approval,
consent, approval, disapproval, designation or other communication (each of the
foregoing being referred to herein as a "notice") required or desired to be
given or made under this Agreement shall be in writing (except as otherwise
provided in this Agreement), and shall be effective and deemed to have been
received (i) when delivered in person, (ii) when sent by facsimile transmission
with receipt acknowledged, (iii) three (3) days after having been mailed by
certified or registered United States mail, postage prepaid, return receipt
requested, or (iv) the next business day after having been sent by a nationally
recognized overnight mail or courier service, receipt requested (a) if to any
Optionee, at such address or to the telefax number as such Optionee shall have
furnished the Company in writing, or (b) if to the Company, at the address of
its principal executive
-18-
<PAGE>
offices and addressed to the attention of the Corporate Secretary, or at such
other address or to the telefax number as the Company shall have furnished to
each Optionee.
-19-
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
day and date first set forth above.
TRUMP HOTELS & CASINO RESORTS, INC.
By: /s/ ROBERT M. PICKUS
-------------------------------
Robert M. Pickus
Executive Vice President
TRUMP CASINOS, INC.
By: /s/ DONALD J. TRUMP
-------------------------------
Donald J. Trump
President
/s/ DONALD J. TRUMP
-------------------------------
Donald J. Trump
TRUMP CASINOS II, INC.
By: /s/ DONALD J. TRUMP
-------------------------------
Donald J. Trump
President
-20-
<PAGE>
LETTER OF TRANSMITTAL
To Tender Partnership Interests
Pursuant to the Second Amended and Restated Exchange and
Registration Rights Agreement
Dated as of October 7, 1996
of
Trump Hotels & Casino Resorts, Inc.
TO: Trump Hotels & Casino Resorts, Inc.
2500 Boardwalk
Atlantic City, New Jersey 08401
Attn: Corporate Secretary
Description of Partnership Interests
- --------------------------------------------------------------------------------
Names(s) and Address(es) Partnership Interest Certificate(s)
of Registered Owners Enclosed (Attach additional list if
necessary)
Partnership Partnership Partnership
Interest Interests Interests
Certificate Represented Being
Number(s) by Tendered
Partnership
Interest
Certificate(s)
--------------------------------------------------
Total
Unless otherwise indicated, it will be assumed that all Partnership Interests
evidenced by any Partnership Interest Certificate(s) delivered to the Company
are being tendered. If, for any reason, Partnership Interest Certificates are
not being issued by Trump Hotels & Casino Resorts Holdings, L.P., all provisions
in this Letter of Transmittal referring thereto shall be of no effect. See
instruction 4.
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Gentlemen:
The undersigned hereby tenders to Trump Hotels & Casino Resorts, Inc., a
Delaware corporation (the "Company"), the above-described Partnership Interests
as defined in the Company's Second Amended and Restated Exchange and
Registration Rights Agreement dated as of October 7, 1996 (the "Agreement") in
accordance with the terms and conditions of the Agreement and this Letter of
Transmittal (which together constitutes the "Tender"), receipt of which is
hereby acknowledged. All terms used herein but not defined herein are used as
defined in the Agreement.
Subject to, and effective upon, payment (i.e., issuance of shares of Common
Stock) for the Partnership Interests tendered herewith, the undersigned hereby
assigns and transfers to the Company all right, title and interest in and to all
the Partnership Interests that are being tendered hereby and irrevocably
constitutes and appoints the Company (the "Agent"), with full power of
substitution (such power of attorney being deemed to be an irrevocable power
coupled with an interest), to (a) present such Partnership Interests for
transfer on the Partnership's books and (b) receive all rights, privileges and
benefits, and any and all obligations and liabilities appertaining thereto and
otherwise exercise all rights of beneficial ownership of such Partnership
Interests, all in accordance with the terms of the Tender.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the tendered
Partnership Interests and that upon payment, the Company will acquire
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances and the same will not be subject to any adverse claim. The
undersigned will, upon request, execute any additional documents deemed by the
Agent or the Company to be reasonably necessary or desirable to complete the
sale, assignment and transfer of the tendered Partnership Interests. If not sold
pursuant to an effective registration statement, the shares of Common Stock
issued will bear an appropriate legend indicating that such shares have not been
registered under the Securities Act and resale of such Common Stock is
restricted under applicable securities laws.
<PAGE>
All authority conferred or agreed to be conferred in this Letter of
Transmittal shall not be affected by, and shall survive, the death or incapacity
of the undersigned, and any obligation of the undersigned hereunder shall be
binding upon the successors, assigns, heirs, executors, administrators and legal
representatives of the undersigned. Except as stated in the Agreement, this
Tender is irrevocable.
The undersigned understands that a tender of Partnership Interests pursuant
to the Agreement constitutes a binding agreement between the undersigned and the
Company upon the terms and subject to the conditions of the Agreement.
Unless otherwise indicated under "Special Delivery Instructions", please
mail the shares of Common Stock for the purchase price and/or return the
Partnership Interest Certificate for Partnership Interests not tendered (and
accompanying documents, as appropriate) to the address(es) of the registered
holder(s) appearing under "Description of Partnership Interests."
In the event that the Special Delivery Instructions are completed, please
issue the shares of Common Stock for the purchase price and any Certificate for
Partnership Interests not tendered in the name of the registered holder(s) and
transmit the same to the person or persons so indicated.
The Company, effective as of the Settlement Date (as defined in the
Agreement), will assume all obligations related to the tendered Partnership
Interests and will hold the undersigned harmless from such obligations,
including any liabilities, demands, claims, actions or causes of action,
assessments, losses, fines, penalties, costs, damages and expenses as a result
of or arising out of the ownership of such tendered Partnership Interests.
The Company and the undersigned agree that they will cooperate with each
other and will make, execute, acknowledge, deliver, record and file, or cause to
be made, executed, acknowledged, delivered, recorded and filed, at such times
and places as the other may reasonably deem necessary, all other and further
documents and instruments, and will take all other and further actions, as the
other may reasonably request from time to time in order to effectuate the
purposes and provisions of the tender made pursuant to this Letter of
Transmittal.
-2-
<PAGE>
SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 5 and 6)
- --------------------------------------------------------------------------------
To be completed ONLY if (a) the Certificate of Interests includes Partnership
Interests not tendered and/or (b) shares of Common Stock for the purchase price
of Partnership Interests purchased are to be sent (i) to someone other than the
undersigned or (ii) to the undersigned at an address other than that above.
Mail [ ] Certificate(s) for shares of Common Stock
[ ] Certificate of Interests for Partnership
Interests not tendered
To:
Name _________________________________________________________
(please print)
Address ______________________________________________________
______________________________________________________________
(include Zip Code)
______________________________________________________________
______________________________________________________________
(Tax Identification or Social Security Number)
- --------------------------------------------------------------------------------
<PAGE>
SIGN HERE
Complete Substitute Form W-9 included
________________________________________________________________________________
________________________________________________________________________________
(Signature(s) of holder of Partnership Interests)
(Must be signed by registered holder(s) as name(s) appear(s) on Partnership
Interest Certificate(s). If signature is by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity, please set forth full title and see
instruction 5.
Dated___________________________________________________________
Name(s)_________________________________________________________
(please print)
Capacity
(Full Title)__________________________________________________
Address_________________________________________________________
________________________________________________________________
(include Zip Code)
Area Code and Tel. No.__________________________________________
Tax Identification or
Social Security No.___________________________________________
(Complete Substitute Form W-9)
Guarantee of Signature(s)
(See Instruction 1)
Authorized Signature____________________________________________
Name of Firm____________________________________________________
Dated___________________________________________________________
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Amended and Restated
Exchange and Registration Rights Agreement
1. GUARANTEE OF SIGNATURE. No signature guarantee on this Letter of
Transmittal is required unless the registered holder of the Partnership
Interests has completed the box entitled "Special Delivery Instructions". In
such case all signatures on this Letter of Transmittal must be guaranteed by a
member firm of any registered national securities exchange in the United States
or of the National Association of Securities Dealers, Inc. or by a commercial
bank or trust company (not a savings bank or a savings and loan association)
having an office, branch or agency in the United States.
2. DELIVERY OF LETTER OF TRANSMITTAL AND PARTNERSHIP INTEREST
CERTIFICATE(s). This Letter of Transmittal is to be completed by the holder of
Partnership Interests. Partnership Interest Certificate(s) for all Partnership
Interests as well as a properly completed and duly executed Letter of
Transmittal, and any other documents required by this Letter of Transmittal,
must be received by the Agent.
No alternative, conditional or contingent tenders will be accepted.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
Partnership Interest Certificate numbers and/or other information required
should be listed on a separate schedule attached hereto.
4. PARTIAL TENDERS. If fewer than all the Partnership Interests evidenced
by any Certificate submitted are to be tendered, fill in the Percentage Interest
represented by the Partnership Interests which are to be tendered in the box
entitled "Units of Partnership Interests Being Tendered." In such case, a new
Partnership Interest Certificate for the remainder of the Partnership Interests
that was evidenced by old certificate(s) will be sent to the registered holder,
unless otherwise provided in the appropriate box on this Letter of Transmittal,
as soon as practicable. All Partnership Interests represented by Partnership
Interest Certificate(s) delivered to the Agent will be deemed to have been
tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL. The signature must correspond with
the name as written on the face of the Partnership Interest Certificate(s)
without any change whatsoever.
If any of the Partnership Interests tendered hereby are owned of record by
two or more joint owners, all such owners must sign the Letter of Transmittal.
<PAGE>
If any tendered Partnership Interests are registered in different names on
several Partnership Interest Certificates, it will be necessary to complete,
sign and submit as many separate Letters of Transmittal as there are different
registrations of Partnership Interest Certificates.
If this Letter of Transmittal is signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or others
acting in a fiduciary or representative capacity, each person should so indicate
when signing, and proper evidence satisfactory to the Agent of their authority
so to act must be submitted.
6. SPECIAL DELIVERY INSTRUCTIONS. If Partnership Interest Certificate(s)
for unpurchased Partnership Interests are to be returned to a person other than
the signer of this Letter of Transmittal or if a certificate for shares of
Common Stock is to be sent to someone other than the signer of this Letter of
Transmittal or to an address other than that shown above, the appropriate boxes
on this letter of Transmittal should be completed.
7. WAIVER OF CONDITIONS. The Company reserves the right to waive any of the
specified conditions of the Tender in the case of the Partnership Interests
tendered.
8. BACK-UP WITHHOLDING. Under the Federal income tax law, a person
surrendering Partnership Interests must provide the Agent with his correct
taxpayer identification number ("TIN") on Substitute Form W-9 below unless an
exemption applies. If the correct TIN is not provided, a $50 penalty may be
imposed by the Internal Revenue Service and payments made in exchange for the
surrendered Partnership Interests may be subject to back-up withholding of that
rate provided by the Federal income tax law (such rate being at the date hereof,
31%).
The TIN that must be provided is that of the registered holder of the
Partnership Interests. The TIN for an individual is his social security number.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests for
assistance or additional copies of the Agreement and the Letter of Transmittal
may be directed to the Agent at the address set forth above.
-2-
<PAGE>
IMPORTANT TAX INFORMATION
Under Federal income tax laws, a holder whose tendered Partnership
interests are accepted for payment is required by law to provide the Agent (as
payer) with his correct taxpayer identification number on Substitute Form W-9
below. If such holder is an individual, the taxpayer identification number is
his social security number. If the Agent is not provided with the correct
taxpayer identification number, the holder may be subject to a $50 penalty
imposed by the Internal Revenue Service. In addition, payments that are made to
such holder with respect to Partnership Interests purchased pursuant to the
Tender may be subject to back-up withholding.
If back-up withholding applies, the Agent is required to withhold that rate
provided by the Federal income tax law (such rate being at the date hereof, 31%)
of any such payments made to the holder of Partnership Interests. Shares of
Common Stock otherwise deliverable hereunder may, at the expense (and with all
risk of loss for the account) of the undersigned, be sold to pay such amounts.
Back-up withholding is not an additional tax. Rather, the tax liability of
persons subject to back-up withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent back-up withholding on payments that are made to a holder of
Partnership Interests purchased pursuant to the Tender, the holder is required
to notify the Agent of his correct taxpayer identification number by completing
the form below certifying that the taxpayer identification number provided on
Substitute Form W-9 is correct.
WHAT NUMBER TO GIVE THE AGENT
The holder is required to give the Agent the social security number or
employer identification number of the record owner of the Partnership Interests.
