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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. 1)*
TRUMP HOTELS & CASINO RESORTS, INC.
- --------------------------------------------------------------------------------
(Name of Issuer)
COMMON STOCK
- --------------------------------------------------------------------------------
(Title of Class of Securities)
898168109
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(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)
April 17, 1996
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(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 13d-1(b)(3) or (4), check the following box [_].
Check the following box if a fee is being paid with the statement [_] (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 13d-7.)
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-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).
<PAGE>
SCHEDULE 13D
CUSIP No. 898168109 Page 2 of Pages
------------------ -- --
- --------------------------------------------------------------------------------
1 NAME OF REPORT PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Donald J. Trump
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [_]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [_]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7 SOLE VOTING POWER
8,474,256
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8 SHARED VOTING POWER
1,407,292
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9 SOLE DISPOSITIVE POWER
8,474,256
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10 SHARED DISPOSITIVE POWER
1,407,292
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
9,881,548
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [_]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
29.0%
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14 TYPE OF REPORTING PERSON*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7 2 of 7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP No. 898168109 Page 3 of Pages
------------------ -- --
- --------------------------------------------------------------------------------
1 NAME OF REPORT PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Trump Casinos, Inc.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [_]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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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
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7 SOLE VOTING POWER
0
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8 SHARED VOTING POWER
1,407,017
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9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
1,407,017
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
1,407,017
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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 2 of 7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Page 4
This Amendment No. 1 amends and restates the Schedule 13D dated June 22, 1995
filed by Mr. Donald J. Trump ("Mr. Trump"), and is being filed pursuant to Rule
13d-2(a), (c) under the Securities Exchange Act of 1934 (the "Exchange Act").
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 Mississippi Avenue and The Boardwalk, Atlantic
City, New Jersey 08401.
Item 2. Identity and Background.
-----------------------
(a)-(c), (f). This Statement is being filed by Mr. Trump and Trump
Casinos, Inc. (formerly known as ("f/k/a") Trump Taj Mahal, Inc.) ("TCI"). Mr.
Trump and TCI 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 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 Trump Plaza
Funding, Inc. ("Plaza Funding"); sole Director, President and Treasurer of TCI
and Trump Atlantic City Corporation (f/k/a The Trump Taj Mahal Corporation) ("AC
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Page 5
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 Partner
Representatives of Trump's Castle Associates ("TCA"); Managing General Partner
of TCA; sole Director and President 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, is wholly owned by Mr. Trump. TCI conducts 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 TCI. TCI
has no other executive officers. The business address of TCI is Mississippi
Avenue and The 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, 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,
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Page 6
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 June
12, 1995 (the "Partnership Agreement") (attached hereto 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 June 12, 1995 (the "Exchange Rights Agreement")
(attached hereto 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 (calculated by adding the total
number of shares that were outstanding on that date to the 6,666,667 shares).
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Page 7
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. Upon conversion of all or any portion of Trump's
Limited Partnership Interest into shares of Common Stock, the corresponding
voting power of the Class B Stock would have been proportionately diminished in
an amount equal to the number of shares of Common Stock issued upon such
conversion.
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
June 12, 1995 (the "Contribution Agreement") (attached hereto 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
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Page 8
opportunities only on behalf of the Company. Mr. Trump further agreed not to
engage in certain actions in connection with Casino 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.
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 April 17, 1996, (the "Second Partnership
Agreement") (attached hereto 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
<PAGE>
Page 9
approximately 4.4% limited partnership interest ("TCI's Limited Partnership
Interest" and collectively with Trump's Limited Partnership Interest, the
"Limited Partnership Interests"). Because TCI is wholly owned by Mr. Trump, Mr.
Trump may be deemed to beneficially own the Limited Partnership Interests (an
approximately 25.1% limited partnership interest in the Partnership). The
Limited Partnership Interests represent 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 April 17, 1996 (the "Amended Exchange Rights
Agreement") (attached hereto as Exhibit II.I and incorporated herein by
reference), Trump's Limited Partnership Interest is convertible, at Mr. Trump's
option, into 6,674,006 shares of Common Stock (the "Trump Conversion Shares")
and TCI's Limited Partnership Interest is convertible, at TCI's option, into
1,407,017 shares of Common Stock (the "TCI Conversion Shares" and collectively
with the Trump Conversion Shares, the "Conversion Shares").
As of April 17, 1996, Mr. Trump and TCI each held, respectively, 800
and 200 shares of the Class B Stock. Upon conversion of all or any portion of
any of the Reporting Person's 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.
<PAGE>
Page 10
Consideration for the change in Trump's Limited Partnership Interest
and TCI's acquisition of TCI's Limited Partnership Interest 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 April 17, 1996 (the
"1996 Contribution Agreement") (attached hereto 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") (attached hereto as Exhibit V and incorporated
herein by reference) to purchase an aggregate of 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.
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-
<PAGE>
Page 11
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 not to increase, or to
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
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
<PAGE>
Page 12
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, 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 April
19, 1996, was 24,140,090 shares (the "Outstanding Shares"). This number gives
effect to the shares issued by the Company in the Taj Merger Transaction,
including (i) 13,250,000 shares of Common Stock issued to the public (the "1996
Stock Offering") pursuant to the Company's Registration Statement on Form S-1
(File No. 333-639), as amended (the "S-1 Registration Statement"), (ii) 500,000
shares of Common Stock issued directly
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Page 13
to First Union National Bank (f/k/a First Fidelity Bank, National Association)
pursuant to the S-1 Registration Statement and (iii) 323,423 shares of Common
Stock issued in connection with the Taj Merger pursuant to the Company's
Registration Statement on Form S-4 (File No. 333-153).
<PAGE>
Page 14
<TABLE>
<CAPTION>
Number of Percent of
Aggregate Shares with Shares
Number of Number of Shared Number of Number of Adjusted Beneficially
Shares Shares with Power to Shares with Shares with Number of Owned
Reporting Person Benefi-cially Sole Power Vote Sole Power Shared Shares
Owned to Vote to Dispose Power to Out-standing
Dispose
<S> <C> <C> <C> <C> <C> <C> <C>
Mr. Trump 9,881,548 8,474,256/1/ 1,407,292/2/ 8,474,256/3/ 1,407,292/4/ 34,021,113/5/ 29.0%
TCI 1,407,017 0 1,407,017/6/ 0 1,407,017/7/ 25,547,107/8/ 5.5%
</TABLE>
/1/ This number includes (i) the Trump Shares, (ii) the Trump Conversion
Shares and (iii) the shares into which the Trump Warrants are convertible.
/2/ This number includes (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 and (iii) the TCI 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 with TCI and of the Spouse Shares and Gift Shares with Mrs.
Trump. Mr. Trump disclaims beneficial ownership of the Gift Shares and the
Spouse Shares.
/3/ See note 1 above.
/4/ See note 2 above.
/5/ Calculated by adding the Conversion Shares, the shares into which the
Trump Warrants are convertible and the Outstanding Shares.
/6/ Voting power shared with Mr. Trump.
/7/ Dispositive power shared with Mr. Trump.
/8/ Calculated by adding the TCI Conversion Shares and the Outstanding Shares.
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Page 15
(c). Within the past sixty (60) days, the Reporting Persons effected
the following transactions in the Common Stock:
1. As further described in Item 3, on April 17, 1996, the
Reporting Persons acquired the Limited Partnership Interests.
2. As further described in Item 3, on April 17, 1996, Trump
acquired the Trump Warrants.
(d). Not applicable.
(e). Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
--------------------------
to Securities of the Issuer.
---------------------------
On June 5, 1995, Mr. Trump executed a lock-up agreement (attached
hereto as Exhibit IV and incorporated herein by reference) by which he agreed
that he would not, without the prior written consent of the Representatives of
the Underwriters (as defined therein), directly or indirectly, offer, sell,
contract to sell or otherwise dispose (or announce any offer, sale, contract of
sale or other disposition) of any shares of Common Stock or other shares of
capital stock of the Company, or any securities convertible into or exercisable
or exchangeable for shares of Common Stock or other shares of capital stock of
the Company, for a period of 365 days after June 7, 1995.
On April 10, 1996, each of the Reporting Persons executed a lock-up
agreement (attached hereto as Exhibits IV.I and IV.II and incorporated herein by
reference) (the "1996 Lock-Up Agreements") by which they agreed that they would
not, without the prior written consent of the Representatives of the
<PAGE>
Page 16
Underwriters (as defined therein), directly or indirectly, offer, sell, contract
to sell or otherwise dispose (or announce any offer, sale, contract of sale or
other disposition) of any shares of Common Stock or other shares of capital
stock of the Company, or any securities convertible into or exercisable or
exchangeable for shares of Common Stock or other shares of capital stock of the
Company, for a period of 180 days after April 11, 1996. The 1996 Lock-Up
Agreements expressly provide that the Reporting Persons are not prohibited from
pledging the Limited Partnership Interests or their Class B Common Stock to
Donaldson Lufkin & Jenrette, Inc. ("DLJ") and Citibank, N.A. ("Citibank").
The 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 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.
<PAGE>
Page 17
The Second Partnership Agreement has similar terms to those of the
Partnership Agreement and allows for the issuance of limited partnership
interests to TCI and 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 Partnership
Agreement provides 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 1996 Stock Offering.
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 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
<PAGE>
Page 18
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.
The Amended Exchange Rights Agreement grants Mr. Trump similar
conversion and registration rights afforded to him under the Exchange Rights
Agreement and extends such rights to TCI.
<PAGE>
Page 19
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
Exchange Rights Agreement.
On April 17, 1996, Mr. Trump entered into a transaction with 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 April 17, 1996 (the
"DLJ Pledge Agreement") (attached hereto as Exhibit VI.I and incorporated herein
by reference), the Reporting Persons granted (i) a first priority security
interest on Trump's Limited Partnership Interest, Mr. Trump's Class B Stock and
the Reporting Persons' rights under the Amended Exchange Rights Agreement and
(ii) a security interest, subject to a first priority security interest in favor
of Citibank pursuant to the Citibank Pledge Agreement (as defined), on TCI's
Limited Partnership Interest and TCI's Class B Stock.
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 April 17, 1996
(the "Citibank Pledge Agreement") (attached hereto as Exhibit VI.II and
incorporated herein by reference), the Reporting Persons granted (i) a first
priority
<PAGE>
Page 20
security interest on certain of Mr. Trump's assets and interests, including the
Trump Warrants, TCI's Limited Partnership Interest and TCI's Class B Stock, and
(ii) a security interest, subject to a first priority security interest in favor
of DLJ pursuant to the DLJ Pledge Agreement, on Mr. Trump's Limited Partnership
Interest and Mr. Trump's Class B Stock.
Because of the relationship between Mr. Trump and TCI, the Reporting
Persons may be deemed to form a "group" within the meaning of Rule 13d-5 under
the Exchange Act. TCI disclaims 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.
Item 7. Material to Be Filed as Exhibits.
--------------------------------
Exhibit I*: Amended and Restated Agreement of Limited Partnership of
----------
Trump Hotels & Casino Resorts Holdings, L.P., dated June 12, 1995.
Exhibit I.I: Second Amended and Restated Agreement of Limited
-----------
Partnership of Trump Hotels & Casino Resorts Holdings, L.P., dated April 17,
1996.
<PAGE>
Page 21
Exhibit II*: Exchange and Registration Rights Agreement between
-----------
Donald J. Trump and Trump Hotels & Casino Resorts, Inc., dated June 12, 1995.
Exhibit II.I: Amended and Restated Exchange and Registration Rights
------------
Agreement among Donald J. Trump, Trump Casinos, Inc. and Trump Hotels & Casino
Resorts, Inc., dated April 17, 1996.
Exhibit III*: Contribution Agreement between Donald J. Trump and
------------
Trump Hotels & Casino Resorts Holdings, L.P., dated June 12, 1995.
Exhibit III.I: 1996 Contribution Agreement among Donald J. Trump,
-------------
Trump Casinos, Inc., THCR/LP Corporation and Trump Hotels & Casino Resorts
Holdings, L.P., dated April 17, 1996.
Exhibit IV*: Lock-up Agreement of Donald J. Trump, dated June 5,
-----------
1995.
Exhibit IV.I: Lock-up Agreement of Donald J. Trump, dated April 10,
------------
1996.
Exhibit IV.II: Lock-up Agreement of Trump Casinos, Inc. (f/k/a Trump
-------------
Taj Mahal, Inc.), dated April 10, 1996.
Exhibit V: Common Stock Purchase Warrants issued to Donald J. Trump,
---------
dated April 17, 1996.
Exhibit VI.I: Pledge and Security Agreement among Donald J. Trump,
------------
Trump Casinos, Inc. and Donaldson Lufkin & Jenrette, Inc., dated April 17, 1996.
Exhibit VI.II: Pledge and Security Agreement among Donald J. Trump,
-------------
Trump Casinos, Inc. and Citibank, N.A., dated April 17, 1996.
<PAGE>
Page 22
Exhibit VII: Joint Filing Agreement between Donald J. Trump and Trump
-----------
Casinos, Inc., dated April 17, 1996.