<PAGE>
PAYER'S NAME: Trump Hotels & Casino Resorts, Inc.
================================================================================
Substitute | Part 1 -- Please provide your TIN | Social Security
Form W-9 | in the box at right and certify | Number/Employer
| by signing and dating below | Identification
| | Number__________
- --------------------------------------------------------------------------------
Department | Certification -- Under the penalties of |
of the | Perjury, (i) I certify that the |
Treasury/ | information provided on this form is true, |
Internal | correct and complete and (ii) I am not |
Revenue | subject to backup withholding because: (a) |
Service | I am exempt from backup withholding, or |
| (b) I have not been notified by the |
| Internal Revenue Service (IRS) that I am |
| subject to backup withholding as a result |
| of a failure to report all interest or |
| dividends, or (c) the IRS has notified me |
| that I am no longer subject to backup |
| withholding. |
- --------------------------------------------------------------------------------
| |
| Signature ____________________ | Date __________
| |
================================================================================
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACK-UP WITHHOLDING
OF THAT RATE PROVIDED BY THE FEDERAL INCOME TAX LAW (SUCH RATE BEING AT
THE DATE HEREOF, 31%) OF ANY PAYMENTS MADE TO YOU UNDER THE AMENDED AND
RESTATED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT OF TRUMP HOTELS &
CASINO RESORTS, INC.
EXHIBIT VI.III
REGISTRATION AGREEMENT
Reference is made to that certain (i) Pledge and Security Agreement, dated
as of April 17, 1996 (the "Pledge Agreement"), made by Donald J. Trump ("Trump")
and Trump Casinos, Inc. ("TCI") in favor of Donaldson, Lufkin & Jenrette, Inc.
("DLJ") and (ii) Second Amended and Restated Exchange and Registration Rights
Agreement, dated as of the date hereof, by and among Trump, TCI, Trump Casinos
II, Inc. (formerly known as TC/GP, Inc.) ("TCI-II") and Trump Hotels & Casino
Resorts, Inc. ("THCR" and together with Trump, TCI and TCI-II, the "Trump
Parties"), as such agreement may be amended from time to time (the "Exchange
Rights Agreement").
In connection with the execution of that certain Consent and Waiver, dated
as of the date hereof, among DLJ, Trump, TCI, TCI-II, THCR and Trump Hotels &
Casino Resorts Holdings, L.P. ("THCR Holdings"):
1. Trump hereby agrees that if Trump exercises his registration rights
(each a "Trump Exercise") under the Exchange Rights Agreement (the "Registration
Rights") with respect to any limited partnership interests in THCR Holdings (the
"Partnership Interests") beneficially owned by Trump as of the date hereof and
not otherwise pledged to DLJ under the Pledge Agreement (the "Trump
Securities"), he shall simultaneously exercise the Registration Rights with
respect to all of the Partnership Interests pledged to DLJ pursuant to the
Pledge Agreement (the "DLJ Securities"); PROVIDED, HOWEVER, that Trump shall not
be obligated to exercise the Registration Rights with respect to the DLJ
Securities if either (i) the aggregate fair market value of the shares of Common
Stock, par value $.01 per share (the "Common Stock"), of THCR into which Trump
Securities are exchanged in each and all of the Trump Exercises is less than $10
million, (ii) the aggregate number of shares of Common Stock into which Trump
Securities are exchanged in each and all of the Trump Exercises is less than
500,000 shares or (iii) Trump obtains the prior written consent of DLJ.
2. The Trump Parties agree that, in the case of an Event of Default (as
defined in the Pledge Agreement), (i) the right to make any Blackout
Determination (as defined in the Exchange Rights Agreement) shall be waived with
respect to any request to exercise the Registration Rights with respect to the
DLJ Securities and (ii) if Trump exercises the Registration Rights with respect
to the Trump Securities, DLJ, at its option, (notwithstanding Paragraph 1 above)
shall have the right to exercise (or cause Trump to exercise) the Registration
Rights with respect to the DLJ Securities prior to or simultaneously with any
exercise of the Registration Rights with respect to the Trump Securities.
<PAGE>
3. Except as provided herein, all of the terms of the Exchange Rights
Agreement remain in full force and effect.
4. This Registration Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
-2-
<PAGE>
IN WITNESS WHEREOF, the undersigned have caused this Registration Agreement
to be duly executed and delivered as of this 7th day of October, 1996.
/S/
----------------------------
Donald J. Trump
TRUMP HOTELS & CASINO RESORTS, INC.
(only with respect to Paragraphs 2, 3 and 4)
/S/
----------------------------
By: Donald J. Trump
Title: Chairman of the Board
TRUMP CASINOS, INC.
(only with respect to Paragraphs 2, 3 and 4)
/S/
----------------------------
By: Donald J. Trump
Title: President
TRUMP CASINOS II, INC.
(only with respect to Paragraphs 2, 3 and 4)
/S/
----------------------------
By: Donald J. Trump
Title: President
Accepted and Agreed:
DONALDSON, LUFKIN & JENRETTE, INC.
By: /S/
----------------------------
Name: Paul Thompson
Title:
-3-
EXHIBIT VII.I
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities Exchange Act of 1934,
the persons named below hereby agree to the joint filing on behalf of each of
them of a statement on Schedule 13D (including any amendments thereto) with
respect to the Common Stock, par value $.01 per share, of Trump Hotels & Casino
Resorts, Inc., and further agree that this Joint Agreement be included as an
Exhibit to such joint filing.
In evidence thereof, each of the undersigned, being duly authorized, hereby
executes this Joint Filing Agreement as of this 7th day of October 1996.
/s/ DONALD J. TRUMP
--------------------------------------
Donald J. Trump
TRUMP CASINOS, INC.
By:/s/ DONALD J. TRUMP
-------------------------------------
Name: Donald J. Trump
Title: Sole Director,
President and Treasurer
TRUMP CASINOS II, INC.
By:/s/ DONALD J. TRUMP
-------------------------------------
Name: Donald J. Trump
Title: Sole Director,
President and Treasurer
EXHIBIT VIII
================================================================================
AGREEMENT
BY AND AMONG
TRUMP HOTELS & CASINO RESORTS, INC.
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
TC/GP, INC.
TRUMP'S CASTLE HOTEL & CASINO, INC.
AND
DONALD J. TRUMP
------------------------------
Dated as of June 24, 1996
------------------------------
================================================================================
<PAGE>
TABLE OF CONTENTS *
ARTICLE I DEFINITIONS ......................................................2
Section 1.01. Definitions..........................................2
ARTICLE II THE CONTRIBUTION 8
Section 2.01. The Contribution; Consideration......................8
Section 2.02. Closing ............................................10
ARTICLE III REPRESENTATIONS AND WARRANTIES OF TRUMP AND THE
CASTLE ENTITIES..............................................10
Section 3.01. Corporate Organization..............................10
Section 3.02. Capitalization; Title...............................11
Section 3.03. Subsidiaries........................................11
Section 3.04. SEC Reports; Financial Statements...................11
Section 3.05. Absence of Certain Changes or Events................12
Section 3.06. Authorization.......................................12
Section 3.07. No Conflict or Violation............................13
Section 3.08. Consents and Approvals..............................13
Section 3.09. Litigation .........................................14
Section 3.10. Taxes ..............................................14
Section 3.11. Contracts and Leases................................14
Section 3.12. Compliance with Laws................................14
Section 3.13. Absence of Undisclosed Liabilities..................15
Section 3.14. THCR Proxy Statement................................15
Section 3.15. Takeover Provisions Inapplicable....................15
Section 3.16. Brokerage/Finder's Fees.............................15
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE THCR ENTITIES..............16
Section 4.01. Corporate Organization..............................16
Section 4.02. Capitalization......................................16
Section 4.03. Subsidiaries........................................17
Section 4.04. SEC Reports; Financial Statements...................17
Section 4.05. Absence of Certain Changes or Events................18
Section 4.06. Authorization.......................................18
Section 4.07. No Conflict or Violation............................19
Section 4.08. Consents and Approvals..............................20
Section 4.09. Litigation .........................................20
Section 4.10. Taxes ..............................................20
Section 4.11. Contracts and Leases................................20
Section 4.12. Compliance with Laws................................21
Section 4.13. Absence of Undisclosed Liabilities..................21
Section 4.14. THCR Proxy Statement................................21
Section 4.15. Takeover Provisions Inapplicable....................22
Section 4.16. Brokerage/Finder's Fees.............................22
ARTICLE V COVENANTS OF TRUMP AND THE CASTLE ENTITIES.......................22
- -----------
* The Table of Contents is not part of this Agreement.
<PAGE>
Section 5.01. Conduct Pending the Contribution....................22
Section 5.02. No Solicitation.....................................23
Section 5.03. Letters of Accountants..............................24
ARTICLE VI COVENANTS OF THE THCR ENTITIES..................................24
Section 6.01. Conduct Pending the Contribution....................24
Section 6.02. THCR Proxy Statement................................25
Section 6.03. Stockholders Meeting................................25
ARTICLE VII OTHER AGREEMENTS...............................................25
Section 7.01. Registration Rights; Partnership Agreement..........25
Section 7.02. Additional Agreements; Consents.....................26
Section 7.03. Access to Information; Confidentiality..............26
Section 7.04. Notification of Certain Matters.....................27
Section 7.05. HSR Act.............................................28
Section 7.06. Merger Agreement....................................28
Section 7.07. Indemnification.....................................28
Section 7.08. Voting Agreement....................................29
ARTICLE VIII CONDITIONS TO THE CONTRIBUTION................................29
Section 8.01. Conditions of Each Party............................29
Section 8.02. Conditions of Trump.................................30
Section 8.03. Conditions of the THCR Entities.....................31
ARTICLE IX TERMINATION ....................................................32
Section 9.01. Termination ........................................32
Section 9.02. Effect of Termination...............................32
ARTICLE X MISCELLANEOUS ...................................................32
Section 10.01. Notices............................................32
Section 10.02. Survival...........................................33
Section 10.03. Amendment..........................................33
Section 10.04. Waiver.............................................34
Section 10.05. Successors and Assigns.............................34
Section 10.06. Governing Law......................................34
Section 10.07. Gaming Laws........................................34
Section 10.08. Integration........................................34
Section 10.09. Third Party Beneficiaries..........................34
Section 10.10. Specific Performance...............................34
Section 10.11. Remedies Cumulative................................35
Section 10.12. Publicity..........................................35
Section 10.13. Fees and Expenses..................................35
Section 10.14. Headings; Counterparts; Effectiveness..............35
ii
<PAGE>
AGREEMENT
AGREEMENT, dated as of June 24, 1996 (the "Agreement"), by and among TRUMP
HOTELS & CASINO RESORTS, INC., a Delaware corporation ("THCR"), TRUMP HOTELS &
CASINO RESORTS HOLDINGS, L.P., a Delaware limited partnership ("THCR Holdings"
and, collectively with THCR, the "THCR Entities"), TC/GP, INC., a Delaware
corporation ("TC/GP"), TRUMP'S CASTLE HOTEL & CASINO, INC., a New Jersey
corporation ("TCHI" and, together with TC/GP, the "Castle Entities"), and Donald
J. Trump ("Trump"). All foregoing parties to this Agreement are collectively
referred to as the "Parties" and individually as a "Party."
WHEREAS, Trump owns beneficially all of the outstanding equity interest of
Trump's Castle Associates ("Castle Associates"), a New Jersey general
partnership and the owner and operator of Trump's Castle Casino Resort,
directly, as well as indirectly through TCHI and TC/GP, each wholly owned by
Trump (the "Castle Equity");
WHEREAS, Trump and TC/GP each desire to contribute Trump's and TC/GP's
respective equity interests of Castle Associates to THCR Holdings in exchange
for limited partnership interests in THCR Holdings and THCR Holdings desires to
accept such consideration;
WHEREAS, Trump, TCHI and the THCR Entities desire to effect a merger of a
subsidiary of THCR Holdings with and into TCHI;
WHEREAS, as a result of the contributions and merger described in the
immediately preceding recitals (the "Contribution"), the THCR Entities will own
all the Castle Equity;
WHEREAS, simultaneously with the Contribution, Castle Associates shall be
converted from a general partnership to a limited partnership pursuant to an
amendment to the Second Amended and Restated Partnership Agreement of Castle
Associates, dated as of December 30, 1993 (the "Castle Associates Partnership
Agreement");
WHEREAS, prior to or simultaneously with the Contribution, THCR Holdings
Contributions LLC, a Delaware limited liability company and a wholly owned
subsidiary of THCR Holdings ("Contribution Sub"), THCR-TCHI Merger Corp., a
Delaware corporation and a wholly owned subsidiary of THCR Holdings ("Merger Sub
1.0"), TCHI, Castle Associates and Trump's Castle Funding, Inc., a New Jersey
corporation wholly owned by Castle Associates ("Castle Funding"), each shall
have been designated "unrestricted subsidiaries" under the indenture (as
supplemented and amended, the "Senior Note Indenture") pursuant to which the
$155 million aggregate principal amount of 15-1/2% Senior Secured Notes due 2005
of THCR Holdings and Trump Hotels & Casino Resorts
<PAGE>
Funding, Inc., a Delaware corporation ("THCR Funding"), were issued;
WHEREAS, the Special Committee (the "THCR Special Committee") of the
Board of Directors of THCR (the "THCR Board") has received a fairness opinion
from Salomon Brothers Inc ("Salomon") with respect to the fairness, from a
financial point of view to THCR, of the consideration to be paid by the THCR
Entities in the Contribution (the "Salomon Fairness Opinion");
WHEREAS, the THCR Special Committee and the THCR Board have determined
that the Contribution is consistent with and in furtherance of the long-term
business strategy of the THCR Entities;
WHEREAS, the THCR Special Committee and the THCR Board have determined
that the Contribution is fair to, and in the best interests of, THCR and the
holders of THCR's Common Stock, par value $.01 per share (the "THCR Common
Stock"); and
WHEREAS, the THCR Special Committee and the THCR Board have approved
the Contribution and this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements contained herein, the
Parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. As used in this Agreement the following terms
shall have the respective meanings set forth below (terms defined in the
singular shall have the same meanings when used in the plural and vice versa):
"Acquisition Proposal" with respect to any Person shall mean any proposed
(i) merger, consolidation, share exchange or similar transaction involving such
Person or a Subsidiary of such Person, as a result of which the consolidated
assets of such Person and its Subsidiaries, taken as a whole, increase or
decrease by 25% or more, (ii) sale, lease or other disposition directly or
indirectly (other than by merger, consolidation, share exchange or similar
transaction) of assets of such Person or its Subsidiaries representing 25% or
more of the consolidated assets of such Person and its Subsidiaries, (iii)
issue, sale, or other disposition (other than by merger, consolidation, share
exchange or similar transaction) of securities (or options, rights or warrants
to purchase, or securities convertible into, such securities) representing 25%
or more of the voting power of such Person or (iv) transaction in which any
Person shall acquire beneficial ownership, or the right to acquire beneficial
ownership, or any "group" (as such term is defined under the Exchange Act) shall
have been formed which beneficially owns or
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has the right to acquire beneficial ownership, of 25% or more of the outstanding
common stock of such Person (other than Persons or groups having such beneficial
ownership as of the date hereof).
"Agreement" shall have the meaning set forth in the Preamble.
"Castle Associates" shall have the meaning set forth in the Recitals.
"Castle Associates Partnership Agreement" shall have the meaning set forth
in the Recitals.
"Castle Entities" shall have the meaning set forth in the Preamble.
"Castle Equity" shall have the meaning set forth in the Recitals.
"Castle Equity Consideration" shall have the meaning set forth in Section
2.01.
"Castle Funding" shall have the meaning set forth in the Recitals.
"Castle Material Adverse Effect" shall mean a material adverse effect with
respect to the business, results of operations, properties, operations or
financial condition of Castle Associates and Castle Funding, taken as a whole.
"Castle Mortgage Notes" shall mean the 11-3/4% Mortgage Notes due 2003 of
Castle Funding guaranteed by Castle Associates.
"Castle PIK Notes" shall mean the Increasing Rate Subordinated Pay-in-Kind
Notes due 2005 of Castle Funding guaranteed by Castle Associates.
"Castle SEC Reports" shall have the meaning set forth in Section 3.04.
"Castle Senior Notes" shall mean the 11-1/2% Senior Secured Notes due 2000
of Castle Funding guaranteed by Castle Associates.
"Castle Warrant Agent" shall mean First Bank National Association, as
Warrant Agent under the Castle Warrant Agreement.
"Castle Warrant Agreement" shall mean the Warrant Agreement, dated as of
December 30, 1993, between TCHI and the Castle Warrant Agent.
"Castle Warrantholders" shall mean the holders of the Castle Warrants.
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"Castle Warrants" shall mean the warrants issued under the Castle Warrant
Agreement.
"Castle Warrant Consideration" shall have the meaning set forth in Section
2.01.
"Closing" shall have the meaning set forth in Section 2.02.
"Closing Date" shall have the meaning set forth in Section 2.02.
"Confidential Information" shall mean all information about a Party,
whether furnished before or after the date hereof, and regardless of the manner
in which it is furnished, together with all analyses, compilations, studies,
summaries, extracts or other documents, which contain or otherwise reflect such
information. Confidential Information shall not include information which the
recipient can clearly demonstrate falls within any of the following categories:
(i) information which has come within the public domain through no fault or
action of the recipient or its affiliates (including, without limitation, all
information contained in publicly available documents filed with the SEC); (ii)
information which was known to the recipient on a non-confidential basis prior
to its disclosure by a Party; or (iii) information which becomes available to
the recipient on a non-confidential basis from any third party, the disclosure
of which to, or the receipt of which by, the recipient, to the knowledge of the
recipient after due inquiry, does not violate any contractual or legal
obligation said third party has to the disclosing party or any other Person with
respect to such information.
"Contribution" shall have the meaning set forth in the Recitals.
"Contribution Sub" shall have the meaning set forth in the Recitals.
"DGCL" shall mean the Delaware General Corporation Law.
"Disclosing Party" shall mean any Party that discloses or provides
Confidential Information to any other Party to this Agreement.
"Exchange Act" shall mean the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder.
"Exchange Rights Agreement" shall mean the Amended and Restated Exchange
and Registration Rights Agreement, dated as of April 17, 1996, among THCR, Trump
and Trump Casinos.
"Gaming Authority" shall mean the New Jersey Casino Control Commission, the
New Jersey Division of Gaming Enforcement, the Indiana Gaming Commission or any
other governmental agency which
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regulates gaming in a jurisdiction in which either THCR or its Subsidiaries or
Castle Associates or its Subsidiary, as the case may be, conduct gaming
activities.
"Gaming Laws" shall mean any laws, rules, regulations or ordinances
governing gaming activities and any administrative rules or regulations
promulgated thereunder, and any other corresponding statutes, rules and
regulations.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
"Indemnified Party" shall have the meaning set forth in Section 7.07.
"Indemnifying Party" shall have the meaning set forth in Section 7.07.
"Liabilities" shall have the meaning set forth in Section 7.07.
"Lien" shall mean any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation, or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"Merger Sub 1.0" shall have the meaning set forth in the Recitals.
"Midlantic Credit Agreement" shall mean the Amended and Restated Credit
Agreement, dated as of December 28, 1993, among Castle Associates, Castle
Funding and Midlantic National Bank.
"NJBCA" shall mean the New Jersey Business Corporation Act.
"NYSE" shall mean the New York Stock Exchange.
"Party" shall have the meaning set forth in the Preamble.
"Person" shall mean any individual, partnership, corporation, trust,
association, limited liability company, governmental agency or any other entity.
"Receiving Party" shall mean any Party that receives or obtains
Confidential Information from a Disclosing Party.
"Salomon" shall have the meaning set forth in the Recitals.
"Salomon Fairness Opinion" shall have the meaning set forth in the
Recitals.
"SEC" shall mean the United States Securities and Exchange Commission.
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"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Senior Note Indenture" shall have the meaning set forth in the Recitals.
"Stock Incentive Plan" shall mean the 1995 Stock Incentive Plan of THCR.
"Subsidiary" shall mean, with respect to any Person, any other Person in
which such first Person, directly or indirectly, owns, controls or has the power
to vote a majority of the outstanding securities generally entitled to vote upon
the election of directors. For the purposes of this Agreement, the term
"Subsidiary" shall also include, with respect to THCR, THCR Holdings, Trump
Atlantic City Associates and Trump Plaza Associates.
"TC/GP" shall have the meaning set forth in the Preamble.
"TC/GP Common Stock" shall mean the Common Stock, par value $.01 per share,
of TC/GP.
"TC/GP Consideration" shall have the meaning set forth in Section 2.01.
"TCHI" shall have the meaning set forth in the Preamble.
"TCHI Common Stock" shall mean the Common Stock, without par value, of
TCHI.
"TCHI Consideration" shall have the meaning set forth in Section 2.01.
"TCHI Merger" shall have the meaning set forth in Section 2.01.
"THCR" shall have the meaning set forth in the Preamble.
"THCR Board" shall have the meaning set forth in the Recitals.
"THCR Class B Common Stock" shall mean the Class B Common Stock, par value
$.01 per share, of THCR.
"THCR Common Stock" shall have the meaning set forth in the Recitals.
"THCR Entities" shall have the meaning set forth in the Preamble.
"THCR Funding" shall have the meaning set forth in the Recitals.
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"THCR Holdings" shall have the meaning set forth in the Preamble.
"THCR Holdings Limited Partnership Interest" shall mean a limited
partnership interest of THCR Holdings issued pursuant to the THCR Holdings
Partnership Agreement and which is exchangeable into shares of THCR Common Stock
pursuant to the Exchange Rights Agreement.
"THCR Holdings Partnership Agreement" shall mean the Second Amended and
Restated Partnership Agreement, dated as of April 17, 1996, of THCR Holdings.
"THCR Indemnified Party" shall have the meaning set forth in Section 7.07.
"THCR/LP" shall mean THCR/LP Corporation, a New Jersey corporation wholly
owned by THCR.
"THCR Material Adverse Effect" shall mean a material adverse effect with
respect to the business, results of operations, properties, operations or
financial condition of THCR and its Subsidiaries, taken as a whole.
"THCR Meeting" shall have the meaning set forth in Section 6.03.
"THCR Proxy Statement" shall mean the proxy statement of THCR with respect
to the THCR Meeting.
"THCR SEC Reports" shall have the meaning set forth in Section 4.04.
"THCR Special Committee" shall have the meaning set forth in the Recitals.
"THCR Stock Contribution Value" shall have the meaning set forth in Section
2.01.
"THCR Stock Market Value" shall mean the average of the closing sale prices
on the NYSE of a share of THCR Common Stock for the twenty day trading period
ending three trading days immediately preceding the Closing Date, or any other
meaning as the Parties shall mutually agree.
"Trump" shall have the meaning set forth in the Preamble.
"Trump Casinos" shall mean Trump Casinos, Inc., a New Jersey corporation
wholly owned by Trump.
"Trump Consideration" shall have the meaning set forth in Section 2.01.
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"Trump Indemnified Party" shall have the meaning set forth in Section 7.07.
"Trump Warrants" shall mean the warrants to purchase 1,800,000 shares of
THCR Common Stock held by Trump of which (i) 600,000 shares may be purchased on
or before April 17, 1999 at $30.00 per share, (ii) 600,000 shares may be
purchased on or before April 17, 2000 at $35.00 per share and (iii) 600,000
shares may be purchased on or before April 17, 2001 at $40.00 per share.