______________________
* Previously filed in paper format with this Schedule 13D.
<PAGE>
Page 23
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: April 25, 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
<PAGE>
Exhibit I.I: Second Amended and Restated Agreement of Limited Partnership of
- -----------
Trump Hotels & Casino Resorts Holdings, L.P., dated April 17, 1996.
<PAGE>
EXHIBIT I.I
- -----------
_________________________________________________________________
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
_________________________________________________________________
1
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
<S> <C>
Page
ARTICLE I. DEFINITIONS................................................................................... 2
Section 1.1. Definitions............................................................................ 2
Section 1.2. Accounting Terms and Determinations.................................................... 16
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.............................................................. 17
Section 2.4. Location of Principal Place of Business................................................ 17
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................................ 19
Section 4.3. Adjustment of Partnership Interests.................................................... 21
Section 4.4. No Interest on or Return of Capital Contribution....................................... 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....................................................................... 26
Section 5.5. Tax Matters Partner.................................................................... 26
Section 5.6. Tax Elections and Returns.............................................................. 27
Section 5.7. Tax Certifications..................................................................... 28
ARTICLE VI. DISTRIBUTIONS................................................................................ 28
Section 6.1. General................................................................................ 29
Section 6.2. Distributions for Taxes................................................................ 29
Section 6.3. Other Distributions.................................................................... 30
Section 6.4. Withholding Payments Required By Law................................................... 30
Section 6.5. Non-Recourse........................................................................... 31
ARTICLE VII. RIGHTS, DUTIES AND RESTRICTIONS OF THE GENERAL PARTNER...................................... 31
Section 7.1. Powers and Duties of General Partner................................................... 31
Section 7.2. Major Decisions........................................................................ 35
Section 7.3. Reimbursement of the General Partner................................................... 35
Section 7.4. Outside Activities of the General Partner.............................................. 36
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Section 7.5. Contracts with Affiliates.............................................................. 36
Section 7.6. Title to Partnership Assets............................................................ 36
Section 7.7. Reliance by Third Parties.............................................................. 37
Section 7.8. Liability of the General Partner....................................................... 37
Section 7.9. Officers of the Partnership............................................................ 38
Section 7.10. Covenants of THCR Regarding the Issuance of New Securities............................ 38
Section 7.11. Other Matters Concerning the General Partner.......................................... 39
ARTICLE VIII. DISSOLUTION, LIQUIDATION AND WINDING-UP.................................................... 39
Section 8.1. Accounting............................................................................. 39
Section 8.2. Distribution on Dissolution............................................................ 40
Section 8.3. Timing Requirements.................................................................... 40
Section 8.4. Documentation of Liquidation........................................................... 41
Section 8.5. Dissolution............................................................................ 41
Section 8.6. Continuation of the Partnership........................................................ 41
ARTICLE IX. TRANSFER AND REDEMPTION OF PARTNERSHIP INTERESTS; CERTAIN CONSENT RIGHTS..................... 42
Section 9.1. General Partner Transfer............................................................... 42
Section 9.2. Transfers by Limited Partners.......................................................... 43
Section 9.3. Certain Additional Restrictions on Transfer............................................ 46
Section 9.4. Effective Dates of Transfers........................................................... 46
Section 9.5. Transfer............................................................................... 47
Section 9.6. Redemption of Partnership Interest..................................................... 48
Section 9.7. Certain Consent Rights................................................................. 48
ARTICLE X. RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS................................................ 48
Section 10.1. No Participation in Management........................................................ 48
Section 10.2. Bankruptcy of a Limited Partner....................................................... 49
Section 10.3. No Withdrawal......................................................................... 49
Section 10.4. Conflicts............................................................................. 49
Section 10.5. Provision of Information.............................................................. 50
Section 10.6. Limited Partner Representative........................................................ 51
Section 10.7. Power of Attorney..................................................................... 52
ARTICLE XI. INDEMNIFICATION; EXCULPATION................................................................. 53
Section 11.1. Indemnification....................................................................... 53
Section 11.2. Indemnification Procedures............................................................ 54
Section 11.3. Exculpation........................................................................... 55
Section 11.4. No Liability of Directors and Others.................................................. 55
ARTICLE XII. RIGHTS UNDER THE EXCHANGE RIGHTS AGREEMENT.................................................. 56
Section 12.1. Transfer Pursuant to Exchange Rights Agreement........................................ 56
Section 12.2. Subject to the Exchange Rights Agreement.............................................. 56
ARTICLE XIII. AMENDMENT OF PARTNERSHIP AGREEMENT, MEETINGS............................................... 56
Section 13.1. Amendments............................................................................ 56
Section 13.2. Meetings of the Partners; Notices to Partners......................................... 58
</TABLE>
(ii)
<PAGE>
<TABLE>
<S> <C>
ARTICLE XIV. CERTIFICATE OF INTEREST..................................................................... 59
Section 14.1. Form of Certificate of Interest....................................................... 59
Section 14.2. Transfers of Certificates of Interest................................................. 59
Section 14.3. Lost, Stolen, Destroyed or Mutilated Certificates of Interest......................... 60
Section 14.4. Inspection of Certificate Transfer Ledger............................................. 60
ARTICLE XV. REGULATORY REQUIREMENTS...................................................................... 60
Section 15.1. Applicable Regulatory Authority and CCC Regulation.................................... 60
Section 15.2. Additional Applicable Regulatory Authority Regulation................................. 61
Section 15.3. Disqualified Holders.................................................................. 62
ARTICLE XVI. GENERAL PROVISIONS.......................................................................... 63
Section 16.1. Notices............................................................................... 63
Section 16.2. Controlling Law....................................................................... 63
Section 16.3. No Third Party Beneficiaries.......................................................... 63
Section 16.4. Execution in Counterparts............................................................. 63
Section 16.5. Provisions Separable.................................................................. 64
Section 16.6. Entire Agreement...................................................................... 64
Section 16.7. Paragraph Headings.................................................................... 64
Section 16.8. Gender, Etc........................................................................... 64
Section 16.9. Number of Days........................................................................ 64
Section 16.10. Partners Not Agents.................................................................. 64
Section 16.11. Assurances........................................................................... 64
Section 16.12. Successors and Assigns............................................................... 65
Section 16.13. Waiver............................................................................... 65
</TABLE>
Schedules
---------
SCHEDULE I -- Aggregate Capital Contributions
SCHEDULE II -- Capital Contributions Prior to April 17, 1996
SCHEDULE III -- Capital Contributions in connection with the Merger
Transaction
Exhibits
--------
EXHIBIT A -- Form of 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.
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
TRUMP HOTELS & CASINO RESORTS HOLDINGS, L.P.
THIS SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP is
made and entered into this 17th day of April 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
-----------------------
(formerly TM/GP Corporation) ("THCR/LP"), Trump Casinos, Inc., a New Jersey
corporation (formerly Trump Taj Mahal, Inc.) ("TCI"), 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; and
WHEREAS, THCR and Trump entered into an Amended and Restated Agreement
of Limited Partnership on June 12, 1995;
WHEREAS, effective on the date hereof, the General Partner and Trump
desire to cause certain capital contributions to the Partnership, as set forth
on Schedule III hereto, in connection with the "Merger Transaction," as such
term is defined in the final prospectus dated April 11, 1996 included in the
General Partner's Registration Statement on Form S-1 (Registration No. 333-639);
and
WHEREAS, in exchange for their capital contributions as set forth in
Schedule III, effective on the date hereof, THCR/LP and TCI are being admitted
to the Partnership as Limited Partners; and
WHEREAS, the parties hereto desire to continue the Partnership as a
limited partnership under the Delaware Revised
<PAGE>
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 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
-2-
<PAGE>
(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 Second 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 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.
-3-
<PAGE>
"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 Treasury
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.
-------
"CCC" shall mean the New Jersey Casino Control Commission and any
---
successor agency.
"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.
-4-
<PAGE>
"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 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).
-------
-5-
<PAGE>
"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.
"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.
---------------
"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,
-6-
<PAGE>
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 Amended and Restated
-------------------------
Exchange and Registration Rights Agreement, substantially in the form of Exhibit
A hereto, to be entered into by and among Trump, TCI 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
-------------------
between Trump and the Partnership, 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.
"Gary Riverboat" shall mean a riverboat or dockside gaming facility
--------------
and the ancillary structures and other
-7-
<PAGE>
facilities used in connection with the operation thereof located in Gary,
Indiana.
"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 (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:
-8-
<PAGE>
(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 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
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<PAGE>
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 Act" shall mean the Indiana Riverboat Gambling
---------------------
Act, Ind. Code (S) 4-33-1-1 et seq.
-- ----
"Initial Limited Partner" shall have the meaning set forth in the
-----------------------
Introduction 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.
"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
-10-
<PAGE>
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.
"Merger Transaction" shall have the meaning set forth in the
------------------
Recitals to this Agreement.
"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 (S) 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 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
-11-
<PAGE>
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, however, that New Securities shall not include (i) Class
B Stock and Common Stock issued by THCR prior to the date of this Agreement,
(ii) the Common Stock to be issued by THCR pursuant to (x) a Registration
Statement on Form S-1 (Registration No. 333-639) (including the underwriters'
over-allotment option with respect thereto) or (y) a Registration Statement on
Form S-4 (Registration No. 333-153), or (iii) the First Mortgage Notes to be
issued by Trump AC and Trump Atlantic City Funding, Inc. pursuant to
Registration Statements on Form S-1 (Registration Nos. 333-643 and 333-2439).
"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.
"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.
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<PAGE>
"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, TCI and Trump shall 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.
"Permitted Partners" shall have the meaning set forth in Section
------------------
5.1(b)(ii).
"Person" shall mean any natural person or Entity.
------
"Redemption Date" shall mean the date fixed by the General Partner for
---------------
the redemption of any Partnership Interests pursuant to Article XV.
-13-
<PAGE>
"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).
"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.
"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 mean Trump Taj Mahal Associates, a New
--------------
Jersey general partnership.
-14-
<PAGE>
"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.
"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 Partnership 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);
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.
"TCI" shall mean Trump Casinos, Inc., a New Jersey corporation.
---
-15-
<PAGE>
"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 Introduction 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.
"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.
-16-
<PAGE>
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.
----
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.
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.
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 Gary Riverboat, and (iv) 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 Mississippi
Avenue and The 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
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<PAGE>
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, 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. Effective as
of the date hereof, the General Partner and the Limited Partners (including
THCR/LP and TCI) shall make or cause to be made the Capital Contributions
set forth opposite their respective names on Schedule III hereto, and
THCR/LP and TCI shall become Limited Partners of the Partnership. The
General Partner and the Initial Limited Partner hereby consent to the
admission of THCR/LP and TCI as Limited Partners. 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 and III), 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
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<PAGE>
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 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, and TCI, 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
-19-
<PAGE>
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
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;
-20-
<PAGE>
(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.
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
-21-
<PAGE>
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.
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 periods, among the Partners
in the reverse order that such Net Loss was allocated to the Permitted
Partners pursuant to subparagraph (b)(ii) hereof.
(i) 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
-22-
<PAGE>
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.
(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.
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<PAGE>
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.
(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 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
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<PAGE>
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). Property contributed to
-------------------------------------
the Partnership shall be subject to Section 704(c) of the Code and
Regulation Section 1.704-3 so that 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 the Initial Limited Partner pursuant to the Contribution
Agreement between the Partnership and the Initial Limited Partner, dated as
of June 12, 1995, and Partnership property contributed pursuant to the 1996
Contribution Agreement among Trump, TCI, THCR/LP and the Partnership, 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 all 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, however, 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)
to cure for the effect of the ceiling rule set forth in Regulation Section
1.704-3(b). 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
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<PAGE>
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.
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 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.
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<PAGE>
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 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,
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 the date
hereof, 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
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<PAGE>
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.
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
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.
-----------------------
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
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<PAGE>
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 "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.
------------------------------------
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,
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<PAGE>
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 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
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<PAGE>
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.
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
-31-
<PAGE>
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;
(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
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<PAGE>
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 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;
(xi) 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
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<PAGE>
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 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.
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<PAGE>
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 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, however, that the foregoing shall not
limit any of the transactions relating to the Merger Transaction.
(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 Partnership Agreement, (B) the Services
Agreement between Trump Plaza Associates and the Initial Limited
Partner as in effect on the date of this Partnership Agreement, or (C)
with the approval of
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<PAGE>
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 Partnership
Agreement, (B) the Services Agreement between Trump Plaza Associates
and the Initial Limited Partner as in effect on the date of this
Partnership Agreement, or (C) 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
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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.
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:
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(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 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
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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.
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
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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 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
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<PAGE>
(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 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
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<PAGE>
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 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.
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<PAGE>
(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 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
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<PAGE>
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 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
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<PAGE>
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 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.
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<PAGE>
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 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
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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.
(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
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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 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, and 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
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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 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
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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 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.
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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 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 and TCI 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 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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<PAGE>
(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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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 and the Initial Limited Partner 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 in
compliance with the terms and provisions of this Agreement,
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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 Casino Control
Commission 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 Commission under the
circumstances. It is the intent of this Section 15.1 to set forth
procedures to permit the
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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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(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. The address of any party hereto may be changed by a
notice in writing given in accordance with the provisions hereof.
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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.
-62-
<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.
-63-
<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/
-------------------------------------
Name: Robert M. Pickus
Title: Executive Vice President
and Secretary
Address: Mississippi Avenue and
The Boardwalk
Atlantic City,
New Jersey 08401
LIMITED PARTNERS: (Addresses
----------------
are as set forth on Schedule I):
DONALD J. TRUMP
By: /s/
-------------------------------------
Donald J. Trump
TRUMP CASINOS, INC.
By: /s/
-------------------------------------
Donald J. Trump
President
THCR/LP CORPORATION
By: /s/
-------------------------------------
Name: Nicholas F. Moles
Title: Secretary
-64-
<PAGE>
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED, that on April 17, 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 April 17, 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 April 17, 1996 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 April 17, 1996, before me, the subscriber,
personally appeared Nicholas F. Moles, the Secretary 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>
SCHEDULE I
----------
AGGREGATE CAPITAL CONTRIBUTIONS
<TABLE>
<CAPTION>
Partner Contribution Percentage Interest
- ------- ------------ -------------------
<S> <C> <C>
Trump Hotels & Casino Resorts, Inc. $516,002,095.27 70.19992% general partner
Donald J. Trump $ 93,337,725.62 21.20677%* limited partner
725 Fifth Avenue
New York, N.Y. 10022
Trump Casinos, Inc. $ 43,921,854.66 4.47082% limited partner
1000 The Boardwalk
Atlantic City, NJ 08401
THCR/LP Corporation $ 40,499,861.91 4.12249% limited partner
1000 The Boardwalk
Atlantic City, N.J. 08401
</TABLE>
* Certificate No. 4 represents 99.89004% of such percentage interest and
Certificate No. 4-A represents 0.10996% of such percentage interest.
Dated: April 17, 1996
<PAGE>
SCHEDULE II
-----------
CAPITAL CONTRIBUTIONS PRIOR TO APRIL 17, 1996
<TABLE>
<CAPTION>
Partner Contribution Percentage Interest
- ------- ------------ -------------------
<S> <C> <C>
Trump Hotels & Casino Resorts, Inc. $140,933,338 60.15936% general partner
Donald J. Trump $ 93,333,333 39.84064% limited partner
</TABLE>
Dated: April 17, 1996
<PAGE>
SCHEDULE III
------------
CAPITAL CONTRIBUTIONS IN CONNECTION WITH THE
MERGER TRANSACTIONS
(EXCLUDING UNDERWRITERS' EXERCISE OF OVER-ALLOTMENT OPTION IN CONNECTION WITH
THCR COMMON STOCK OFFERING)
<TABLE>
<CAPTION>
Partner Contribution
- ------- ------------
<S> <C>
Trump Hotels & Casino Resorts, Inc. $375,068,757.27
Donald J. Trump $ 4,392.62
Trump Casinos, Inc. $ 43,921,854.66
THCR/LP Corporation $ 40,499,861.91
</TABLE>
Dated: April 17, 1996
<PAGE>
Exhibit II.I: Amended and Restated Exchange and Registration Rights Agreement
- ------------
among Donald J. Trump, Trump Casinos, Inc. and Trump Hotels & Casino Resorts,
Inc., dated April 17, 1996.
<PAGE>
EXHIBIT II.I
- ------------
AMENDED AND RESTATED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
---------------------------------------------------------------
AMENDED AND RESTATED EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, dated as
of April 17, 1996, by and among Trump Hotels & Casino Resorts, Inc., a Delaware
corporation (the "Company"), Donald J. Trump ("Trump") and Trump Casinos, Inc.,
a New Jersey corporation wholly owned by Trump ("TCI").
WHEREAS, the Company and Trump are parties to 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 "Merger Transaction"), (i) Trump is contributing to Trump Atlantic City
Associates ("Trump AC") (on behalf, and at the direction, of the Partnership)
shares of capital stock of The Trump Taj Mahal Corporation, ("TTMC"), which
holds a .01% general partnership interest in Taj Associates, and (ii) TCI is
contributing to Trump AC (on behalf, and at the direction, of the Partnership)
its 49.995 general partnership interest in Taj Associates;
WHEREAS, as consideration of such contributions by Trump and TCI, the
Partnership is issuing limited partnership interests to each of Trump and TCI;
WHEREAS, in connection with the issuance of, and with respect to, such
limited partnership interests, the Company has agreed to grant Trump and TCI the
exchange rights and registration rights set forth below, and pursuant to the
Initial Agreement, Trump was issued certain exchange rights and registration
rights; and
WHEREAS, the Company and Trump have agreed to amend and restate the Initial
Agreement in its entirety and to add TCI 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:
<PAGE>
ARTICLE
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 Second Amended and Restated Agreement of Limited Partnership of the
Partnership (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 introduction 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 6,674,006 with respect to Trump, and 1,407,017 with
respect to TCI, and which numbers shall be adjusted as provided in Article II.
"Conversion Partner" means an Optionee other than (i) Trump, (ii) TCI
and (iii) any Permitted Holder with respect to Trump.
"Conversion Right" has the meaning set forth in Section 2.2 hereof.
"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.
-2-
<PAGE>
"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 and (iii) each assignee of
Partnership Interests of Trump and TCI 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.
"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.
-3-
<PAGE>
"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 introduction hereto.
"Trump" has the meaning ascribed thereto in the introduction 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.
ARTICLE
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)
-4-
<PAGE>
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 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 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
-5-
<PAGE>
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 the (I) number of shares of Common Stock
outstanding immediately prior to such issuance and the (II) number of
shares 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
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, however, 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.
(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
-6-
<PAGE>
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 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.
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, 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.
-7-
<PAGE>
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 The Boardwalk and Mississippi Avenue, 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.
(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
-8-
<PAGE>
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 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
-9-
<PAGE>
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 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
-10-
<PAGE>
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 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.
-11-
<PAGE>
(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 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
-12-
<PAGE>
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.
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
-13-
<PAGE>
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
Commission pursuant to this Article V, the Company shall provide each
holder of Registrable Securities included in such registration statement,
and 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 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,
and 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 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
-14-
<PAGE>
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.
(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:
(1) make and keep available current public information concerning
the Company as those terms are
-15-
<PAGE>
understood and defined in Rule 14 under the Securities Act ("Rule
144");
(2) 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
(3) 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 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,
-16-
<PAGE>
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; and provided
further, however, 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
incorporated by reference herein and shall be deemed a part of this Agreement.
By executing and delivering this Agreement, the Company and Trump agree to the
termination of the Initial 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.
-17-
<PAGE>
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 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.
-18-
<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
Executive Vice President
TRUMP CASINOS, INC.
By: /s/
---------------------------------
Donald J. Trump
President
/s/
---------------------------------
Donald J. Trump
-19-
<PAGE>
LETTER OF TRANSMITTAL
To Tender Partnership Interests
Pursuant to the Amended and Restated Exchange and Registration Rights Agreement
Dated as of April __, 1996
of
Trump Hotels & Casino Resorts, Inc.
TO: Trump Hotels & Casino Resorts, Inc.
Mississippi Avenue and The 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 Amended and Restated Exchange and Registration
Rights Agreement dated as of April __, 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.
<TABLE>
<S> <C> <C>
Substitute Part 1 - Please provide Social Security
Form W-9 your TIN in the box at Number/Employer
right and certify by Identification Number
signing and dating below ____________
Department of the Certification - Under the
Treasury/ Internal penalties of Perjury, (i)
Revenue Service I certify that the
information provided on
this form is true, correct
and complete and (ii) I am
not subject to backup
withholding because: (a) 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 __________
____________________
</TABLE>
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.
<PAGE>
Exhibit III.I: 1996 Contribution Agreement among Donald J. Trump; Trump
Casinos, Inc., THCR/LP Corporation and Trump Hotels & Casino Resorts Holdings,
L.P., dated April 17, 1996.
<PAGE>
EXHIBIT III.I
- -------------
1996 CONTRIBUTION AGREEMENT
---------------------------
1996 CONTRIBUTION AGREEMENT, dated as of April 17, 1996, between
Donald J. Trump ("Trump"), Trump Casinos, Inc., a New Jersey corporation wholly
owned by Trump (fka Trump Taj Mahal, Inc.) ("TCI"), THCR/LP Corporation, a New
Jersey corporation (fka TM/GP Corporation) ("THCR/LP" and collectively with
Trump and TCI, the "Transferors"), and Trump Hotels & Casino Resorts Holdings,
L.P., a Delaware limited partnership (the "Transferee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, each of TCI and THCR/LP holds a 49.995% general partnership
interest in Trump Taj Mahal Associates ("Taj Associates, and each of Trump and
THCR Holding Corp. (fka Taj Mahal Holding Corp.)("THCR Holding") owns 50% of the
capital stock of Trump Atlantic City Corporation (fka The Trump Taj Mahal
Corporation) ("TACC"), which holds a .01% general partnership interest in Taj
Associates;
WHEREAS, concurrently with the execution of this Agreement, the
Transferors and Transferee are entering into a Second Amended and Restated
Agreement of Limited Partnership of the Transferee, dated as of the date hereof
(the "Partnership Agreement"), pursuant to which Trump will continue as a
Limited Partner (as defined therein) of the Transferee and each of THCR/LP and
TCI will become Limited Partners of the Transferee on the terms and subject to
the conditions set forth therein; and
WHEREAS, in connection with the acquisition of Taj Associates by the
Transferee and the other transactions related thereto (the "Merger
Transaction"), including the issuance of First Mortgage Notes by Trump Atlantic
City Associates and Trump Atlantic City Funding, Inc. (the "Mortgage Note
Offering"), following the consummation of the Mortgage Note Offering, Trump
Hotels & Casino Resorts, Inc. ("THCR") will cause THCR Holding to contribute the
shares of capital stock of TACC to THCR/LP, and each of Trump, TCI and THCR/LP
will then contribute their respective interests in Taj Associates and TACC to
the Transferee on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and the other agreements being entered in connection
with the Merger Transaction 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:
<PAGE>
ARTICLE I.
The Contribution
----------------
Section 1.1. The Capital Contribution. Effective as of the date
------------------------
hereof and in fulfillment of the obligation of the Transferors to make the
capital contributions pursuant to Section 4.1 of the Partnership Agreement, each
of the Transferors hereby contributes, transfers, assigns and conveys to the
Transferee all right, title and interest in and to those assets of the
respective Transferor set forth opposite its name on Schedule A hereto (the
foregoing being referred to collectively as the "Assets").
Section 1.2. Direction of Transfer. Transferee hereby directs that
---------------------
the Transferors effect the transfer of the Assets by contributing, transferring,
assigning and conveying such Assets, on behalf of the Transferee, directly to
the Transferee's wholly owned subsidiary, Trump Atlantic City Associates.
ARTICLE II.
The Consideration
-----------------
Section 2.1. Obligations of the Transferee. In further
-----------------------------
consideration for the contribution of the Assets pursuant to Section 1.1, the
Transferee, on behalf of itself and its subsidiaries now existing and hereafter
acquired, hereby:
(i) accepts all right, title and interest in and to the Assets and
does hereby assume and agree to promptly and fully pay, perform and
discharge when due all obligations and liabilities associated with the
Assets (collectively, the "Assumed Liabilities," including, without
limitation, all obligations and liabilities of each of TCI, THCR/LP and
TACC as a general partner of Taj Associates, but excluding any liabilities
arising out of breaches of the representations and warranties of the
Transferors contained in Article III hereof); and
(ii) agrees to indemnify the Transferors against all actions,
proceedings, costs, damages, claims and demands arising in connection with
the Assumed Liabilities subsequent to the date hereof except insofar as
such actions, proceedings, costs, damages, claims and demands arise out of
the gross negligence or willful misconduct of such Transferor.
2
<PAGE>
ARTICLE III.
Representations and Warranties
------------------------------
Each Transferor hereby severally represents and warrants to the
Transferee that, as of the date hereof:
Section 3.1. Due Execution and Delivery; Enforceability. This
------------------------------------------
Agreement has been duly executed and delivered by such Transferor in accordance
with its terms and is a legal, valid and binding agreement of such Transferor
enforceable against such Transferor in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and similar laws affecting creditors' rights and remedies generally and
to general principles of equity (regardless of whether enforcement is sought in
a proceeding at law or in equity).
Section 3.2. No Conflicts. The execution, delivery and performance
------------
of this Agreement by such Transferor, and the consummation of the transactions
contemplated hereby, do not and will not conflict with or result in a breach or
violation of (i) any of the respective charters or by-laws of such Transferor or
any of its subsidiaries, as applicable, (ii) any of the terms or provisions of,
or constitute a default or cause an acceleration or any obligation under, or
result in the imposition or creation of (or the obligation to create or impose),
any security interest, mortgage, pledge, claim, lien, encumbrance or adverse
interest of any nature (each, a "Lien") with respect to any obligation, bond
agreement, note, debenture or other evidence of indebtedness or any indenture,
mortgage, deed of trust or other agreement, lease or instrument to which such
Transferor or any of its Affiliates is a party or by which such Transferor or
any of its Affiliates is bound or to which any of the properties or assets of
such Transferor or any of its Affiliates (including, without limitation, the
Assets transferred by such Transferor) may be subject or (iii) any Federal,
state or local law, rule, administrative regulation or ordinance or order of any
court or governmental agency, body or official having jurisdiction over such
Transferor or any of the Assets transferred by such Transferor, except, in the
case of clauses (ii) and (iii), for such conflicts, breaches, violations,
defaults or Liens that would not have a material adverse effect on the Assets
transferred by such Transferor (a "Material Adverse Effect").