ARTICLE II
THE CONTRIBUTION
Section 2.01. The Contribution; Consideration. (a) The aggregate
consideration payable hereunder for the Castle Equity shall be $176.9 million
(the "Castle Equity Consideration"), which amount represents: (A) $525.0 million
(a value for the business and operations of Castle Associates agreed by the
Parties as of the date hereof for purposes of the specific transactions
contemplated by this Agreement) MINUS (B) $314.0 million (the sum of all the
aggregate principal amounts of (i) Castle capital lease obligations and
indebtedness outstanding under the Midlantic Credit Agreement, (ii) Castle PIK
Notes not held by THCR Holdings, (iii) Castle Senior Notes and (iv) Castle
Mortgage Notes outstanding as of the date hereof) MINUS (C) $40.8 million (the
aggregate principal amount of all Castle PIK Notes held by THCR Holdings
estimated to be outstanding as of the Closing Date less the aggregate discount
at which Trump may repurchase the Castle PIK Notes held by THCR Holdings
pursuant to agreements entered into prior to the date hereof) PLUS (D) $6.7
million (the estimated amount of excess cash over the operating needs of Castle
Associates as of the Closing Date). On the terms and subject to the conditions
set forth in this Agreement, including, without limitation, paragraph (b) below,
and in reliance upon the Parties' representations set forth below, the
Contribution shall take place, and the Castle Equity Consideration shall be
payable, on the Closing Date (as defined below) as follows:
(i) Trump shall, on the Closing Date, contribute to THCR Holdings and THCR
Holdings shall accept as a contribution from Trump, the 61.5% limited
partnership interest in Castle Associates owned beneficially and of record by
Trump, in consideration of which Trump shall receive at the Closing a 9.52854%
THCR Holdings Limited Partnership Interest (the "Trump Consideration"),
exchangeable into 3,626,450 shares of THCR Common Stock (valuing each such share
at $30.00 per share (the "THCR Stock Contribution Value"));
(ii) TC/GP shall, on the Closing Date, contribute to THCR Holdings, and
THCR Holdings shall accept as a contribution from TC/GP, the 37.5% limited
partnership interest in Castle
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Associates owned beneficially and of record by TC/GP, in consideration of which
TC/GP shall receive at the Closing a 5.81009% THCR Holdings Limited Partnership
Interest (the "TC/GP Consideration"), exchangeable into 2,211,250 shares of THCR
Common Stock (valuing each such share at the THCR Stock Contribution Value);
(iii) the THCR Entities, Trump and TCHI shall, on the Closing Date, cause
Merger Sub 1.0 to be merged with and into TCHI in accordance with the NJBCA and
the DGCL, whereupon (x) the separate existence of Merger Sub 1.0 shall cease and
TCHI shall be the surviving corporation (the "TCHI Merger"), (y) at the
effective time of the TCHI Merger, (A) each share of TCHI Common Stock
outstanding immediately prior to the TCHI Merger shall be converted into the
right to receive $.8845 in cash (the "TCHI Consideration") and (B) each share of
common stock of Merger Sub 1.0 shall be converted into the right to receive one
share of common stock of the surviving corporation of the TCHI Merger and (z) a
provision shall be made for the Castle Warrantholders to receive, in accordance
with the terms of the Castle Warrant Agreement, for each former share of TCHI
Common Stock for which each Castle Warrant was exercisable immediately prior to
the effective time of the TCHI Merger, an amount in cash equal to the TCHI
Consideration (the "Castle Warrant Consideration"), to be delivered to the
Castle Warrant Agent on behalf of the Castle Warrantholders pursuant to the
terms of the Castle Warrant Agreement, representing the consideration that the
Castle Warrantholders are entitled to receive, as a result of the TCHI Merger,
pursuant to Section 7.2 of the Castle Warrant Agreement;
(iv) Trump, TC/GP and TCHI shall, simultaneously with the Contribution,
enter into an amendment to the Castle Associates Partnership Agreement, in order
to, among other things, convert Castle Associates from a general partnership to
a limited partnership, with TCHI as the sole general partner and Trump and TC/GP
as the limited partners; and
(v) THCR Holdings shall, immediately upon receipt of the 61.5% and 37.5%
limited partnership interests in Castle Associates from Trump and TC/GP,
respectively, contribute such limited partnership interests to Contribution Sub,
whereupon Contribution Sub will own a 99% limited partnership interest in Castle
Associates and the surviving corporation of the TCHI Merger will own a 1%
general partnership interest in Castle Associates.
(b) The Parties agree that if the THCR Stock Market Value is higher than
$38.00, then each of the Trump Consideration (and the number of shares of THCR
Common Stock into which it is exchangeable) and TC/GP Consideration (and the
number of shares of THCR Common Stock into which it is exchangeable) shall be
reduced appropriately as of the Closing Date so that no value will be received
by Trump or TC/GP in respect of any appreciation of the THCR Common Stock above
$38.00 per share.
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Section 2.02. Closing. (a) Unless this Agreement shall have been terminated
and the transactions herein contemplated shall have been abandoned pursuant to
Section 9.01, the closing of the Contribution (the "Closing") shall take place
as promptly as practicable (and in any event within two business days) after
satisfaction or waiver of the conditions set forth in Article VIII (the "Closing
Date"), at the offices of Willkie Farr & Gallagher, 153 East 53rd Street, New
York, New York, or at such other date, time and location as the Parties shall
mutually agree.
(b) The Contribution shall be effected on the Closing Date by execution and
delivery by the appropriate Parties of duly executed stock certificates,
partnership certificates or certificates of interest or assignment, as the case
may be, and by the delivery by the THCR Entities of the TCHI Consideration and
the Castle Warrant Consideration by wire transfer of immediately available funds
to such account as Trump and the Castle Entities, and the Castle Warrant Agent,
respectively, shall designate, or by any other method of payment as the Parties,
or the THCR Entities and the Castle Warrant Agent (in the case of the Castle
Warrant Consideration), shall mutually agree.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
TRUMP AND THE CASTLE ENTITIES
Trump and each of the Castle Entities represents and warrants to the THCR
Entities that:
Section 3.01. Corporate Organization. (a) TCHI is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New Jersey, and has all requisite corporate power and authority to own its
properties and assets and to conduct its businesses as now conducted. TCHI is
duly qualified and in good standing in each jurisdiction in which the property
owned, leased or operated by it makes such qualification necessary.
(b) TC/GP is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, and has all requisite
corporate power and authority to own its properties and assets and to conduct
its businesses as now conducted. TC/GP is duly qualified and in good standing in
each jurisdiction in which the property owned, leased or operated by it makes
such qualification necessary.
(c) Castle Associates is a general partnership validly existing under the
laws of the State of New Jersey, and has all
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requisite partnership power and authority to own its properties and assets and
to conduct its businesses as now conducted.
Section 3.02. Capitalization; Title. (a) The authorized capital stock of
TCHI consists of 2,500,000 shares of TCHI Common Stock. An aggregate of
1,000,000 shares of TCHI Common Stock are issued and outstanding. The
outstanding shares of TCHI Common Stock have been duly authorized and validly
issued and are fully paid, nonassessable and free of preemptive rights. The
outstanding shares of TCHI Common Stock are the sole outstanding capital stock
of TCHI. There are no options, warrants or other rights to purchase debt or
equity securities of TCHI outstanding, other than the Castle Warrants. Trump
owns all outstanding shares of TCHI Common Stock free and clear of any Liens,
except for Liens granted to certain of Trump's personal creditors as set forth
on a schedule previously delivered to the THCR Entities.
(b) Trump, TC/GP and TCHI own a 61.5%, 37.5% and 1% general partnership
interest, respectively, in Castle Associates, free and clear of any Liens,
except for Liens granted to certain of Trump's personal creditors as set forth
on a schedule previously delivered to the THCR Entities. Trump, TC/GP and TCHI
are the only partners of Castle Associates.
(c) Pursuant to the terms of the Castle Warrant Agreement, the Castle
Warrants entitle the Castle Warrantholders to purchase up to an aggregate of
1,000,000 shares of TCHI Common Stock, representing, in the aggregate, an
indirect interest in one-half of one percent (.5%) of the Castle Equity.
Section 3.03. Subsidiaries. TCHI and TC/GP have no Subsidiaries. Castle
Associates has no Subsidiaries other than Castle Funding. Castle Funding (i) is
a corporation duly organized, validly existing and in good standing under the
laws of the State of New Jersey and has all requisite corporate power and
authority to own its properties and conduct its business and operations as
currently conducted and (ii) is duly qualified and in good standing in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualification necessary, except where
the failure to be so qualified does not have and would not be reasonably
expected to have a Castle Material Adverse Effect.
Section 3.04. SEC Reports; Financial Statements. Trump has previously
furnished the THCR Entities with true and complete copies of the Castle
Associates and Castle Funding (i) Annual Report on Form 10-K for the fiscal year
ended December 31, 1995, as filed with the SEC, (ii) Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, as filed with the SEC, and (iii) all
other reports or registration statements filed with the SEC since January 1,
1996 through the date hereof (clauses (i) through (iii) being referred to herein
collectively as the "Castle SEC Reports"). As of their respective filing dates,
the Castle SEC Reports complied in all material respects with the
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requirements of the Securities Act or the Exchange Act, as the case may be. As
of their respective dates, the Castle SEC Reports, including, without
limitation, any financial statements included therein, did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The audited
consolidated financial statements and unaudited interim financial statements
included in the Castle SEC Reports comply as to form in all material respects
with applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto, have been prepared in accordance
with generally accepted accounting principles applied on a basis consistent with
prior periods (except as may be indicated therein or in the notes thereto),
present fairly the financial position of the entities to which they relate as of
the dates thereof and the results of their operations and cash flows for the
periods presented therein subject, in the case of the unaudited interim
financial statements, to normal year-end audit adjustments, any other
adjustments described therein and the fact that certain information and notes
have been condensed or omitted in accordance with the Securities Act or the
Exchange Act, as the case may be, and are, in all material respects, in
accordance with the books of account and records of Castle Associates and Castle
Funding.
Section 3.05. Absence of Certain Changes or Events. Except as described in
the Castle SEC Reports, during the period since March 31, 1996, (i) the business
of Castle Associates and Castle Funding has been conducted only in the ordinary
course, consistent with past practice, (ii) neither Castle Associates nor Castle
Funding has entered into any material transaction other than in the ordinary
course, consistent with past practice, and (iii) there has not been any event or
change that has had a Castle Material Adverse Effect.
Section 3.06. Authorization. (a) Trump has the capacity to carry out his
obligations hereunder and each of TC/GP and TCHI has the corporate power to
consummate the Contribution and the transactions contemplated thereby. The
execution and delivery of this Agreement, the performance of each of the
obligations hereunder and the consummation of the Contribution and the other
transactions contemplated thereby have been duly authorized and approved by all
necessary corporate action by each of the Board of Directors of TC/GP and TCHI.
Trump, as sole shareholder of TC/GP and TCHI, has approved the terms of the
Contribution and the other transactions contemplated thereby. This Agreement has
been duly executed and delivered by Trump and the Castle Entities and
constitutes the valid and binding obligation of Trump and the Castle Entities,
enforceable against them in accordance with its terms, except (i) to the extent
that enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or other laws affecting the enforcement of creditors' rights
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generally and (ii) that the availability of equitable remedies, including
specific performance, is subject to the discretion of the court before which any
proceeding therefor may be brought.
(b) No other corporate proceedings on the part of TC/GP and TCHI are
necessary to authorize the Contribution and the transactions contemplated
thereby.
Section 3.07. No Conflict or Violation. Assuming receipt of the consents
and approvals set forth in Section 3.08 of this Agreement, the execution,
delivery and performance by Trump and the Castle Entities of this Agreement and
the consummation of the Contribution and the transactions contemplated thereby
do not and will not violate or conflict with any provision of the charter
documents or by-laws of TC/GP, TCHI or Castle Funding or the Castle Associates
Partnership Agreement and do not and will not violate any provision of law, or
any order, judgment or decree of any court or other governmental or regulatory
authority, nor violate or result in a breach of or constitute (with due notice
or lapse of time or both) a default under any contract, lease, loan agreement,
mortgage, security agreement, trust indenture or other agreement or instrument
to which either Trump, TC/GP, TCHI, Castle Associates or Castle Funding is a
party or by which each is bound or to which each of their respective properties
or assets are subject, nor result in the creation or imposition of any lien,
charge or encumbrance of any kind whatsoever upon any of their properties or
assets, nor adversely affect or result in the cancellation, modification,
revocation or suspension of any of their licenses, franchises, permits,
authorizations or approvals issued or granted to them by the United States, any
state or local government, any foreign national or local government, or any
department, agency, board, commission, bureau or instrumentality of any of the
foregoing, except as would not be reasonably expected to have a Castle Material
Adverse Effect or as would not prevent consummation of the transactions
contemplated by the Contribution.
Section 3.08. Consents and Approvals. The execution, delivery and
performance of this Agreement by Trump, and the performance of the transactions
contemplated hereby by Trump and the Castle Entities, do not and will not
require any material consent, waiver, authorization or approval of any
governmental or regulatory authority, domestic or foreign, or of any other
Person (other than certain of Trump's personal creditors), and no material
declaration or notification to, or filing or registration with, or permit of,
any governmental or regulatory authority, except as it (i) may be required in
connection or compliance with applicable provisions of the DGCL, the NJBCA, the
Exchange Act, the Securities Act, the HSR Act, blue sky or other state
securities laws or Gaming Laws, (ii) may be required from certain creditors of
Castle Associates and Castle Funding in connection with the Contribution and the
transactions contemplated thereby, including, without limitation, the
modification of certain terms of the agreements to which such
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creditors are parties, (iii) would not be reasonably expected to have a Castle
Material Adverse Effect, (iv) would not prevent consummation of the transactions
contemplated by the Contribution or (v) is otherwise contemplated in this
Agreement.