Section 3.3. No Consents or Approvals. No authorization, approval,
------------------------
consent or order of, or filing with, any court or governmental body, agency or
official, including the New Jersey Casino Control Commission, the New Jersey
Department of Environmental Protection and the Indiana Gaming Commission, is
necessary in connection with the transactions contemplated by this Agreement,
except those of which have been obtained or made on or prior to the date hereof.
3
<PAGE>
Section 3.4. Title to Assets. Such Transferor has good title to
---------------
the Assets that it is transferring pursuant to this Agreement, free and clear of
any Liens.
ARTICLE IV.
Further Documents
-----------------
Each of the Transferors and the Transferee hereby undertakes that it
will, and will cause its Affiliates to, execute and undertake to perform at the
Transferee's expense all such further agreements, documents and other actions as
may be reasonably necessary for vesting the Assets in the Transferee and Trump
AC and otherwise for giving full effect to this Agreement.
ARTICLE V.
Miscellaneous
-------------
Section 5.1. Waiver, Amendment. Neither this Agreement nor any
-----------------
provision hereof shall be waived, amended, modified, changed, discharged or
terminated except by an instrument in writing executed by the Transferors and
the Transferee.
Section 5.2. Assignability. Neither this Agreement nor any right,
-------------
remedy, obligation or liability arising hereunder or by reason hereof shall be
assignable by the Transferors or the Transferee, without the prior written
consent of each other parties.
Section 5.3. Entire Agreement. This Agreement, together with the
----------------
schedule hereto, 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 schedules 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. All of the documents referred to in the
immediately preceding sentence are hereby incorporated by reference and shall be
deemed a part of this Agreement with the same effect as if set forth in full
herein.
4
<PAGE>
Section 5.4. 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.
Section 5.5. Section and Other Headings. The section headings
--------------------------
contained in this Agreement and the schedules thereto are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.
Section 5.6. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
-------------
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW JERSEY, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF. THE TRANSFERORS AND
THE TRANSFEREE HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW JERSEY
STATE COURT SITTING IN ATLANTIC CITY, NEW JERSEY OR ANY FEDERAL COURT SITTING IN
ATLANTIC CITY, NEW JERSEY IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT, AND IRREVOCABLY ACCEPT FOR THEMSELVES AND
IN RESPECT OF THEIR PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE
AFORESAID COURTS. THE TRANSFERORS AND THE TRANSFEREE IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION
WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN ANY
INCONVENIENT FORUM.
Section 5.7. 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 5.8. 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 Trump or TCI, at 725 Fifth Avenue, 26th Floor, New York, NY 10022 or (b)
if to THCR/LP or the Transferee, at Mississippi Avenue and The Boardwalk,
Atlantic City, New Jersey 08401 and addressed to the attention of the Corporate
Secretary.
5
<PAGE>
Section 5.9. Compliance with State Gaming Regulations. Each of
----------------------------------------
the provisions of this Agreement is subject to and shall be enforced in
compliance with the provisions, regulations or approvals required by any state
gaming authority, including, without limitation, the New Jersey Casino Control
Commission and the Indiana Gaming Commission.
Section 5.10. Third Party Rights. Except as otherwise set forth
------------------
herein, nothing in this Agreement is intended or shall be construed to confer
upon or give any Person, other than the parties hereto, Trump AC and THCR, and
each of their respective successors, any rights or remedies under or by reason
of this Agreement or any transaction contemplated hereby.
Section 5.11. Limitation on Damages. No party shall be liable to
---------------------
the other parties for any consequential damages resulting from a breach of this
Agreement.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
/s/
------------------------------------
DONALD J. TRUMP
(individually and as sole
stockholder of Trump
Casinos, Inc.)
TRUMP CASINOS, INC.
By: /s/
---------------------------------
Donald J. Trump
President
THCR/LP CORPORATION
By: /s/
---------------------------------
Nicholas F. Moles
Secretary
TRUMP HOTELS & CASINO RESORTS
HOLDINGS, L.P.
By: Trump Hotels & Casino Resorts, Inc.,
its general partner
By: /s/
---------------------------
Robert M. Pickus
Executive Vice President
7
<PAGE>
SCHEDULE A
ASSETS
TRANSFEROR ASSETS TRANSFERRED
- ---------- ------------------
Donald J. Trump 20 shares of Common Stock of
Trump Atlantic City Corporation
(fka The Trump Taj Mahal Corporation)
Trump Casinos, Inc. 49.995% general partnership
interest in Trump Taj Mahal
Associates
THCR/LP Corporation 20 shares of Common Stock of
Trump Atlantic City Corporation
(fka The Trump Taj Mahal
Corporation)
and
49.995% general partnership
interest in Trump Taj Mahal Associates
<PAGE>
Exhibit IV.I: Lock-up Agreement of Donald J. Trump, dated April 10, 1996
- ------------
<PAGE>
EXHIBIT IV.I
- ------------
April 10, 1996
Donaldson, Lufkin & Jenrette
Securities Corporation
Salomon Brothers Inc
BT Securities Corporation
Sands Brothers & Co., Ltd.
As Representatives of the
several Underwriters
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10172
Ladies and Gentlemen:
The undersigned understands that Trump Hotels & Casino Resorts, Inc.
(the "Company") is contemplating a public offering (the "Offering") of up to
14,375,000 shares (the "Shares") (including up to 1,875,000 shares that the
Underwriters have an option to purchase to cover over-allotments) and up to an
additional 20% of such number of shares of its common stock, par value $.01 per
share (the "Common Stock"), and that, in connection therewith, you propose to
enter into an Underwriting Agreement (the "Underwriting Agreement") providing
for the purchase of the number of Shares specified therein by you and the
several underwriters (the "Underwriters") listed in Schedule I to the
Underwriting Agreement.
In order to induce you to enter into the Underwriting Agreement, the
undersigned agrees that, without your prior written consent, the undersigned
will not, except as set forth herein, directly or indirectly, offer, sell,
contract to sell or otherwise dispose (or announce any offer, sale, contract of
sale or other disposition) of any shares of Common Stock or other shares of
capital stock of the Company, or any securities convertible into or exercisable
or exchangeable for shares of Common Stock or other shares of capital stock of
the Company, for a period of 180 days after the date of the Company's final
prospectus relating to the Offering (the "Final Prospectus").
This letter shall not impair, prohibit or in any way prevent the
undersigned from entering into one or more agreements with (i) Donaldson Lufkin
& Jenrette, Inc. ("DLJ"), a corporation which wholly owns Donaldson Lufkin &
Jenrette Securities Corporation and (ii) Citibank, N.A., a national banking
association ("Citibank"), which agreements will provide for the pledge by the
undersigned to DLJ and Citibank, respectively, of (a) limited partnership
interests in Trump Hotels & Casino Resorts Holdings, L.P. ("THCR Holdings")
owned after the Merger Transaction (as defined in the Final Prospectus) by the
undersigned and convertible into shares of Common Stock and (b) shares of the
Company's Class B Common Stock, par value $.01 per share (the "Class B Common
Stock") owned after the Merger Transaction by the undersigned, which Class B
Common Stock has voting power equivalent to the voting power of the Common Stock
into which limited partnership interests in THCR Holdings are convertible.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance upon this Agreement.
/s/
------------------------
Donald J. Trump
<PAGE>
Exhibit IV.II: Lock-up Agreement of Trump Casinos, Inc. (f/k/a Trump Taj mahal,
Inc.), dated April 10, 1996.
<PAGE>
EXHIBIT IV.II
April 10, 1996
Donaldson, Lufkin & Jenrette
Securities Corporation
Salomon Brothers Inc
BT Securities Corporation
Sands Brothers & Co., Ltd.
As Representatives of the
several Underwriters
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10172
Ladies and Gentlemen:
The undersigned understands that Trump Hotels & Casino Resorts, Inc.
(the "Company") is contemplating a public offering (the "Offering") of up to
14,375,000 shares (the "Shares") (including up to 1,875,000 shares that the
Underwriters have an option to purchase to cover over-allotments) and up to an
additional 20% of such number of shares of its common stock, par value $.01 per
share (the "Common Stock"), and that, in connection therewith, you propose to
enter into an Underwriting Agreement (the "Underwriting Agreement") providing
for the purchase of the number of Shares specified therein by you and the
several underwriters (the "Underwriters") listed in Schedule I to the
Underwriting Agreement.
In order to induce you to enter into the Underwriting Agreement, the
undersigned agrees that, without your prior written consent, the undersigned
will not, except as set forth herein, directly or indirectly, offer, sell,
contract to sell or otherwise dispose (or announce any offer, sale, contract of
sale or other disposition) of any shares of Common Stock or other shares of
capital stock of the Company, or any securities convertible into or exercisable
or exchangeable for shares of Common Stock or other shares of capital stock of
the Company, for a period of 180 days after the date of the Company's final
prospectus relating to the Offering (the "Final Prospectus").
This letter shall not impair, prohibit or in any way prevent the
undersigned from entering into one or more agreements with (i) Donaldson Lufkin
& Jenrette, Inc. ("DLJ"), a corporation which wholly owns Donaldson Lufkin &
Jenrette Securities Corporation and (ii) Citibank, N.A., a national banking
association ("Citibank"), which agreements will provide for the pledge by the
undersigned to DLJ and Citibank, respectively, of (a) limited partnership
interests in Trump Hotels & Casino Resorts Holdings, L.P. ("THCR Holdings")
owned after the Merger Transaction (as defined in the Final Prospectus) by the
undersigned and convertible into shares of Common Stock and (b) shares of the
Company's Class B Common Stock, par value $.01 per share (the "Class B Common
Stock") owned after the Merger Transaction by the undersigned, which Class B
Common Stock has voting power equivalent to the voting power of the Common Stock
into which limited partnership interests in THCR Holdings are convertible.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance upon this Agreement.
TRUMP TAJ MAHAL, INC.
/s/
---------------------------------
By: Donald J. Trump
Title: President and Treasurer
<PAGE>
Exhibit V: Common Stock Purchase Warrants issued to Donald J. Trump, dated
April 17, 1996.
<PAGE>
EXHIBIT V
- ---------
Warrant No. W-001
WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION UNDER
THE SECURITIES ACT OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL
REASONABLY SATISFACTORY TO TRUMP HOTELS & CASINO RESORTS, INC., QUALIFIES AS AN
EXEMPT TRANSACTION UNDER THE SECURITIES ACT AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER.
TRUMP HOTELS & CASINO RESORTS, INC.
COMMON STOCK PURCHASE WARRANT
TRUMP HOTELS & CASINO RESORTS, INC., a Delaware corporation (the
"Company"), hereby certifies that, for value received, DONALD J. TRUMP
("Trump"), or his assigns, is entitled, subject to the terms set forth below, to
purchase from the Company, at any time and from time to time during the period
beginning on April 17, 1996 and ending on April 17, 1999 in whole or in part, an
aggregate of six hundred thousand (600,000) fully paid and non-assessable shares
of the Common Stock of the Company, par value $ .01 per share, at a purchase
price, subject to the provisions of Section 3 hereof, of $30.00 per share (the
"Purchase Price"). The Purchase Price and the number and character of such
shares are subject to adjustment as provided below, and the term "Common Stock"
shall mean, unless the context otherwise requires, the stock or other securities
or property at the time deliverable upon the exercise of this Warrant. This
Warrant is herein called the "Warrant."
1. EXERCISE OF WARRANT. The purchase rights evidenced by this
Warrant shall be exercised by the holder surrendering this Warrant, with the
form of subscription at the end hereof duly executed by such holder, to the
Company at its office in Atlantic City, New Jersey, accompanied by payment, of
an amount (the "Exercise Amount") equal to the Purchase Price multiplied by the
number of shares being purchased pursuant to such exercise, payable as follows:
(i) by payment to the Company in cash, by certified or official bank check, or
by wire transfer of the Exercise Amount, (ii) by surrender to the Company for
cancellation of securities of the Company having a Market Price (as hereinafter
defined) on the date of exercise equal to the Exercise Amount; or (c) by a
combination of the methods described in clauses (a) and (b) above. In lieu of
exercising the Warrant, the holder may elect to receive a payment equal to the
difference between (i) the Market Price multiplied by the number of shares as to
which the payment is then being elected and (ii) the exercise price with respect
to such shares, payable by the Company to the holder of this Warrant only in
shares of Common Stock valued at the Market Price on the date of exercise. For
purposes hereof, the term "Market Price" shall mean the average high and low
sale price of a share of Common Stock for the 15 consecutive trading days
preceding such day on the principal national securities exchange on which the
shares of Common Stock or securities are listed or admitted to trading or, if
not listed or admitted to trading on any national securities exchange, the
average of the reported bid and asked prices during such 15 trading day period
in the over-the-counter market as furnished by the National Quotation Bureau,
Inc., or, if such firm is not then engaged in the business of reporting such
prices, as furnished by any member of the National Association of Securities
Dealers, Inc. selected by the Company or, if the shares of Common Stock or
securities are not publicly traded, the Market Price for such day shall be the
fair market value thereof determined jointly by the Company and the holder of
this Warrant; provided, however, that if such parties are unable to reach
agreement within a reasonable period of time, the Market Price shall be
determined in good faith by the independent investment banking firm selected
jointly by the Company and the holder of this Warrant or, if that selection
cannot be made within 15 days, by an independent investment banking firm
selected by the American Arbitration Association in accordance with its rules.