Section 3.09. Litigation. Except as disclosed in the Castle SEC Reports,
there are no actions, suits, investigations or proceedings (adjudicatory,
rulemaking or otherwise) pending or, to the knowledge of Trump, threatened
against either TC/GP, TCHI, Castle Associates or Castle Funding, or any property
of theirs in any court or before any arbitrator of any kind or before or by any
governmental or regulatory authority, domestic or foreign, except actions,
suits, investigations or proceedings which, individually or in the aggregate, do
not have and would not be reasonably expected to result in a Castle Material
Adverse Effect.
Section 3.10. Taxes. TC/GP, TCHI, Castle Associates and Castle Funding have
filed all federal, state, county, local and foreign tax returns required to be
filed by them, and have paid all taxes shown to be due thereon, other than taxes
for which appropriate reserves have been made in their respective financial
statements (and, to the extent material, such reserves have been accurately
described to the THCR Entities). There are no assessments or adjustments that
have been asserted in writing against TC/GP, TCHI, Castle Associates or Castle
Funding for any period for which they have not made appropriate reserves in
their financial statements.
Section 3.11. Contracts and Leases. The Castle SEC Reports contain a
complete listing of all material contracts, leases, agreements or
understandings, whether written or oral, required to be described therein or
filed as exhibits thereto pursuant to the Securities Act or the Exchange Act, as
the case may be. Each of such contracts, leases, agreements and understandings
is in full force and effect and (i) none of Castle Associates or Castle Funding
or, to the best knowledge of Trump, any other party thereto, has breached or is
in default thereunder, (ii) no event has occurred which, with the passage of
time or the giving of notice would constitute such a breach or default, (iii) no
claim of material default thereunder has, to the best knowledge of Trump, been
asserted or threatened and (iv) none of Castle Associates or Castle Funding or,
to the best knowledge of Trump, any other party thereto is seeking the
renegotiation thereof or substitute performance thereunder, except where such
breach or default, or attempted renegotiation or substitute performance,
individually or in the aggregate, does not have and would not be reasonably
expected to have a Castle Material Adverse Effect.
Section 3.12. Compliance with Laws. (a) Castle Associates is not in
material violation of any laws, ordinances, governmental rules or regulations to
which it is subject, including, without limitation, Gaming Laws and laws or
regulations relating to the environment or to occupational health
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and safety, and no material expenditures are or will be required in order to
cause its current operations or properties to comply with any such laws,
ordinances, governmental rules or regulations.
(b) Castle Associates has all licenses, permits, franchises or other
governmental authorizations necessary to the ownership of its property or to the
conduct of its businesses, which if not obtained or, if the terms of which are
violated, might have a Castle Material Adverse Effect. Castle Associates has not
finally been denied any application for any such licenses, permits, franchises
or other governmental authorizations necessary to its business.
Section 3.13. Absence of Undisclosed Liabilities. Except as disclosed in
the Castle SEC Reports, neither Castle Associates nor Castle Funding has any
debt, obligation or liability (whether accrued, absolute, contingent, liquidated
or otherwise, whether due or to become due, whether or not known to Trump)
arising out of any transaction entered into at or prior to the Closing, or any
act or omission at or prior to the Closing, or any state of facts existing at or
prior to the Closing, including taxes with respect to or based upon the
transactions or events occurring at or prior to the Closing, and including,
without limitation, unfunded past service liabilities under any pension, profit
sharing or similar plan, except current liabilities incurred and obligations
under agreements entered into, in the usual and ordinary course of business,
none of which (individually or in the aggregate) could have a Castle Material
Adverse Effect.
Section 3.14. THCR Proxy Statement. None of the information supplied or to
be supplied by either Trump, TC/GP, TCHI, Castle Associates or Castle Funding
with respect to each of them for inclusion or incorporation by reference in the
THCR Proxy Statement will, at the time it is mailed, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading. If at any time
prior to the Closing any event with respect to either Trump, TC/GP, TCHI, Castle
Associates or Castle Funding, or their officers and directors, should occur
which is required to be described in an amendment of, or a supplement to, such
proxy statement, Trump shall promptly notify THCR thereof.
Section 3.15. Takeover Provisions Inapplicable. As of the date hereof and
at all times on or prior to the Closing, Section 203 of the DGCL is, and shall
be, inapplicable to the Castle Entities in connection with the Contribution and
the transactions contemplated thereby.
Section 3.16. Brokerage/Finder's Fees. No broker, finder or investment
banker is entitled to any brokerage, finder's or other fee or commission in
connection with the Contribution based
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upon arrangements made by or on behalf of either Trump or TC/GP, TCHI, Castle
Associates or Castle Funding.
ARTICLE IV
REPRESENTATIONS AND
WARRANTIES OF THE THCR
ENTITIES
Each of the THCR Entities represents and warrants to Trump and the Castle
Entities that:
Section 4.01. Corporate Organization. (a) THCR is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has all requisite corporate power and authority to own its
properties and assets and to conduct its businesses as now conducted. THCR is
duly qualified and in good standing in each jurisdiction in which the property
owned, leased or operated by it makes such qualification necessary, except where
the failure to be so qualified and in good standing would not be reasonably
expected to have a THCR Material Adverse Effect.
(b) THCR Holdings is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Delaware, and has all
requisite partnership power and authority to own its properties and assets and
to conduct its businesses as now conducted. THCR Holdings is duly qualified and
in good standing in each jurisdiction in which the property owned, leased or
operated by it makes such qualification necessary, except where the failure to
be so qualified and in good standing would not be reasonably expected to have a
THCR Material Adverse Effect.
Section 4.02. Capitalization. (a) The authorized capital stock of THCR
consists of 50,000,000 shares of THCR Common Stock, 1,000 shares of THCR Class B
Common Stock and 1,000,000 shares of Preferred Stock, par value $1.00 per share.
An aggregate of 24,140,090 and 1,000 shares of THCR Common Stock and THCR Class
B Common Stock, respectively, are issued and outstanding. All outstanding shares
of THCR Class B Common Stock are beneficially owned by Trump. The outstanding
shares of THCR Common Stock and THCR Class B Common Stock have been duly
authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights. The outstanding shares of THCR Common Stock and THCR Class B
Common Stock are the sole outstanding capital stock of THCR.
(b) THCR is the sole general partner of THCR Holdings. Trump, Trump Casinos
and THCR/LP are the only limited partners of THCR Holdings. THCR holds an
approximately 71% general partnership interest in THCR Holdings. Trump and Trump
Casinos hold in the aggregate an approximately 25% limited partnership interest
in THCR Holdings, which is exchangeable, at their
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option, into 8,081,023 shares of THCR Common Stock (subject to certain
adjustments set forth in the Exchange Rights Agreement). THCR/LP holds an
approximately 4% limited partnership interest in THCR Holdings. Assuming no
further equity issuances by THCR Holdings and no adjustments pursuant to Section
2.01(b) hereof, immediately after the Closing, (i) THCR shall hold an
approximately 60.0% general partnership interest in THCR Holdings, (ii) Trump,
Trump Casinos and TC/GP shall hold in the aggregate an approximately 36.6%
limited partnership interest in THCR Holdings, which shall be exchangeable, at
their option, into 13,918,723 shares of THCR Common Stock (subject to certain
adjustments set forth in the Exchange Rights Agreement) and (iii) THCR/LP shall
hold an approximately 3.4% limited partnership interest in THCR Holdings. Upon
the exchange of limited partnership interests for THCR Common Stock by Trump,
Trump Casinos or TC/GP, the interests in THCR Holdings held by THCR and any
subsidiary that is also a partner of THCR Holdings will effectively be increased
in the aggregate by an amount equal to such exchanged interests.
(c) THCR has authorized and reserved for issuance that number of shares of
THCR Common Stock (i) into which the THCR Holdings Limited Partnership Interests
held by Trump and Trump Casinos immediately prior to the consummation of the
Contribution are convertible, (ii) that underlie the Trump Warrants, (iii) that
are issuable pursuant to the Stock Incentive Plan and (iv) into which the THCR
Holdings Limited Partnership Interests to be issued to Trump and TC/GP pursuant
to Section 2.01 hereof are exchangeable. Upon conversion into THCR Common Stock
of the THCR Holdings Limited Partnership Interests to be issued to Trump and
TC/GP pursuant to Section 2.01 hereof, such shares of THCR Common Stock will be
validly issued, fully paid and non-assessable and their issuance will not be
subject to any preemptive or similar rights.
Section 4.03. Subsidiaries. Each Subsidiary of the THCR Entities (i) is a
corporation or other legal entity duly organized, validly existing and (if
applicable) in good standing under the laws of the jurisdiction of its
organization and has the full power and authority to own its properties and
conduct its business and operations as currently conducted, except where the
failure to be duly organized, validly existing or in good standing does not
have, and would not be reasonably expected to have, a THCR Material Adverse
Effect, and (ii) is duly qualified and in good standing in each jurisdiction in
which the property owned, leased or operated by it or the nature of the business
conducted by it makes such qualification necessary, except where the failure to
be so qualified does not have and would not be reasonably expected to have a
THCR Material Adverse Effect.
Section 4.04. SEC Reports; Financial Statements. The THCR Entities have
previously furnished Trump with true and complete copies of their respective (i)
Annual Report on Form 10-K for the fiscal year ended December 31, 1995, as filed
with the SEC, (ii)
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Quarterly Report on Form 10-Q for the quarter ended March 31, 1996, as filed
with the SEC, (iii) proxy statements relating to all meetings of stockholders
(whether annual or special) since January 1, 1996 and prior to the date hereof
and (iv) all other reports or registration statements filed with the SEC since
January 1, 1996 through the date hereof (clauses (i) through (iv) being referred
to herein collectively as the "THCR SEC Reports"). As of their respective filing
dates, the THCR SEC Reports complied in all material respects with the
requirements of the Securities Act or the Exchange Act, as the case may be. As
of their respective filing dates, the THCR SEC Reports, including, without
limitation, any financial statements included therein, did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The audited
consolidated financial statements and unaudited interim financial statements
included in the THCR SEC Reports comply as to form in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto, have been prepared in accordance with generally
accepted accounting principles applied on a basis consistent with prior periods
(except as may be indicated therein or in the notes thereto), present fairly the
financial position of the entities to which they relate as of the dates thereof
and the results of their operations and cash flows for the periods presented
therein subject, in the case of the unaudited interim financial statements, to
normal year-end audit adjustments, any other adjustments described therein and
the fact that certain information and notes have been condensed or omitted in
accordance with the Securities Act or the Exchange Act, as the case may be, and
are, in all material respects, in accordance with the books of account and
records of the THCR Entities.
Section 4.05. Absence of Certain Changes or Events. Except as described in
the THCR SEC Reports, during the period since March 31, 1996, (i) the business
of THCR and its Subsidiaries has been conducted only in the ordinary course,
consistent with past practice, (ii) neither THCR nor any of its Subsidiaries has
entered into any material transaction other than in the ordinary course,
consistent with past practice, and (iii) there has not been any change or event
that has had a THCR Material Adverse Effect.
Section 4.06. Authorization. (a) THCR and THCR Holdings have the corporate
and partnership power, respectively, to enter into this Agreement and to carry
out their obligations hereunder and, subject to the approval by the affirmative
vote of a majority of the outstanding shares of THCR Common Stock and THCR Class
B Common Stock, voting as a single class, have the power to consummate the
Contribution and the other transactions contemplated thereby. The execution and
delivery of this Agreement, the performance of THCR's obligations hereunder and
the consummation of the Contribution have been duly authorized by
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all necessary corporate action by the THCR Special Committee and the THCR Board.
Salomon has delivered to the THCR Special Committee the Salomon Fairness
Opinion, dated June 24, 1996, that the consideration to be paid by the THCR
Entities in the Contribution, is fair, from a financial point of view, to THCR.
The THCR Special Committee and the THCR Board have unanimously approved the
terms of the Contribution and this Agreement on behalf of THCR, in its own
capacity and as the sole general partner of THCR Holdings. This Agreement has
been duly executed and delivered by the THCR Entities and constitutes the valid
and binding obligation of the THCR Entities enforceable against them in
accordance with its terms, except (i) to the extent that enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally and (ii) that the
availability of equitable remedies, including specific performance, is subject
to the discretion of the court before which any proceeding therefor may be
brought.