<PAGE>
1.1 Partial Exercise. This Warrant may be exercised for less than
----------------
the full number of shares of Common Stock, in which case the number of shares
receivable upon the exercise of this Warrant as a whole, and the sum payable
upon the exercise of this Warrant as a whole, shall be proportionately reduced.
Upon any such partial exercise, the Company at its expense will forthwith issue
to the holder hereof a new Warrant or Warrants of like tenor calling for the
number of shares of Common Stock as to which rights have not been exercised,
such Warrant or Warrants to be issued in the name of the holder hereof or his
nominee (upon payment by such holder of any applicable transfer taxes).
2. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as
practicable after the exercise of this Warrant and payment of the Purchase
Price, and in any event within ten (10) days thereafter, the Company, at its
expense, will cause to be issued in the name of and delivered to the holder
hereof a certificate or certificates for the number of fully paid and non-
assessable shares or other securities or property to which such holder shall be
entitled upon such exercise, plus, in lieu of any fractional share to which such
holder would otherwise be entitled, cash in an amount determined in accordance
with Section 3.9 hereof. The Company agrees that the shares so purchased shall
be deemed to be issued to the holder hereof as the record owner of such shares
as of the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid.
3. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS. In order to
prevent dilution of the right granted hereunder, the Purchase Price shall be
subject to adjustment from time to time in accordance with this Section 3. Upon
each adjustment of the Purchase Price pursuant to this Section 3, the registered
holder of this Warrant shall thereafter be entitled to acquire upon exercise, at
the Purchase Price resulting from such adjustment, the number of shares of the
Company's Common Stock obtainable by multiplying the Purchase Price in effect
immediately prior to such adjustment by the number of shares of the Company's
Common Stock acquirable immediately prior to such adjustment and dividing the
product thereof by the Purchase Price resulting from such adjustment.
3.1. Adjustment for Issue or Sale of Common Stock at less than Market
----------------------------------------------------------------
Price. (a) Except as provided in Section 3.2 or 3.5 below, if and whenever on
- -----
or after the date of issuance hereof the Company shall issue or sell, or shall
in accordance with subsections 3.1(c)(1) to (9), inclusive, be deemed to have
issued or sold, any shares of its Common Stock for a consideration per share
less than the Market Price in effect immediately prior to the time of such issue
or sale, then forthwith upon such issue or sale (the "Triggering Transaction"),
the Purchase Price shall, subject to subsections (1) to (9) of Section 3.1(c),
be reduced to the lower of the prices (calculated to the nearest tenth of a
cent) determined as follows:
(i) by dividing (a) an amount equal to the sum of (x) the product
derived by multiplying the Number of Common Shares Deemed Outstanding
immediately prior to such Triggering Transaction by the Purchase Price then
in effect, plus (y) the consideration, if any, received by the Company upon
consummation of such Triggering Transaction, by (b) an amount equal to the
sum of (x) the Number of Shares Deemed Outstanding immediately prior to
such Triggering Transaction plus (y) the number of shares of Common Stock
issued (or deemed to be issued in accordance with subsections 3.1(1) to
(9)) in connection with the Triggering Transaction; and
(ii) by multiplying the Purchase Price in effect immediately
prior to the time of such issue or sale by a fraction, the numerator of
which shall be the sum of (x) the Number of Shares Deemed Outstanding
immediately prior to such Triggering Transaction multiplied by the Market
Price immediately prior to such Triggering Transaction plus (y) the
consideration received by the Company upon such Triggering Transaction, and
the denominator of which shall be the product of (x) the Number of Shares
Deemed Outstanding immediately after such issue or sale, multiplied by (y)
the Market Price immediately prior to such issue or sale.
(b) For purposes of this Section 3, the term "Number of Common Shares
Deemed Outstanding" at any given time shall mean the sum of (i) the number of
shares of the Company's Common Stock
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outstanding at such time, and (ii) the number of shares of the Company's Common
Stock deemed to be outstanding under the applicable subsections 3.1(c)(1) to
(9), inclusive, at such time.
(c) For purposes of determining the adjusted Purchase Price under
this Section 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:
(1) In case the Company at any time shall in any manner
grant (whether directly or by assumption in a merger or otherwise) any
rights to subscribe for or to purchase, or any options for the
purchase of, Common Stock or any stock or other securities convertible
into or exchangeable for Common Stock (such rights or options being
herein called "Options" and such convertible or exchangeable stock or
securities being herein called "Convertible Securities"), whether or
not such Options or the right to convert or exchange any such
Convertible Securities are immediately exercisable and the price per
share for which the Common Stock is issuable upon exercise, conversion
or exchange (determined by dividing (x) the total amount, if any,
received or receivable by the Company as consideration for the
granting of such Options, plus the minimum aggregate amount of
additional consideration payable to the Company upon the exercise of
all such Options, plus, in the case of such Options which relate to
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon
the exercise of such Options or the conversion or exchange of such
Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of the granting of such Option,"
then the total maximum amount of Common Stock issuable upon the
exercise of such Options, or, in the case of Options for Convertible
Securities, upon the conversion or exchange of such Convertible
Securities, shall (as of the date of granting of such Options) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such shares of Common Stock or
such Convertible Securities upon the exercise of such Options, except
as otherwise provided in subsection (3) below.
(2) In case the Company at any time shall in any manner
issue (whether directly or by assumption in a merger or otherwise) or
sell any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per
share for which Common Stock is issuable upon such conversion or
exchange (determined by dividing (x) the total amount received or
receivable by the Company as consideration for the issue or sale of
such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (y) the total maximum number of
shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of such issue or sale, then the
total maximum number of shares of Common Stock issuable upon
conversion or exchange of all such Convertible Securities shall (as of
the date of the issue or sale of such Convertible Securities) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such Common Stock upon exercise
of the rights to exchange or convert under such Convertible
Securities, except as otherwise provided in subsection (3) below.
(3) If the purchase price provided for in any Options
referred to in subsection (1), the additional consideration, if any,
payable upon the conversion or exchange of any Convertible Securities
referred to in subsections (1) or (2), or the rate at which any
Convertible Securities referred to in subsection (1) or (2) are
convertible into or exchangeable for Common Stock shall change at any
time (other than under or by reason of provisions designed to protect
against dilution of the type set forth in Section 3.1 or 3.3), the
Purchase Price in effect at the time of such change shall forthwith be
readjusted to the Purchase Price
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which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the
case may be, at the time initially granted, issued or sold. If the
purchase price provided for in any Option referred to in subsection
(1) or the rate at which any Convertible Securities referred to in
subsections (1) or (2) are convertible into or exchangeable for Common
Stock, shall be reduced at any time under or by reason of provisions
with respect thereto designed to protect against dilution, then in
case of the delivery of Common Stock upon the exercise of any such
Option or upon conversion or exchange of any such Convertible
Security, the Purchase Price then in effect hereunder shall forthwith
be adjusted to such respective amount as would have been obtained had
such Option or Convertible Security never been issued as to such
Common Stock and had adjustments been made upon the issuance of the
shares of Common Stock delivered as aforesaid, but only if as a result
of such adjustment the Purchase Price then in effect hereunder is
hereby reduced.
(4) On the expiration of any Option or the termination of
any right to convert or exchange any Convertible Securities, the
Purchase Price then in effect hereunder shall forthwith be increased
to the Purchase Price which would have been in effect at the time of
such expiration or termination had such Option or Convertible
Securities, to the extent outstanding immediately prior to such
expiration or termination, never been issued.
(5) In case any Options shall be issued in connection with
the issue or sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options
shall be deemed (solely for the purpose of this Warrant) to have been
issued without consideration.
(6) In case any shares of Common Stock, Options or
Convertible Securities shall be issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor shall be
deemed to be the amount received by the Company therefor. In case any
shares of Common Stock, Options or Convertible Securities shall be
issued or sold for a consideration other than cash, the amount of the
consideration other than cash received by the Company shall be the
fair value of such consideration as determined in good faith by the
Board of Directors of the Company. In case any shares of Common
Stock, Options or Convertible Securities shall be issued in connection
with any merger in which the Company is the surviving corporation, the
amount of consideration therefor shall be deemed to be the fair value
of such portion of the net assets and business of the non-surviving
corporation as shall be attributed by the Board of Directors of the
Company in good faith to such Common Stock, Options or Convertible
Securities, as the case may be.
(7) The number of shares of Common Stock outstanding at any
given time shall not include shares owned or held by or for the
account of the Company, and the disposition of any shares so owned or
held shall be considered an issue or sale of Common Stock for the
purpose of this Section 3.1.
(8) In case the Company shall declare a dividend or make
any other distribution upon the stock of the Company payable in Common
Stock, Options, or Convertible Securities, then in such case any
Common Stock, Options or Convertible Securities, as the case may be,
issuable in payment of such dividend or distribution shall be deemed
to have been issued or sold without consideration.
(9) For purposes of this Section 3.1, in case the Company
shall take a record of the holders of its Common Stock for the purpose
of entitling them (x) to receive a dividend or other distribution
payable in Common Stock, Options or in Convertible Securities, or (y)
to subscribe for or purchase Common Stock, Options or Convertible
Securities, then such record date shall be deemed to be the date of
the issue or sale of the shares of Common Stock deemed
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to have been issued or sold upon the declaration of such
dividend or the making of such other distribution or the date of the
granting of such right or subscription or purchase, as the case may
be.
3.2. Dividends Not Paid Out of Earnings or Earned Surplus. In the
----------------------------------------------------
event the Company shall declare a dividend upon the Common Stock (other than a
dividend payable in Common Stock covered by subsection 3.1(8)) payable otherwise
than out of earnings or earned surplus, determined in accordance with generally
accepted accounting principles, including the making of appropriate deductions
for minority interests, if any, in subsidiaries (such amount in excess of
earnings or earned surplus herein referred to as "Liquidating Dividends"), then,
as soon as possible after the exercise of this Warrant, the Company shall pay to
the person exercising such Warrant an amount equal to the aggregate value at the
time of such exercise of all Liquidating Dividends paid from the date of
issuance of this Warrant to the date of exercise (including but not limited to
Liquidating Dividends upon Common Stock which would have been issued at the time
of such earlier exercise and upon all other securities which would have been
issued with respect to such Common Stock by reason of stock splits, stock
dividends, mergers or reorganizations, or for any other reason). For the
purposes of this Section 3.2, a dividend other than in cash shall be considered
payable out of earnings or earned surplus only to the extent that such earnings
or earned surplus are charged an amount equal to the fair value of such dividend
as determined in good faith by the Board of Directors of the Company.
3.3. Subdivisions and Combinations. In case the Company shall at any
-----------------------------
time subdivide (other than by means of a dividend payable in Common Stock
covered by subsection 3.1(8)), its outstanding shares of Common Stock into a
greater number of shares, the Purchase Price in effect immediately prior to such
subdivision shall be proportionately reduced, and, conversely, in case the
outstanding shares of Common Stock of the Company shall be combined into a
smaller number of shares, the Purchase Price in effect immediately prior to such
combination shall be proportionately increased.
3.4. Reorganization, Reclassification, Consolidation, Merger or Sale
---------------------------------------------------------------
of Assets. If any capital reorganization or reclassification of the capital
- ---------
stock of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Common Stock shall
be entitled to receive stock, securities, cash or other property with respect to
or in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder of this Warrant shall have the right to acquire
and receive upon exercise of this Warrant such shares of stock, securities, cash
or other property issuable or payable (as part of the reorganization,
reclassification, consolidation, merger or sale) with respect to or in exchange
for such number of outstanding shares of the Company's Common Stock as would
have been received upon exercise of this Warrant at the Purchase Price then in
effect. The Company will not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume by written instrument mailed or delivered to
the holder of this Warrant at the last address of such holder appearing on the
books of the Company, the obligation to deliver to such holder such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase. If a purchase, tender or exchange
offer is made to and accepted by the holders of more than 50% of the outstanding
shares of Common Stock of the Company, the Company shall not effect any
consolidation, merger or sale with the person having made such offer or with any
Affiliate of such person, unless prior to the consummation of such
consolidation, merger or sale the holder of this Warrant shall have been given a
reasonable opportunity to then elect to receive upon the exercise of this
Warrant either the stock, securities or assets then issuable with respect to the
Common Stock of the Company or the stock, securities or assets, or the
equivalent, issued to previous holders of the Common Stock in accordance with
such offer. For purposes hereof the term "Affiliate" with respect to any given
person shall mean any person controlling, controlled by or under common control
with the given person.