(b) Except for the approval of the Contribution by the holders of THCR
Common Stock and THCR Class B Common Stock, no other corporate proceedings on
the part of the THCR Entities or their Subsidiaries are necessary to authorize
this Agreement and the transactions contemplated hereby.
Section 4.07. No Conflict or Violation. Assuming receipt of the consents
and approvals set forth in Section 4.08 of this Agreement, the execution,
delivery and performance by the THCR Entities of this Agreement, the
consummation of the Contribution and the transactions contemplated thereby, do
not and will not violate or conflict with any provision of the charter documents
or by-laws or partnership agreements, as the case may be, of the THCR Entities
or their Subsidiaries and do not and will not violate any provision of law, or
any order, judgment or decree of any court or other governmental or regulatory
authority, nor violate or result in a breach of or constitute (with due notice
or lapse of time or both) a default under any contract, lease, loan agreement,
mortgage, security agreement, trust indenture or other agreement or instrument
to which the THCR Entities or their Subsidiaries are a party or by which they
are bound or to which their respective properties or assets are subject, nor
result in the creation or imposition of any lien, charge or encumbrance of any
kind whatsoever upon any of the properties or assets of the THCR Entities or
their Subsidiaries, nor adversely affect or result in the cancellation,
modification, revocation or suspension of any of the licenses, franchises,
permits, authorizations or approvals issued or granted to the THCR Entities or
their Subsidiaries by the United States, any state or local government, any
foreign national or local government, or any department, agency, board,
commission, bureau or instrumentality of any of the foregoing, except as would
not be reasonably expected to have a THCR Material Adverse Effect or as would
not prevent consummation of the transactions contemplated by the Contribution.
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Section 4.08. Consents and Approvals. The execution, delivery and
performance of this Agreement by the THCR Entities do not and will not require
any material consent, waiver, authorization or approval of any governmental or
regulatory authority, domestic or foreign, or of any other Person (other than
the approval of the Contribution by the holders of the THCR Common Stock and
THCR Class B Common Stock), and no material declaration or notification to, or
filing or registration with, or permit of, any governmental or regulatory
authority, except as it (i) may be required in connection or compliance with
applicable provisions of the DGCL, the Exchange Act, the Securities Act, the HSR
Act, blue sky or other state securities laws or Gaming Laws, (ii) would not be
reasonably expected to have a THCR Material Adverse Effect, (iii) would not
prevent consummation of the transactions contemplated by the Contribution or
(iv) is otherwise contemplated in this Agreement.
4.09. Litigation. Except as disclosed in the THCR SEC Reports, there are no
actions, suits, investigations or proceedings (adjudicatory, rulemaking or
otherwise) pending or, to the knowledge of the THCR Entities, threatened against
the THCR Entities or any of their Subsidiaries, or any property of the THCR
Entities or any such Subsidiary in any court or before any arbitrator of any
kind or before or by any governmental or regulatory authority, domestic or
foreign, except actions, suits, investigations or proceedings which,
individually or in the aggregate, do not have and would not be reasonably
expected to result in a THCR Material Adverse Effect.
Section 4.10. Taxes. The THCR Entities and their Subsidiaries have filed
all federal, state, county, local and foreign tax returns required to be filed
by them, and have paid all taxes shown to be due thereon, other than taxes for
which appropriate reserves have been made in the financial statements of the
THCR Entities and their Subsidiaries (and, to the extent material, such reserves
have been accurately described to Trump). There are no assessments or
adjustments that have been asserted in writing against the THCR Entities or
their Subsidiaries for any period for which the THCR Entities or their
Subsidiaries have not made appropriate reserves in their financial statements.
Section 4.11. Contracts and Leases. The THCR SEC Reports contain a complete
listing of all material contracts, leases, agreements or understandings, whether
written or oral, required to be described therein or filed as exhibits thereto
pursuant to the Securities Act or the Exchange Act, as the case may be. Each of
such contracts, leases, agreements and understandings is in full force and
effect and (i) none of the THCR Entities or their Subsidiaries or, to the best
knowledge of the THCR Entities, any other party thereto, has breached or is in
default thereunder, (ii) no event has occurred which, with the passage of time
or the giving of notice would constitute such a breach or default, (iii) no
claim of material default thereunder has, to the best
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knowledge of the THCR Entities, been asserted or threatened and (iv) none of the
THCR Entities or their Subsidiaries or, to the best knowledge of the THCR
Entities, any other party thereto is seeking the renegotiation thereof or
substitute performance thereunder, except where such breach or default, or
attempted renegotiation or substitute performance, individually or in the
aggregate, does not have and would not be reasonably expected to have a THCR
Material Adverse Effect.
Section 4.12. Compliance with Laws. (a) Neither the THCR Entities nor their
Subsidiaries are in material violation of any laws, ordinances, governmental
rules or regulations to which they are subject, including, without limitation,
Gaming Laws and laws or regulations relating to the environment or to
occupational health and safety, and no material expenditures are or will be
required in order to cause their current operations or properties to comply with
any such laws, ordinances, governmental rules or regulations.
(b) The THCR Entities and their Subsidiaries have all licenses, permits,
franchises or other governmental authorizations necessary to the ownership of
their property or to the conduct of their businesses, which if not obtained or,
if the terms of which are violated, might have a THCR Material Adverse Effect.
Neither the THCR Entities nor their Subsidiaries have finally been denied any
application for any such licenses, permits, franchises or other governmental
authorizations necessary to their business.
Section 4.13. Absence of Undisclosed Liabilities. Except as disclosed in
the THCR SEC Reports, none of the THCR Entities has any debt, obligation or
liability (whether accrued, absolute, contingent, liquidated or otherwise,
whether due or to become due, whether or not known to the THCR Entities) arising
out of any transaction entered into at or prior to the Closing, or any act or
omission at or prior to the Closing, or any state of facts existing at or prior
to the Closing, including taxes with respect to or based upon the transactions
or events occurring at or prior to the Closing, and including, without
limitation, unfunded past service liabilities under any pension, profit sharing
or similar plan, except current liabilities incurred and obligations under
agreements entered into, in the usual and ordinary course of business, none of
which (individually or in the aggregate) could have a THCR Material Adverse
Effect.
Section 4.14. THCR Proxy Statement. None of the information supplied or to
be supplied by the THCR Entities with respect to the THCR Entities and their
Subsidiaries for inclusion or incorporation by reference in the THCR Proxy
Statement will, at the time it is mailed, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading. If at any time prior to
the Closing any event
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with respect to the THCR Entities or any of their Subsidiaries, or their
officers and directors, should occur which is required to be described in an
amendment of, or a supplement to, such proxy statement, the THCR Entities shall
notify Trump thereof.
Section 4.15. Takeover Provisions Inapplicable. As of the date hereof and
at all times on or prior to the Closing, Section 203 of the DGCL, is, and shall
be, inapplicable to the THCR Entities in connection with the Contribution and
the transactions contemplated thereby.
Section 4.16. Brokerage/Finder's Fees. Except for Salomon, no broker,
finder or investment banker is entitled to any brokerage, finder's or other fee
or commission in connection with the Contribution based upon arrangements made
by or on behalf of the THCR Entities or their Subsidiaries, and the fees and
commissions payable to Salomon, as contemplated by this Section, will be paid in
full by the THCR Entities.
ARTICLE V
COVENANTS OF TRUMP AND THE CASTLE ENTITIES
Section 5.01. Conduct Pending the Contribution. From and after the date of
this Agreement and until the Closing, Trump and the Castle Entities shall, and
shall cause Castle Associates and Castle Funding to, conduct their business
solely in the ordinary course consistent with past practice and Trump and the
Castle Entities shall, and shall cause Castle Associates and Castle Funding not
to, except with the prior written consent of the THCR Entities or as required or
permitted pursuant to the terms hereof or as contemplated in the Castle SEC
Reports filed through the date hereof or by the terms of the Contribution:
(i) make any material change in the conduct of their businesses and
operations or enter into any transaction, other than in the ordinary course of
business consistent with past practice;
(ii) make any change in their certificate of incorporation or by-laws or
partnership agreement, as the case may be, issue any additional shares of
capital stock or equity securities, grant any option, warrant or right to
acquire any capital stock or equity securities, issue any security convertible
into or exchangeable for their capital stock, alter in any material respect the
terms of any of their outstanding securities, or make any change in their
outstanding shares of capital stock or in their capitalization, whether by
reason of a reclassification, recapitalization, stock split or combination,
exchange or readjustment of shares, stock dividend or otherwise;
(iii) incur, assume or guarantee any indebtedness for borrowed money, issue
any notes, bonds, debentures or other
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corporate securities or grant any option, warrant or right to purchase any
thereof, other than in the ordinary course of business consistent with past
practice;
(iv) make any sale, assignment, transfer, abandonment or other conveyance
of any of their assets or any part thereof, except in the ordinary course of
business consistent with past practices;
(v) subject any of their assets, or any part thereof, to any lien or suffer
such to be imposed other than such liens as may arise in the ordinary course of
business consistent with past practice or by operation of law;
(vi) redeem, retire, purchase or otherwise acquire, directly or indirectly,
any shares of their capital stock or declare, set aside or pay any dividends or
make any other distribution in respect of such shares or make any other
distributions in respect of equity interests;
(vii) increase the compensation payable or to become payable to their
executive officers or employees, except for increases in the ordinary course of
business in accordance with past practices, or grant any severance or
termination pay to, or enter into any employment or severance agreement (other
than in the ordinary course of business) with, any director or executive
officer, or establish, adopt, enter into or amend in any material respect or
take action to accelerate any rights or benefits under any collective
bargaining, bonus, profit sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, deferred compensation, employment,
termination, severance or other plan, agreement, trust fund, policy or
arrangement for the benefit of any director, executive officer or employee;
(viii) take any other action that would cause any of the representations
and warranties made in this Agreement not to remain true and correct; or
(ix) commit themselves to do any of the foregoing.
Section 5.02. No Solicitation. Neither Trump nor the Castle Entities shall,
directly or indirectly, take (nor shall any of them authorize or permit Castle
Associates or Castle Funding, or their officers, directors, employees,
representatives, investment bankers, attorneys, accountants or other agents or
affiliates, to take) any action (i) to knowingly encourage, solicit or initiate
the submission of any Acquisition Proposal, (ii) to enter into any agreement
with respect to any Acquisition Proposal or (iii) to participate in any way in
discussions or negotiations with, or furnish any information to, any Person in
connection with, or take any other action to facilitate any inquiries or the
making of any proposal that constitutes, or may reasonably be expected to lead
to, any
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Acquisition Proposal. Notwithstanding the foregoing, the Parties agree that in
the event Trump or TCHI receives an unsolicited Acquisition Proposal by any
other Person relating to a transaction involving the sale of the TCHI Common
Stock or any merger, consolidation or other business combination or acquisition
of all or substantially all of the assets or securities of TCHI, Trump or TCHI,
as the case may be, may review and act upon such unsolicited Acquisition
Proposal solely as it relates to such transaction only in the event that Trump
and/or TCHI, as the case may be, determines in good faith, after consultation
with and based upon the advice of his and/or its financial and legal advisors,
that failing to review and act upon such proposal would constitute a breach of
fiduciary duty. Trump will promptly communicate to the THCR Entities any
solicitation by or of TC/GP, TCHI, Castle Associates or Castle Funding and the
terms of any proposal or inquiry, including the identity of the Person and its
affiliates making the same, that it may receive in respect of any such
transaction, or of any such information requested from it or of any such
negotiations or discussions being sought to be initiated with it. Prior to the
date hereof, Trump and the Castle Entities shall have delivered to the THCR
Entities all written materials relating to all Acquisition Proposals received by
Trump and the Castle Entities from January 1, 1995 through the date hereof, if
any.
Section 5.03. Letters of Accountants. Trump shall use his reasonable best
efforts to cause to be delivered to the THCR Entities "comfort letters" of
Arthur Andersen LLP, the Castle Associates' independent public accountants,
dated and delivered the date on which the THCR Proxy Statement is mailed and as
of the Closing Date, and addressed to the THCR Special Committee and the THCR
Board, in form and substance reasonably satisfactory to the THCR Entities and
reasonably customary in scope and substance for letters delivered by independent
public accountants in connection with transactions such as those contemplated by
this Agreement.