3.5. No Adjustment for Exercise of Certain Options, Warrants, Etc.
-------------------------------------------------------------
The provisions of this Section 3 shall not apply to any Common Stock issued,
issuable or deemed outstanding under subsections 3.1(1) to (9) inclusive: (i)
to any person pursuant to any stock option, stock purchase or similar plan or
arrangement
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<PAGE>
for the benefit of employees, consultants or directors of the Company or its
subsidiaries in effect on the date of issuance hereof, (ii) pursuant to options,
warrants and conversion rights in existence on the date of issuance hereof or
(iii) pursuant to the Exchange and Registration Rights Agreement, dated June 12,
1995, between the Company and Trump, as it may be amended from time to time (the
"Exchange Rights Agreement").
3.6. Notices of Record Date, Etc. In the event that:
---------------------------
(1) the Company shall declare any cash dividend upon its Common
Stock, or
(2) the Company shall declare any dividend upon its Common Stock
payable in stock or make any special dividend or other distribution to the
holders of its Common Stock, or
(3) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or
other rights, or
(4) there shall be any capital reorganization or reclassification
of the capital stock of the Company, including any subdivision or
combination of its outstanding shares of Common Stock, or consolidation or
merger of the Company with, or sale of all or substantially all of its
assets to, another corporation, or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in connection with such event, the Company shall give to the holder of
this Warrant:
(i) at least twenty (20) days' prior written notice of the date
on which the books of the Company shall close or a record shall be taken
for such dividend, distribution or subscription rights or for determining
rights to vote in respect of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up; and
(ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, at
least twenty (20) days' prior written notice of the date when the same
shall take place. Such notice in accordance with the foregoing clause (i)
shall also specify, in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Common Stock shall be
entitled thereto, and such notice in accordance with the foregoing clause
(ii) shall also specify the date on which the holders of Common Stock shall
be entitled to exchange their Common Stock for securities or other property
deliverable upon such reorganization, reclassification consolidation,
merger, sale, dissolution, liquidation or winding up, as the case may be.
Each such written notice shall be given by first class mail, postage
prepaid, addressed to the holder of this Warrant at the address of such
holder as shown on the books of the Company.
3.7. Grant, Issue or Sale of Options, Convertible Securities, or
-----------------------------------------------------------
Rights. If at any time or from time to time on or after the date of issuance
- ------
hereof, the Company shall grant, issue or sell any Options, Convertible
Securities or rights to purchase property (the "Purchase Rights") pro rata to
the record holders of any class of Common Stock of the Company and such grants,
issuances or sales do not result in an adjustment of the Purchase Price under
Section 3.1 hereof, then the holder of this Warrant shall be entitled to acquire
(within thirty (30) days after the later to occur of the initial exercise date
of such Purchase Rights or receipt by such holder of the notice concerning
Purchase Rights to which such holder shall be entitled under Section 3.6) and
upon the terms applicable to such Purchase Rights either:
(i) the aggregate Purchase Rights which such holder could have
acquired if it had held the number of shares of Common Stock acquirable
upon exercise of this Warrant immediately before the grant, issuance or
sale of such Purchase Rights; provided that if any Purchase Rights were
distributed to holders of Common Stock without the payment of additional
consideration by such
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<PAGE>
holders, corresponding Purchase Rights shall be distributed to the
exercising holder of this Warrant as soon as possible after such exercise
and it shall not be necessary for the exercising holder of this Warrant
specifically to request delivery of such rights; or
(ii) in the event that any such Purchase Rights shall have
expired or shall expire prior to the end of said thirty (30) day period,
the number of shares of Common Stock or the amount of property which such
holder could have acquired upon such exercise at the time or times at which
the Company granted, issued or sold such expired Purchase Rights.
3.8. Adjustment by Board of Directors. If any event occurs as to
--------------------------------
which, in the opinion of the Board of Directors of the Company, the provisions
of this Section 3 are not strictly applicable or if strictly applicable would
not fairly protect the rights of the holder of this Warrant in accordance with
the essential intent and principles of such provisions, then the Board of
Directors shall make an adjustment in the application of such provisions, in
accordance with such essential intent and principles, so as to protect such
rights as aforesaid, but in no event shall any adjustment have the effect of
increasing the Purchase Price as otherwise determined pursuant to any of the
provisions of this Section 3 except in the case of a combination of shares of a
type contemplated in Section 3.3 and then in no event to an amount larger than
the Purchase Price as adjusted pursuant to Section 3.3.
3.9. Fractional Shares. The Company shall not issue fractions of
-----------------
shares of Common Stock upon exercise of this Warrant or scrip in lieu thereof.
If any fraction of a share of Common Stock would, except for the provisions of
this Section 3.9, be issuable upon exercise of this Warrant, the Company shall
in lieu thereof pay to the person entitled thereto an amount in cash equal to
the current value of such fraction, calculated to the nearest one-hundredth
(1/100) of a share, to be computed (i) if the Common Stock is listed on any
national securities exchange on the basis of the last sales price of the Common
Stock on such exchange (or the quoted closing bid price if there shall have been
no sales) on the date of conversion, or (ii) if the Common Stock shall not be
listed, on the basis of the mean between the closing bid and asked prices for
the Common Stock on the date of conversion as reported by NASDAQ, or its
successor, and if there are not such closing bid and asked prices, on the basis
of the fair market value per share as determined by the Board of Directors of
the Company.
3.10. Officers' Statement as to Adjustments. Whenever the Purchase
-------------------------------------
Price shall be adjusted as provided in Section 3 hereof, the Company shall
forthwith file at each office designated for the exercise of this Warrant, a
statement, signed by the Chairman of the Board, the President, any Vice
President or Treasurer of the Company, showing in reasonable detail the facts
requiring such adjustment and the Purchase Price that will be effective after
such adjustment. The Company shall also cause a notice setting forth any such
adjustments to be sent by mail, first class, postage prepaid, to the record
holder of this Warrant at his or its address appearing on the stock register.
If such notice relates to an adjustment resulting from an event referred to in
Section 3.6, such notice shall be included as part of the notice required to be
mailed and published under the provisions of Section 3.6 hereof.
4. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of
its charter or through reorganization, consolidation, merger, dissolution, sale
of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the holder hereof against dilution or other impairment. Without limiting the
generality of the foregoing, the Company will not increase the par value of any
shares of stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and at all times will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable stock upon the exercise of this
Warrant.
5. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company shall at all times reserve and keep available out of its authorized but
unissued stock, solely for the
7
<PAGE>
issuance and delivery upon the exercise of this Warrant and other similar
Warrants, such number of its duly authorized shares of Common Stock as from time
to time shall be issuable upon the exercise of this Warrant and all other
similar Warrants at the time outstanding.
6. REGISTRATION RIGHTS. The holder of this warrant shall have the
following registration rights with respect to the Common Stock:
6.1. Registration on Demand. (a) Upon written notice to the Company
----------------------
from holders of at least twenty-five percent (25%) of the Registrable Securities
(as hereinafter defined), determined as if the Warrant 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 Securities and Exchange
Commission (the "SEC") a registration statement on the appropriate form covering
all Registrable Securities specified in such demand and by such 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 two (2) registrations pursuant to this Section 6.1. The
Company shall be obligated to effect any registration pursuant to this Section
6.1 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 6.1 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. For
purposes hereof, the term "Registrable Securities" shall mean, collectively, (i)
the Common Stock issued or issuable upon exercise of the Warrant 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.
(b) The Company will be obligated to pay all Registration Expenses
with respect to the registrations pursuant to this Section 6.1.
(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) they 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 Actor any similar state law then
in force, or (iii) they shall have ceased to be outstanding.
(d) A registration requested pursuant to this Section 6.1 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 Warrant with
respect thereto (without regard to the use of best 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 (as hereinafter defined). If (i)
a registration requested pursuant to this Section 6.1 is deemed not to have been
effected or (ii) the registration requested pursuant to this
8
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Section 6.1 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 6.1 and (y) such requested registration
shall not reduce the number of registrations the Company shall be obligated to
effect pursuant to this Section 6.1. For the purposes hereof, the term "Stop
Order" shall mean, with respect to any registration of the Registrable
Securities or any portion thereof effected pursuant to this Warrant, 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.
(e) Any offering of Registrable Securities contemplated by this
Section 6.1 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 6.1, 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
subsection 6.1(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 underwriter in a public offering to be effected pursuant
to the provisions of this Section 6.1 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, registration together with any other securities to be included
in such, have a value, based on the proposed offering price, of less than
$2,000,000.
6.2. 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 (as hereinafter defined) of such registration. For
the purposes hereof, the term "Registration Expenses" shall mean 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.
(b) The Company may in its discretion withdraw any registration
statement filed pursuant to this Section 6.2 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 6.2 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
9
<PAGE>
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).
6.3. Indemnity and Contribution. (a) In connection with a
--------------------------
registration statement filed with the SEC pursuant to this Section 6, the
Company shall provide each holder of Registrable Securities included in such
registration statement, and 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 Securities Exchange Act of 1934 (the
"Exchange Act") , with indemnification against any losses, claims, damages or
liabilities, reasonable attorneys 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, and 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 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 subsection 6.3(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 shall contribute to the aggregate Damages
contemplated by said indemnity agreement incurred by each of the Company and the
holders of the Registrable Securities, as incurred, in such proportions as is
appropriate to reflect the relative fault of the Company and the holders of the
Registrable Securities in connection with the statements or omissions which
resulted in such Damages. The relative fault of the Company on one hand and the
holders of the Registrable Securities on the other 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 on one hand and the holders of the
Registrable Securities on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(c) In no event shall a holder of Registrable Securities be liable
for indemnification or contribution pursuant to this Section 6 in excess of the
net proceeds received upon the sale of such Registrable Securities.
6.4. Certain Procedures. The Company shall provide each holder of
------------------
Registrable Securities included in any registration with (i) 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
(ii) 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.
10
<PAGE>
6.5. 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:
(1) 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");
(2) 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
(3) 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.
6.6. Lock-Ups. After receipt of any notice pursuant to Section 6.1
--------
or 6.2 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 the Company described in
this Section 6, 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. Nothing in this Section 6.6 shall preclude the Company from issuing
shares of Registrable Securities upon exercise of the Warrant.
6.7. 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 or entity 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 Warrant, except pursuant to the
Exchange Rights Agreement.
7. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of
like tenor.
8. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that the same may be specifically enforced.
9. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which each taker or owner hereof consents and agrees:
(a) Subject to the legend appearing on the first page hereof,
title to this Warrant may be transferred by endorsement (by the holder
hereof executing the form of assignment at the end hereof including
guaranty of signature) and delivery in the same manner as in the case of a
negotiable instrument transferable by endorsement and delivery.
11
<PAGE>
(b) Any person in possession of this Warrant properly endorsed
is authorized to represent himself as absolute owner hereof and is granted
power to transfer absolute title hereto by endorsement and delivery hereof
to a bona fide purchaser hereof for value; each prior taker or owner waives
and renounces all of his equities or rights in this Warrant in favor of
every such bona fide purchaser, and every such bona fide purchaser shall
acquire title hereto and to all rights represented hereby.
(c) Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder of this Warrant as the
absolute owner hereof for all purposes without being affected by any notice
to the contrary.
(d) Prior to the exercise of this Warrant, the holder hereof
shall not be entitled to any rights of a shareholder of the Company with
respect to shares for which this Warrant shall be exercisable, including,
without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be
entitled to receive any notice of any proceedings of the Company, except as
provided herein.
(e) The Company shall not be required to pay any Federal or
state transfer tax or charge that may be payable in respect of any transfer
involved in the transfer or delivery of this Warrant or the issuance or
conversion or delivery of certificates for Common Stock in a name other
than that of the registered holder of this Warrant or to issue or deliver
any certificates for Common Stock upon the exercise of this Warrant until
any and all such taxes and charges shall have been paid by the holder of
this Warrant or until it has been established to the Company's satisfaction
that no such tax or charge is due.
10. SUBDIVISION OF RIGHTS. This Warrant (as well as any new warrants
issued pursuant to the provisions of this Section) is exchangeable, upon the
surrender hereof by the holder hereof, at the principal office of the Company
for any number of new warrants of like tenor and date representing in the
aggregate the right to subscribe for and purchase the number of shares of Common
Stock of the Company which may be subscribed for and purchased hereunder.
11. MAILING OF NOTICES, ETC. All notices and other communications
from the Company to the holder of this Warrant shall be mailed by first-class
certified mail, postage prepaid, to the address furnished to the Company in
writing by the last holder of this Warrant who shall have furnished an address
to the Company in writing.
12. HEADINGS, ETC. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect the meaning hereof.
13. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof
may be changed, waived, discharged or terminated orally but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
14. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
12
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed and
delivered this Warrant as of this 17th day of April, 1996.
--
TRUMP HOTELS & CASINO RESORTS, INC.
By: /s/
--------------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
Attest:
/s/
- -----------------------------
Name: Robert M. Pickus
Title: Executive Vice President
and Secretary
13
<PAGE>
WARRANT EXERCISE FORM
To: Trump Hotels & Casino Resorts, Inc.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _____________ shares of Common Stock of Trump Hotels &
Casino Resorts, Inc. and herewith makes payment of $ _____________ therefor,
and requests that the certificates for such shares be issued in the name of, and
be delivered to ______________, whose address is _______________________.
Dated:
________________________
<PAGE>
TRANSFER OF WARRANT FORM
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _____________________ the right represented by the within Warrant
to purchase the ________ shares of the Common Stock of Trump Hotels & Casino
Resorts, Inc. to which the within Warrant relates, and appoints
______________ attorney to transfer said right on the books of Trump Hotels &
Casino Resorts, Inc. with full power of substitution in the premises.
Dated:
________________________
In the presence of
_________________________
0094887.04
<PAGE>
Warrant No. W-002
WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION UNDER
THE SECURITIES ACT OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL
REASONABLY SATISFACTORY TO TRUMP HOTELS & CASINO RESORTS, INC., QUALIFIES AS AN
EXEMPT TRANSACTION UNDER THE SECURITIES ACT AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER.
TRUMP HOTELS & CASINO RESORTS, INC.
COMMON STOCK PURCHASE WARRANT
TRUMP HOTELS & CASINO RESORTS, INC., a Delaware corporation (the
"Company"), hereby certifies that, for value received, DONALD J. TRUMP
("Trump"), or his assigns, is entitled, subject to the terms set forth below, to
purchase from the Company, at any time and from time to time during the period
beginning on April 17, 1996 and ending on April 17, 2000 in whole or in part, an
aggregate of six hundred thousand (600,000) fully paid and non-assessable shares
of the Common Stock of the Company, par value $ .01 per share, at a purchase
price, subject to the provisions of Section 3 hereof, of $35.00 per share (the
"Purchase Price"). The Purchase Price and the number and character of such
shares are subject to adjustment as provided below, and the term "Common Stock"
shall mean, unless the context otherwise requires, the stock or other securities
or property at the time deliverable upon the exercise of this Warrant. This
Warrant is herein called the "Warrant."
1. EXERCISE OF WARRANT. The purchase rights evidenced by this
Warrant shall be exercised by the holder surrendering this Warrant, with the
form of subscription at the end hereof duly executed by such holder, to the
Company at its office in Atlantic City, New Jersey, accompanied by payment, of
an amount (the "Exercise Amount") equal to the Purchase Price multiplied by the
number of shares being purchased pursuant to such exercise, payable as follows:
(i) by payment to the Company in cash, by certified or official bank check, or
by wire transfer of the Exercise Amount, (ii) by surrender to the Company for
cancellation of securities of the Company having a Market Price (as hereinafter
defined) on the date of exercise equal to the Exercise Amount; or (c) by a
combination of the methods described in clauses (a) and (b) above. In lieu of
exercising the Warrant, the holder may elect to receive a payment equal to the
difference between (i) the Market Price multiplied by the number of shares as to
which the payment is then being elected and (ii) the exercise price with respect
to such shares, payable by the Company to the holder of this Warrant only in
shares of Common Stock valued at the Market Price on the date of exercise. For
purposes hereof, the term "Market Price" shall mean the average high and low
sale price of a share of Common Stock for the 15 consecutive trading days
preceding such day on the principal national securities exchange on which the
shares of Common Stock or securities are listed or admitted to trading or, if
not listed or admitted to trading on any national securities exchange, the
average of the reported bid and asked prices during such 15 trading day period
in the over-the-counter market as furnished by the National Quotation Bureau,
Inc., or, if such firm is not then engaged in the business of reporting such
prices, as furnished by any member of the National Association of Securities
Dealers, Inc. selected by the Company or, if the shares of Common Stock or
securities are not publicly traded, the Market Price for such day shall be the
fair market value thereof determined jointly by the Company and the holder of
this Warrant; provided, however, that if such parties are unable to reach
agreement within a reasonable period of time, the Market Price shall be
determined in good faith by the independent investment banking firm selected
jointly by the Company and the holder of this Warrant or, if that selection
cannot be made within 15 days, by an independent investment banking firm
selected by the American Arbitration Association in accordance with its rules.
<PAGE>
1.1 Partial Exercise. This Warrant may be exercised for less than
----------------
the full number of shares of Common Stock, in which case the number of shares
receivable upon the exercise of this Warrant as a whole, and the sum payable
upon the exercise of this Warrant as a whole, shall be proportionately reduced.
Upon any such partial exercise, the Company at its expense will forthwith issue
to the holder hereof a new Warrant or Warrants of like tenor calling for the
number of shares of Common Stock as to which rights have not been exercised,
such Warrant or Warrants to be issued in the name of the holder hereof or his
nominee (upon payment by such holder of any applicable transfer taxes).
2. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as
practicable after the exercise of this Warrant and payment of the Purchase
Price, and in any event within ten (10) days thereafter, the Company, at its
expense, will cause to be issued in the name of and delivered to the holder
hereof a certificate or certificates for the number of fully paid and non-
assessable shares or other securities or property to which such holder shall be
entitled upon such exercise, plus, in lieu of any fractional share to which such
holder would otherwise be entitled, cash in an amount determined in accordance
with Section 3.9 hereof. The Company agrees that the shares so purchased shall
be deemed to be issued to the holder hereof as the record owner of such shares
as of the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid.
3. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS. In order to
prevent dilution of the right granted hereunder, the Purchase Price shall be
subject to adjustment from time to time in accordance with this Section 3. Upon
each adjustment of the Purchase Price pursuant to this Section 3, the registered
holder of this Warrant shall thereafter be entitled to acquire upon exercise, at
the Purchase Price resulting from such adjustment, the number of shares of the
Company's Common Stock obtainable by multiplying the Purchase Price in effect
immediately prior to such adjustment by the number of shares of the Company's
Common Stock acquirable immediately prior to such adjustment and dividing the
product thereof by the Purchase Price resulting from such adjustment.
3.1. Adjustment for Issue or Sale of Common Stock at less than Market
----------------------------------------------------------------
Price. (a) Except as provided in Section 3.2 or 3.5 below, if and whenever on
- -----
or after the date of issuance hereof the Company shall issue or sell, or shall
in accordance with subsections 3.1(c)(1) to (9), inclusive, be deemed to have
issued or sold, any shares of its Common Stock for a consideration per share
less than the Market Price in effect immediately prior to the time of such issue
or sale, then forthwith upon such issue or sale (the "Triggering Transaction"),
the Purchase Price shall, subject to subsections (1) to (9) of Section 3.1(c),
be reduced to the lower of the prices (calculated to the nearest tenth of a
cent) determined as follows:
(i) by dividing (a) an amount equal to the sum of (x) the product
derived by multiplying the Number of Common Shares Deemed Outstanding
immediately prior to such Triggering Transaction by the Purchase Price then
in effect, plus (y) the consideration, if any, received by the Company upon
consummation of such Triggering Transaction, by (b) an amount equal to the
sum of (x) the Number of Shares Deemed Outstanding immediately prior to
such Triggering Transaction plus (y) the number of shares of Common Stock
issued (or deemed to be issued in accordance with subsections 3.1(1) to
(9)) in connection with the Triggering Transaction; and
(ii) by multiplying the Purchase Price in effect immediately
prior to the time of such issue or sale by a fraction, the numerator of
which shall be the sum of (x) the Number of Shares Deemed Outstanding
immediately prior to such Triggering Transaction multiplied by the Market
Price immediately prior to such Triggering Transaction plus (y) the
consideration received by the Company upon such Triggering Transaction, and
the denominator of which shall be the product of (x) the Number of Shares
Deemed Outstanding immediately after such issue or sale, multiplied by (y)
the Market Price immediately prior to such issue or sale.
(b) For purposes of this Section 3, the term "Number of Common Shares
Deemed Outstanding" at any given time shall mean the sum of (i) the number of
shares of the Company's Common Stock
2
<PAGE>
outstanding at such time, and (ii) the number of shares of the Company's Common
Stock deemed to be outstanding under the applicable subsections 3.1(c)(1) to
(9), inclusive, at such time.
(c) For purposes of determining the adjusted Purchase Price under
this Section 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:
(1) In case the Company at any time shall in any manner
grant (whether directly or by assumption in a merger or otherwise) any
rights to subscribe for or to purchase, or any options for the
purchase of, Common Stock or any stock or other securities convertible
into or exchangeable for Common Stock (such rights or options being
herein called "Options" and such convertible or exchangeable stock or
securities being herein called "Convertible Securities"), whether or
not such Options or the right to convert or exchange any such
Convertible Securities are immediately exercisable and the price per
share for which the Common Stock is issuable upon exercise, conversion
or exchange (determined by dividing (x) the total amount, if any,
received or receivable by the Company as consideration for the
granting of such Options, plus the minimum aggregate amount of
additional consideration payable to the Company upon the exercise of
all such Options, plus, in the case of such Options which relate to
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon
the exercise of such Options or the conversion or exchange of such
Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of the granting of such Option,"
then the total maximum amount of Common Stock issuable upon the
exercise of such Options, or, in the case of Options for Convertible
Securities, upon the conversion or exchange of such Convertible
Securities, shall (as of the date of granting of such Options) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such shares of Common Stock or
such Convertible Securities upon the exercise of such Options, except
as otherwise provided in subsection (3) below.
(2) In case the Company at any time shall in any manner
issue (whether directly or by assumption in a merger or otherwise) or
sell any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per
share for which Common Stock is issuable upon such conversion or
exchange (determined by dividing (x) the total amount received or
receivable by the Company as consideration for the issue or sale of
such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (y) the total maximum number of
shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of such issue or sale, then the
total maximum number of shares of Common Stock issuable upon
conversion or exchange of all such Convertible Securities shall (as of
the date of the issue or sale of such Convertible Securities) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such Common Stock upon exercise
of the rights to exchange or convert under such Convertible
Securities, except as otherwise provided in subsection (3) below.
(3) If the purchase price provided for in any Options
referred to in subsection (1), the additional consideration, if any,
payable upon the conversion or exchange of any Convertible Securities
referred to in subsections (1) or (2), or the rate at which any
Convertible Securities referred to in subsection (1) or (2) are
convertible into or exchangeable for Common Stock shall change at any
time (other than under or by reason of provisions designed to protect
against dilution of the type set forth in Section 3.1 or 3.3), the
Purchase Price in effect at the time of such change shall forthwith be
readjusted to the Purchase Price
3
<PAGE>
which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the
case may be, at the time initially granted, issued or sold. If the
purchase price provided for in any Option referred to in subsection
(1) or the rate at which any Convertible Securities referred to in
subsections (1) or (2) are convertible into or exchangeable for Common
Stock, shall be reduced at any time under or by reason of provisions
with respect thereto designed to protect against dilution, then in
case of the delivery of Common Stock upon the exercise of any such
Option or upon conversion or exchange of any such Convertible
Security, the Purchase Price then in effect hereunder shall forthwith
be adjusted to such respective amount as would have been obtained had
such Option or Convertible Security never been issued as to such
Common Stock and had adjustments been made upon the issuance of the
shares of Common Stock delivered as aforesaid, but only if as a result
of such adjustment the Purchase Price then in effect hereunder is
hereby reduced.
(4) On the expiration of any Option or the termination of
any right to convert or exchange any Convertible Securities, the
Purchase Price then in effect hereunder shall forthwith be increased
to the Purchase Price which would have been in effect at the time of
such expiration or termination had such Option or Convertible
Securities, to the extent outstanding immediately prior to such
expiration or termination, never been issued.
(5) In case any Options shall be issued in connection with
the issue or sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options
shall be deemed (solely for the purpose of this Warrant) to have been
issued without consideration.
(6) In case any shares of Common Stock, Options or
Convertible Securities shall be issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor shall be
deemed to be the amount received by the Company therefor. In case any
shares of Common Stock, Options or Convertible Securities shall be
issued or sold for a consideration other than cash, the amount of the
consideration other than cash received by the Company shall be the
fair value of such consideration as determined in good faith by the
Board of Directors of the Company. In case any shares of Common
Stock, Options or Convertible Securities shall be issued in connection
with any merger in which the Company is the surviving corporation, the
amount of consideration therefor shall be deemed to be the fair value
of such portion of the net assets and business of the non-surviving
corporation as shall be attributed by the Board of Directors of the
Company in good faith to such Common Stock, Options or Convertible
Securities, as the case may be.
(7) The number of shares of Common Stock outstanding at any
given time shall not include shares owned or held by or for the
account of the Company, and the disposition of any shares so owned or
held shall be considered an issue or sale of Common Stock for the
purpose of this Section 3.1.
(8) In case the Company shall declare a dividend or make
any other distribution upon the stock of the Company payable in Common
Stock, Options, or Convertible Securities, then in such case any
Common Stock, Options or Convertible Securities, as the case may be,
issuable in payment of such dividend or distribution shall be deemed
to have been issued or sold without consideration.