ARTICLE VI
COVENANTS OF THE THCR ENTITIES
Section 6.01. Conduct Pending the Contribution. From and after the date of
this Agreement and until the Closing, the THCR Entities shall, and shall cause
each of their Subsidiaries to, conduct their business solely in the ordinary
course consistent with past practice and, without the prior written consent of
Trump and the Castle Entities, the THCR Entities shall not, and shall cause each
of their Subsidiaries not to, except as required or permitted pursuant to the
terms hereof or as contemplated in the THCR SEC Reports filed through the date
hereof or by the terms of the Contribution:
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(i) make any material change in the conduct of their businesses and
operations or enter into any transaction other than in the ordinary course of
business consistent with past practice;
(ii) make any change in its certificate of incorporation or by-laws or
partnership agreement, as the case may be, or make any material change in their
outstanding shares of capital stock or in their capitalization, whether by
reason of a reclassification, recapitalization, stock split or combination,
exchange or readjustment of shares, stock dividend or otherwise;
(iii) redeem, retire, purchase or otherwise acquire, directly or
indirectly, any shares of their capital stock or declare, set aside or pay any
dividends or make any other distribution in respect of such shares or make any
other distributions in respect of equity interests;
(iv) take any other action that would cause any of the representations and
warranties made in this Agreement not to remain true and correct; or
(v) commit themselves to do any of the foregoing.
6.02. THCR Proxy Statement. (a) As promptly as reasonably practicable after
the execution of this Agreement, THCR shall prepare and file with the SEC the
preliminary THCR Proxy Statement. As promptly as reasonably practicable after
comments are received from the SEC with respect to the THCR Proxy Statement and
after the satisfactory response thereto by THCR, THCR shall file with the SEC
the definitive THCR Proxy Statement. Thereafter, THCR shall distribute the
definitive THCR Proxy Statement and related proxy card to its stockholders. THCR
shall cause the THCR Proxy Statement to comply as to form in all material
respects with the provisions of the Exchange Act.
Section 6.03. Stockholders Meeting. THCR shall take all action necessary,
in accordance with applicable law and its certificate of incorporation and
by-laws, to convene a special meeting of the holders of the THCR Common Stock
and the THCR Class B Common Stock (the "THCR Meeting") as promptly as
practicable for the purpose of approving the Contribution. Subject to its
fiduciary duties, as advised by outside counsel, the THCR Board will recommend
that holders of THCR Common Stock vote in favor of and approve the Contribution
at the THCR Meeting.
ARTICLE VII
OTHER AGREEMENTS
Section 7.01. Registration Rights; Partnership Agreement. (a) THCR and
Trump agree to amend the Exchange Rights Agreement to afford Trump the
registration rights and exchange privileges
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contained in the Exchange Rights Agreement with respect to the THCR Holdings
Limited Partnership Interests that Trump and TC/GP shall receive pursuant to
Section 2.01 hereof.
(b) THCR and Trump shall, and shall cause the other limited partners of
THCR Holdings to, amend the THCR Holdings Partnership Agreement or to waive any
provisions thereof as shall be necessary to effect the transactions contemplated
by this Agreement.
Section 7.02. Additional Agreements; Consents. Subject to the terms and
conditions herein provided, each of the Parties agrees, and Trump agrees to
cause each of TC/GP, TCHI, Castle Associates and Castle Funding to agree, to use
all reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary, proper or advisable under applicable
laws and regulations to consummate and make effective the transactions
contemplated by the Contribution, including using all reasonable efforts to
obtain all necessary waivers, consents and approvals, to effect all necessary
registrations and filings (including, but not limited to, filings with all
applicable governmental agencies) and to lift any injunction or other legal bar
to the transactions contemplated by this Agreement (and, in such case, to
proceed with the transactions contemplated by this Agreement as expeditiously as
possible).
Section 7.03. Access to Information; Confidentiality. (a) Each of the
Parties shall, and Trump and the Castle Entities shall cause each of Castle
Associates and Castle Funding to, afford to the other Parties and to their
accountants, counsel and other representatives full access during normal
business hours (and at such other times as the Parties may mutually agree)
throughout the period until the Closing to all of its properties, books,
contracts, commitments, records and personnel and, during such period, each
shall furnish promptly to the others (i) a copy of each report, schedule and
other document filed or received by it pursuant to the requirements of federal
or state securities laws or Gaming Laws and (ii) all other information
concerning its business, properties and personnel, both past and present, as
such party may reasonably request.
(b) A Receiving Party shall (i) keep confidential and not disclose or
reveal to any Person, other than those employed by the Receiving Party or acting
on the Receiving Party's behalf and directly participating in the performance of
such party's obligations under this Agreement, all Confidential Information,
(ii) cause their respective affiliates and the directors, officers, employees,
agents, advisors and controlled or controlling Persons of such party and its
affiliates to observe the terms of this Section and to keep confidential and not
disclose or reveal to any Person all Confidential Information and (iii) not use
Confidential Information for any purpose other than in connection with the
transactions contemplated by this Agreement and in a manner approved by the
Disclosing Party.
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(c) In the event that a Receiving Party is requested or required by
interrogatories, requests for information or documents, subpoena, civil
investigative demand or similar process or required (as advised in writing by
its outside counsel) to disclose any of the Confidential Information, the
Receiving Party shall provide the Disclosing Party with prompt written notice so
that it may seek a protective order or other appropriate remedy. In the event
such protection or other remedy is not obtained, the Receiving Party may
disclose such Confidential Information pursuant to such interrogatories,
requests for information or documents, subpoena, civil investigative demand or
similar process or other law; provided, however, that the Receiving Party shall
exercise best efforts to obtain assurance that confidential treatment will be
accorded to such Confidential Information.
(d) Without prejudice to the rights and remedies otherwise available to a
Disclosing Party, a Disclosing Party shall be entitled to equitable relief by
way of injunction if the Receiving Party or any of the Receiving Party's
affiliates and the directors, officers, employees, agents, advisors and
controlled or controlling Persons of such Receiving Party and its affiliates
breach or threaten to breach any of the provisions of this Section.
Section 7.04. Notification of Certain Matters. Trump and the THCR Entities
shall give prompt notice to each other of:
(i) any notice or other communication from any Person alleging that the
consent of such Person is or may be required in connection with the transactions
contemplated by this Agreement;
(ii) any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by this
Agreement;
(iii) any action, suit, claim, investigation or proceeding commenced or, to
its knowledge, threatened against, relating to or involving or otherwise
affecting Trump, TC/GP, TCHI, Castle Associates or Castle Funding and the THCR
Entities or any of their Subsidiaries, which is reasonably likely to have a
Castle Material Adverse Effect (in the case of Trump, TC/GP, TCHI, Castle
Associates or Castle Funding) or a THCR Material Adverse Effect (in the case of
the THCR Entities or their Subsidiaries) or prevent the consummation of the
transactions contemplated by this Agreement or cause any of such transactions to
be rescinded following consummation;
(iv) the occurrence, or failure to occur, of any event or change in
circumstances where such occurrence or failure to occur would be likely to cause
any representation or warranty contained in this Agreement to be untrue or
inaccurate in any material respect at any time from the date hereof to the
Closing Date; and
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(v) any material failure of such party to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that no such notification shall affect the
representations or warranties of the parties or the conditions to the
obligations of the parties hereunder.
Section 7.05. HSR Act. The Parties shall, and Trump and the Castle Entities
shall cause Castle Associates and Castle Funding to, use their respective best
efforts to file or cause to be filed as soon as practicable all the required
notifications under the HSR Act in connection with the Contribution, and to
respond as promptly as practicable to any inquiries received from the Federal
Trade Commission and the Antitrust Division of the Department of Justice for
additional information or documentation and to respond as promptly as
practicable to all inquiries and requests received from any State Attorney
General or other governmental authority in connection with antitrust matters.
Section 7.06. Merger Agreement. To the extent required under the DGCL,
NJBCA or any other applicable state law relating to mergers, TCHI shall, and
THCR and THCR Holdings shall cause Merger Sub 1.0 to, enter into a plan of
merger in order to effect the TCHI Merger on the terms set forth in Section 2.01
of this Agreement.
Section 7.07. Indemnification. (a) Trump and the Castle Entities hereby
agree, and agree to cause Castle Associates and Castle Funding to, indemnify the
THCR Entities and each of their officers, directors, partners, controlling
persons, affiliates, agents and employees (other than Trump), and their
respective heirs, successors and assigns (each a "THCR Indemnified Party"),
against any losses, claims, damages, expenses (including the reasonable fees and
expenses of their respective attorneys), liabilities, actions, proceedings,
investigations (formal or informal), inquiries or threats thereof (collectively,
the "Liabilities") to which a THCR Indemnified Party may become subject to and
arising in any matter out of or in connection with (i) any breach of any
representation or warranty made by Trump or the Castle Entities in this
Agreement and (ii) any breach of any covenant or agreement of Trump or the
Castle Entities in this Agreement.
(b) The THCR Entities hereby agree to indemnify Trump and his heirs,
successors and assigns (each a "Trump Indemnified Party" and collectively with a
THCR Indemnified Party, an "Indemnified Party") against any Liabilities to which
a Trump Indemnified Party may become subject to and arising in any matter out of
or in connection with (i) any breach of any representation or warranty made by
the THCR Entities in this Agreement and (ii) any breach of any covenant or
agreement of the THCR Entities in this Agreement.
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(c) Each Indemnified Party shall give notice to the Party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom; provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or any
litigation resulting therefrom, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld) and the Indemnified Party
may participate in such defense at such party's expense (unless the Indemnified
Party shall have reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in such action, in
which case the fees and expenses of counsel shall be at the expense of the
Indemnifying Party); and provided further that the failure of any Indemnified
Party to give notice as provided herein shall not relieve the Indemnifying Party
of its obligations under this Section, unless the Indemnifying Party is
materially prejudiced thereby. No Indemnifying Party, in the defense of any such
claim or litigation shall, except with the consent of each Indemnified Party
(which consent shall not unreasonably be withheld), consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a full and unconditional release from all liability in respect to such claim
or litigation. Each Indemnified Party shall furnish such information regarding
itself or the claim in question as an Indemnifying Party may reasonably request
in writing and as shall be reasonably required in connection with the defense of
such claim and litigation resulting therefrom.
Section 7.08. Voting Agreement. Trump, the beneficial owner of all the
outstanding shares of THCR Class B Common Stock, hereby agrees to vote or cause
to be voted at the THCR Meeting all of such shares and any shares of THCR Common
Stock that he beneficially owns, for approval of the Contribution, which
approval will include the approval and adoption of this Agreement.
ARTICLE VIII
CONDITIONS TO THE CONTRIBUTION
Section 8.01. Conditions of Each Party. The respective obligations of the
THCR Entities and Trump and the Castle Entities to consummate the transactions
contemplated by this Agreement are subject to the fulfillment, at or prior to
the Closing, of each of the following conditions, any or all of which may be
waived in whole or in part, to the extent permitted by applicable law:
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(i) the Contribution shall have been duly approved and adopted by the
affirmative vote of a majority of the outstanding shares of THCR Common Stock
and THCR Class B Common Stock, voting as a single class, in accordance with the
DGCL and the certificate of incorporation of THCR;
(ii) the Contribution shall have been duly approved by the affirmative vote
of a majority of the outstanding shares of THCR Common Stock (excluding shares
held by officers and directors of THCR and their affiliates);
(iii) the consent of certain of Trump's personal creditors necessary to
consummate the Contribution and the transactions contemplated thereby shall have
been obtained, and all Liens in favor of any such creditors on the Castle Equity
shall have been released;
(iv) all filings required to be made prior to the Closing with, and all
consents, approvals, permits and authorizations required to be obtained prior to
the Closing from any governmental and regulatory authorities (including, without
limitation, Gaming Authorities) in connection with the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby
shall have been made or obtained (as the case may be) without restrictions,
except where the failure to obtain such consents, approvals, permits and
authorizations could not be reasonably be expected to have a Castle Material
Adverse Effect or a THCR Material Adverse Effect, as the case may be;
(v) no court or governmental or regulatory authority of competent
jurisdiction (including, without limitation, Gaming Authorities) shall have
enacted, issued, promulgated, enforced or entered any statute, rule, regulation,
judgment, decree, injunction or other order (whether temporary, preliminary or
permanent) or taken any action that prohibits the consummation of the
transactions contemplated by this Agreement; provided, however, that the parties
invoking this condition shall use their best efforts to have any such judgment,
decree, injunction or order vacated; and
(vi) the waiting period applicable to the consummation of the Contribution
under the HSR Act shall have expired or been terminated.
Section 8.02. Conditions of Trump. The obligations of Trump and the Castle
Entities to consummate the transactions contemplated by this Agreement are
subject to the fulfillment, at or prior to the Closing, of each of the following
conditions, any or all of which may be waived in whole or in part by Trump and
the Castle Entities to the extent permitted by applicable law:
30
<PAGE>
(i) each of the THCR Entities shall have performed in all material respects
all of its respective obligations hereunder required to be performed by it at or
prior to the Closing;
(ii) each of the representations and warranties of the THCR Entities
contained in this Agreement and in any certificate or other writing delivered by
the THCR Entities pursuant hereto shall be true in all material respects at and
as of the Closing Date as if made at and as of such time (except to the extent
it relates to a particular date); and
(iii) Trump shall have received a certificate from THCR, in its own
capacity and as the sole general partner of THCR Holdings, signed by an
executive officer of THCR, to the effect set forth in clauses (i) and (ii) of
this Section.
Section 8.03. Conditions of the THCR Entities. The obligation of the THCR
Entities to consummate the transactions contemplated by this Agreement is
subject to the fulfillment, at or prior to the Closing, of each of the following
conditions, any or all of which may be waived in whole or in part by the THCR
Entities to the extent permitted by applicable law:
(i) Castle Associates shall have been converted into a limited partnership
and the Castle Associates Partnership Agreement shall have been amended in form
and substance satisfactory to the THCR Entities;
(ii) TCHI shall have complied with Section 7.2 of the Castle Warrant
Agreement and all other relevant provisions thereof and the Castle Warrants
shall have been canceled or appropriate provision shall have been made therefor;
(iii) the consent of certain creditors of Castle Associates and Castle
Funding to modify certain terms of the agreements to which such creditors are
parties (in form and substance satisfactory to the THCR Entities) shall have
been obtained;
(iv) Trump and the Castle Entities shall have performed, and shall have
caused Castle Associates and Castle Funding to perform, in all material respects
all of their obligations hereunder required to be performed by them at or prior
to the Closing;
(v) each of the representations and warranties of Trump and the Castle
Entities contained in this Agreement and in any certificate or other writing
delivered by Trump and the Castle Entities pursuant hereto shall be true in all
material respects at and as of the Closing Date as if made at and as of such
time (except to the extent it relates to a particular date); and
(vi) the THCR Entities shall have received a certificate signed by Trump
and the Castle Entities to the effect set forth in clauses (iv) and (v) of this
Section.
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ARTICLE IX
TERMINATION
Section 9.01. Termination. This Agreement may be terminated and the
Contribution may be abandoned at any time prior to the Closing (whether before
or after approval of this Agreement by the stockholders of THCR):
(i) by joint written consent of Trump, the Castle Entities and the THCR
Entities;
(ii) by Trump and the Castle Entities if any of the conditions specified in
Sections 8.01 or 8.02 have not been satisfied or waived by Trump or the Castle
Entities at such time as such condition is no longer capable of satisfaction;
(iii) by Trump or TCHI, as the case may be, to act upon an unsolicited
Acquisition Proposal as set forth in Section 5.02 hereof;
(iv) by the THCR Entities if any of the conditions specified in Sections
8.01 or 8.03 have not been satisfied or waived by the THCR Entities at such time
as such condition is no longer capable of satisfaction; or
(v) by any Party if the Contribution has not been consummated on or before
December 31, 1996; provided, however, that a party may not terminate this
Agreement pursuant to this clause if the failure of such party to fulfill any of
its obligations under this Agreement shall have been the reason that the
Contribution shall not have been consummated on or before said date.
Section 9.02. Effect of Termination. In the event of termination of this
Agreement pursuant to this Article, this Agreement shall forthwith terminate and
(except for the willful breach of this Agreement by any Party) there shall be no
liability on the part of any Party; provided, however, that Sections 3.16, 4.16,
7.03 (b), (c) and (d), 9.02, 10.01, 10.05, 10.06, 10.07, 10.09, 10.11 and 10.13
and the last sentence of Section 10.03 shall survive the termination of this
Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.01. Notices. All notices, requests and other communications to
any Party hereunder shall be in writing (including facsimile or similar writing)
and shall be given:
(i) if to Trump and the Castle Entities to:
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Donald J. Trump
725 Fifth Avenue
New York, New York 10022
Facsimile: (212) 755-3230
with copies to:
Andrews & Kurth L.L.P.
425 Lexington Avenue
New York, New York 10017
Facsimile: (212) 850-2800
Attention: Emanuel S. Cherney, Esq.
(ii) if to the THCR Entities to:
Trump Hotels & Casino Resorts, Inc.
Mississippi Avenue and The Boardwalk
Atlantic City, New Jersey 08401
Facsimile: (609) 441-7926
Attention: Robert M. Pickus, Esq.
with copies to:
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, New York 10022
Facsimile: (212) 821-8111
Attention: Daniel D. Rubino, Esq.
or such other address or facsimile number as such Party may hereafter specify by
notice to the other Parties. Each such notice, request or other communication
shall be effective (i) if given by facsimile, when such facsimile is transmitted
to the facsimile number specified in this Section and the appropriate
confirmation is provided, (ii) if given via United States mail, three days after
such notice is deposited in the mail in a postage pre-paid envelope or (iii) if
given by any other means, when delivered at the address specified in this
Section.
Section 10.02. Survival. All the representations, warranties, agreements or
covenants contained herein shall survive the Closing Date for a period of two
years.
Section 10.03. Amendment. Any provision of this Agreement may be amended by
the Parties at any time prior to the Closing, provided that any such amendment
made after the approval of the Contribution by the stockholders of THCR shall
not, without further approval of such stockholders, (i) alter or change the
amount, kind or manner of payment of the consideration to be received or (ii)
change any other terms or conditions of this Agreement, if any of such changes,
alone or in the aggregate, would materially and adversely affect the
stockholders of THCR.
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Any amendment to this Agreement shall be in writing signed by all the
Parties.
Section 10.04. Waiver. At any time prior to the Closing, the Parties may,
unless otherwise set forth in this Agreement, (i) extend the time for the
performance of any agreement of the other Party or Parties, (ii) waive any
inaccuracy in the representations and warranties contained herein or in any
document delivered pursuant hereto or (iii) waive compliance with any agreement
or condition of the other Party or Parties contained herein. Any agreement on
the part of any Party to any such extension or waiver shall be effective only if
set forth in a writing signed on behalf of such Party and delivered to the other
Party or Parties. No failure or delay by any Party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other right, power or privilege.
Section 10.05. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the Parties and their
respective successors and assigns; provided, however, that no Party may assign
or otherwise transfer any of its rights under this Agreement without the consent
of each of the other Parties.
Section 10.06. Governing Law. Except to the extent set forth in Section
10.07 or in the DGCL, this Agreement shall be construed in accordance with and
governed by the internal laws of the State of New York without regard to
principles of conflict of laws.
Section 10.07. Gaming Laws. Each of the provisions of this Agreement is
subject to and shall be enforced in compliance with the Gaming Laws.
Section 10.08. Integration. This Agreement embodies the entire agreement
and understanding among the Parties and supersedes all prior agreements and
understandings relating to the subject matter hereof.
Section 10.09. Third Party Beneficiaries. Except as otherwise provided
herein, this Agreement (including the documents and instruments referred to
herein) is not intended to confer upon any other Person any rights or remedies
hereunder.
Section 10.10. Specific Performance. The Parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the Parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of the United States
or any state having jurisdiction,
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this being in addition to any other remedy to which they are entitled at law or
in equity.
Section 10.11. Remedies Cumulative. All rights, powers and remedies
provided under this Agreement otherwise available at law or in equity shall be
cumulative and not alternative, and the exercise or beginning of any thereof by
any Party shall not preclude the simultaneous or later exercise of any other
such right, power or remedy by such Party.
Section 10.12. Publicity. So long as this Agreement is in effect, each of
the Parties agrees to consult with each other in issuing any press release or
otherwise making any public statement with respect to the Contribution, and none
of them shall issue any press release or make any public statement prior to such
consultation, except as may be required by law or by obligations pursuant to any
listing agreement with any national securities exchange. The commencement of
litigation relating to this Agreement or any proceedings in connection therewith
shall not be deemed a violation of this Section.
Section 10.13. Fees and Expenses. Whether or not the Contribution is
consummated, (i) any costs and expenses incurred by a Party in connection with
the Contribution and the transactions contemplated thereby shall be borne in
full by such Party and (ii) Trump and the Castle Entities shall cause each of
Castle Associates and Castle Funding to pay for their own costs and expenses
incurred in connection with the Contribution and the transactions contemplated
thereby.
Section 10.14. Headings; Counterparts; Effectiveness. The headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each Party shall have
received counterparts hereof signed by the other Parties.
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<PAGE>
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
TRUMP HOTELS & CASINO RESORTS, INC.
/S/ NICHOLAS L. RIBIS
--------------------------------------
By: Nicholas L. Ribis
Title: President and Chief
Executive Officer
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
By: Trump Hotels & Casino Resorts, Inc.,
as general partner
/S/ NICHOLAS L. RIBIS
--------------------------------------
By: Nicholas L. Ribis
Title: President and Chief
Executive Officer
TC/GP, INC.
/S/ DONALD J. TRUMP
--------------------------------------
By: Donald J. Trump
Title: President
TRUMP'S CASTLE HOTEL & CASINO, INC.
/S/ NICHOLAS L. RIBIS
--------------------------------------
By: Nicholas L. Ribis
Title: Vice President and Assistant
Secretary
/S/ DONALD J. TRUMP
--------------------------------------
Donald J. Trump
36
<PAGE>
TRUMP HOTELS & CASINO RESORTS, INC.
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
2500 Boardwalk
Atlantic City, New Jersey 08401
August 27, 1996
TC/GP, INC.
One Castle Boulevard
Atlantic City, New Jersey 08401
TRUMP'S CASTLE HOTEL & CASINO, INC.
One Castle Boulevard
Atlantic City, New Jersey 08401
DONALD J. TRUMP
725 Fifth Avenue
New York, New York 10022
Dear Sirs:
This letter will confirm our agreement to modify the terms of that certain
Agreement, dated June 24, 1996, by and among Trump Hotels & Casino Resorts,
Inc., Trump Hotels & Casino Resorts Holdings, L.P., TC/GP, Inc., Trump's Castle
Hotel & Casino, Inc. and Donald J. Trump (the "Agreement"). Capitalized terms
not otherwise defined herein shall have the same meanings as ascribed to them in
the Agreement.
Notwithstanding anything to the contrary in the Agreement, the Agreement is
hereby modified as follows:
1. The Castle Associates Partnership Agreement shall be amended, on or
prior to the date of the Contribution, to convert Castle Associates into a
limited partnership in which (i) Trump, TC/GP and TCHI will remain as general
partners each with a 1% partnership interest in Castle Associates and (ii) Trump
and TC/GP shall become limited partners with a 60.5% and a 36.5% partnership
interest in Castle Associates, respectively.
2. The Castle Associates Partnership Agreement shall be again amended to
reflect that, simultaneously with the Contribution, Trump and TC/GP shall have
converted each of their 1% general partnership interests into limited
partnership interests and shall have assigned a 61.5% and a 37.5% limited
partnership interest, respectively, to THCR Holdings.
3. Upon consummation of the Contribution, Castle Associates shall be a
limited partnership with THCR Holdings as a 99% limited partner and TCHI (as the
surviving corporation of the TCHI Merger) as a 1% general partner.
Except to the extent necessary to implement the changes set forth herein,
the Agreement shall remain unmodified and in full force and effect. This letter
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument.
<PAGE>
If the foregoing correctly sets forth the understanding and agreement
between the Parties, please sign below and return one original executed copy of
this letter.
Very truly yours,
TRUMP HOTELS & CASINO RESORTS, INC.
By: /S/ NICHOLAS L. RIBIS
--------------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
By: Trump Hotels & Casino Resorts, Inc.,
as general partner
By: /S/ NICHOLAS L. RIBIS
--------------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
Confirmed and Agreed as of the date first written above:
TC/GP, INC.
By: /S/ DONALD J. TRUMP
--------------------------------------------
Name: Donald. J. Trump
Title: President
TRUMP'S CASTLE HOTEL & CASINO, INC.
By: /S/ NICHOLAS L. RIBIS
--------------------------------------------
Name: Nicholas L. Ribis
Title: Vice President and Assistant
Secretary
/S/ DONALD J. TRUMP
--------------------------------------------
Donald J. Trump
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