(9) For purposes of this Section 3.1, in case the Company
shall take a record of the holders of its Common Stock for the purpose
of entitling them (x) to receive a dividend or other distribution
payable in Common Stock, Options or in Convertible Securities, or (y)
to subscribe for or purchase Common Stock, Options or Convertible
Securities, then such record date shall be deemed to be the date of
the issue or sale of the shares of Common Stock deemed
4
<PAGE>
to have been issued or sold upon the declaration of such dividend or
the making of such other distribution or the date of the granting of
such right or subscription or purchase, as the case may be.
3.2. Dividends Not Paid Out of Earnings or Earned Surplus. In the
----------------------------------------------------
event the Company shall declare a dividend upon the Common Stock (other than a
dividend payable in Common Stock covered by subsection 3.1(8)) payable otherwise
than out of earnings or earned surplus, determined in accordance with generally
accepted accounting principles, including the making of appropriate deductions
for minority interests, if any, in subsidiaries (such amount in excess of
earnings or earned surplus herein referred to as "Liquidating Dividends"), then,
as soon as possible after the exercise of this Warrant, the Company shall pay to
the person exercising such Warrant an amount equal to the aggregate value at the
time of such exercise of all Liquidating Dividends paid from the date of
issuance of this Warrant to the date of exercise (including but not limited to
Liquidating Dividends upon Common Stock which would have been issued at the time
of such earlier exercise and upon all other securities which would have been
issued with respect to such Common Stock by reason of stock splits, stock
dividends, mergers or reorganizations, or for any other reason). For the
purposes of this Section 3.2, a dividend other than in cash shall be considered
payable out of earnings or earned surplus only to the extent that such earnings
or earned surplus are charged an amount equal to the fair value of such dividend
as determined in good faith by the Board of Directors of the Company.
3.3. Subdivisions and Combinations. In case the Company shall at any
-----------------------------
time subdivide (other than by means of a dividend payable in Common Stock
covered by subsection 3.1(8)), its outstanding shares of Common Stock into a
greater number of shares, the Purchase Price in effect immediately prior to such
subdivision shall be proportionately reduced, and, conversely, in case the
outstanding shares of Common Stock of the Company shall be combined into a
smaller number of shares, the Purchase Price in effect immediately prior to such
combination shall be proportionately increased.
3.4. Reorganization, Reclassification, Consolidation, Merger or Sale
---------------------------------------------------------------
of Assets. If any capital reorganization or reclassification of the capital
- ---------
stock of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Common Stock shall
be entitled to receive stock, securities, cash or other property with respect to
or in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder of this Warrant shall have the right to acquire
and receive upon exercise of this Warrant such shares of stock, securities, cash
or other property issuable or payable (as part of the reorganization,
reclassification, consolidation, merger or sale) with respect to or in exchange
for such number of outstanding shares of the Company's Common Stock as would
have been received upon exercise of this Warrant at the Purchase Price then in
effect. The Company will not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume by written instrument mailed or delivered to
the holder of this Warrant at the last address of such holder appearing on the
books of the Company, the obligation to deliver to such holder such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase. If a purchase, tender or exchange
offer is made to and accepted by the holders of more than 50% of the outstanding
shares of Common Stock of the Company, the Company shall not effect any
consolidation, merger or sale with the person having made such offer or with any
Affiliate of such person, unless prior to the consummation of such
consolidation, merger or sale the holder of this Warrant shall have been given a
reasonable opportunity to then elect to receive upon the exercise of this
Warrant either the stock, securities or assets then issuable with respect to the
Common Stock of the Company or the stock, securities or assets, or the
equivalent, issued to previous holders of the Common Stock in accordance with
such offer. For purposes hereof the term "Affiliate" with respect to any given
person shall mean any person controlling, controlled by or under common control
with the given person.
3.5. No Adjustment for Exercise of Certain Options, Warrants, Etc.
-------------------------------------------------------------
The provisions of this Section 3 shall not apply to any Common Stock issued,
issuable or deemed outstanding under subsections 3.1(1) to (9) inclusive: (i)
to any person pursuant to any stock option, stock purchase or similar plan or
arrangement
5
<PAGE>
for the benefit of employees, consultants or directors of the Company or its
subsidiaries in effect on the date of issuance hereof, (ii) pursuant to options,
warrants and conversion rights in existence on the date of issuance hereof or
(iii) pursuant to the Exchange and Registration Rights Agreement, dated June 12,
1995, between the Company and Trump, as it may be amended from time to time (the
"Exchange Rights Agreement").
3.6. Notices of Record Date, Etc. In the event that:
---------------------------
(1) the Company shall declare any cash dividend upon its Common
Stock, or
(2) the Company shall declare any dividend upon its Common Stock
payable in stock or make any special dividend or other distribution to the
holders of its Common Stock, or
(3) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or
other rights, or
(4) there shall be any capital reorganization or reclassification
of the capital stock of the Company, including any subdivision or
combination of its outstanding shares of Common Stock, or consolidation or
merger of the Company with, or sale of all or substantially all of its
assets to, another corporation, or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in connection with such event, the Company shall give to the holder of
this Warrant:
(i) at least twenty (20) days' prior written notice of the date
on which the books of the Company shall close or a record shall be taken
for such dividend, distribution or subscription rights or for determining
rights to vote in respect of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up; and
(ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, at
least twenty (20) days' prior written notice of the date when the same
shall take place. Such notice in accordance with the foregoing clause (i)
shall also specify, in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Common Stock shall be
entitled thereto, and such notice in accordance with the foregoing clause
(ii) shall also specify the date on which the holders of Common Stock shall
be entitled to exchange their Common Stock for securities or other property
deliverable upon such reorganization, reclassification consolidation,
merger, sale, dissolution, liquidation or winding up, as the case may be.
Each such written notice shall be given by first class mail, postage
prepaid, addressed to the holder of this Warrant at the address of such
holder as shown on the books of the Company.
3.7. Grant, Issue or Sale of Options, Convertible Securities, or
-----------------------------------------------------------
Rights. If at any time or from time to time on or after the date of issuance
- ------
hereof, the Company shall grant, issue or sell any Options, Convertible
Securities or rights to purchase property (the "Purchase Rights") pro rata to
the record holders of any class of Common Stock of the Company and such grants,
issuances or sales do not result in an adjustment of the Purchase Price under
Section 3.1 hereof, then the holder of this Warrant shall be entitled to acquire
(within thirty (30) days after the later to occur of the initial exercise date
of such Purchase Rights or receipt by such holder of the notice concerning
Purchase Rights to which such holder shall be entitled under Section 3.6) and
upon the terms applicable to such Purchase Rights either:
(i) the aggregate Purchase Rights which such holder could have
acquired if it had held the number of shares of Common Stock acquirable
upon exercise of this Warrant immediately before the grant, issuance or
sale of such Purchase Rights; provided that if any Purchase Rights were
distributed to holders of Common Stock without the payment of additional
consideration by such
6
<PAGE>
holders, corresponding Purchase Rights shall be distributed to the
exercising holder of this Warrant as soon as possible after such exercise
and it shall not be necessary for the exercising holder of this Warrant
specifically to request delivery of such rights; or
(ii) in the event that any such Purchase Rights shall have
expired or shall expire prior to the end of said thirty (30) day period,
the number of shares of Common Stock or the amount of property which such
holder could have acquired upon such exercise at the time or times at which
the Company granted, issued or sold such expired Purchase Rights.
3.8. Adjustment by Board of Directors. If any event occurs as to
--------------------------------
which, in the opinion of the Board of Directors of the Company, the provisions
of this Section 3 are not strictly applicable or if strictly applicable would
not fairly protect the rights of the holder of this Warrant in accordance with
the essential intent and principles of such provisions, then the Board of
Directors shall make an adjustment in the application of such provisions, in
accordance with such essential intent and principles, so as to protect such
rights as aforesaid, but in no event shall any adjustment have the effect of
increasing the Purchase Price as otherwise determined pursuant to any of the
provisions of this Section 3 except in the case of a combination of shares of a
type contemplated in Section 3.3 and then in no event to an amount larger than
the Purchase Price as adjusted pursuant to Section 3.3.
3.9. Fractional Shares. The Company shall not issue fractions of
-----------------
shares of Common Stock upon exercise of this Warrant or scrip in lieu thereof.
If any fraction of a share of Common Stock would, except for the provisions of
this Section 3.9, be issuable upon exercise of this Warrant, the Company shall
in lieu thereof pay to the person entitled thereto an amount in cash equal to
the current value of such fraction, calculated to the nearest one-hundredth
(1/100) of a share, to be computed (i) if the Common Stock is listed on any
national securities exchange on the basis of the last sales price of the Common
Stock on such exchange (or the quoted closing bid price if there shall have been
no sales) on the date of conversion, or (ii) if the Common Stock shall not be
listed, on the basis of the mean between the closing bid and asked prices for
the Common Stock on the date of conversion as reported by NASDAQ, or its
successor, and if there are not such closing bid and asked prices, on the basis
of the fair market value per share as determined by the Board of Directors of
the Company.
3.10. Officers' Statement as to Adjustments. Whenever the Purchase
-------------------------------------
Price shall be adjusted as provided in Section 3 hereof, the Company shall
forthwith file at each office designated for the exercise of this Warrant, a
statement, signed by the Chairman of the Board, the President, any Vice
President or Treasurer of the Company, showing in reasonable detail the facts
requiring such adjustment and the Purchase Price that will be effective after
such adjustment. The Company shall also cause a notice setting forth any such
adjustments to be sent by mail, first class, postage prepaid, to the record
holder of this Warrant at his or its address appearing on the stock register.
If such notice relates to an adjustment resulting from an event referred to in
Section 3.6, such notice shall be included as part of the notice required to be
mailed and published under the provisions of Section 3.6 hereof.
4. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of
its charter or through reorganization, consolidation, merger, dissolution, sale
of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the holder hereof against dilution or other impairment. Without limiting the
generality of the foregoing, the Company will not increase the par value of any
shares of stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and at all times will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable stock upon the exercise of this
Warrant.
5. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company shall at all times reserve and keep available out of its authorized but
unissued stock, solely for the
7
<PAGE>
issuance and delivery upon the exercise of this Warrant and other similar
Warrants, such number of its duly authorized shares of Common Stock as from time
to time shall be issuable upon the exercise of this Warrant and all other
similar Warrants at the time outstanding.
6. REGISTRATION RIGHTS. The holder of this warrant shall have the
following registration rights with respect to the Common Stock:
6.1. Registration on Demand. (a) Upon written notice to the Company
----------------------
from holders of at least twenty-five percent (25%) of the Registrable Securities
(as hereinafter defined), determined as if the Warrant 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 Securities and Exchange
Commission (the "SEC") a registration statement on the appropriate form covering
all Registrable Securities specified in such demand and by such 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 two (2) registrations pursuant to this Section 6.1. The
Company shall be obligated to effect any registration pursuant to this Section
6.1 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 6.1 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. For
purposes hereof, the term "Registrable Securities" shall mean, collectively, (i)
the Common Stock issued or issuable upon exercise of the Warrant 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.
(b) The Company will be obligated to pay all Registration Expenses
with respect to the registrations pursuant to this Section 6.1.
(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) they 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 Actor any similar state law then
in force, or (iii) they shall have ceased to be outstanding.
(d) A registration requested pursuant to this Section 6.1 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 Warrant with
respect thereto (without regard to the use of best 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 (as hereinafter defined). If (i)
a registration requested pursuant to this Section 6.1 is deemed not to have been
effected or (ii) the registration requested pursuant to this
8
<PAGE>
Section 6.1 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 6.1 and (y) such requested registration
shall not reduce the number of registrations the Company shall be obligated to
effect pursuant to this Section 6.1. For the purposes hereof, the term "Stop
Order" shall mean, with respect to any registration of the Registrable
Securities or any portion thereof effected pursuant to this Warrant, 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.
(e) Any offering of Registrable Securities contemplated by this
Section 6.1 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 6.1, 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
subsection 6.1(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 underwriter in a public offering to be effected pursuant
to the provisions of this Section 6.1 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, registration together with any other securities to be included
in such, have a value, based on the proposed offering price, of less than
$2,000,000.
6.2. 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 (as hereinafter defined) of such registration. For
the purposes hereof, the term "Registration Expenses" shall mean 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.
(b) The Company may in its discretion withdraw any registration
statement filed pursuant to this Section 6.2 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 6.2 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
9
<PAGE>
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).
6.3. Indemnity and Contribution. (a) In connection with a
--------------------------
registration statement filed with the SEC pursuant to this Section 6, the
Company shall provide each holder of Registrable Securities included in such
registration statement, and 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 Securities Exchange Act of 1934 (the
"Exchange Act") , with indemnification against any losses, claims, damages or
liabilities, reasonable attorneys 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, and 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 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 subsection 6.3(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 shall contribute to the aggregate Damages
contemplated by said indemnity agreement incurred by each of the Company and the
holders of the Registrable Securities, as incurred, in such proportions as is
appropriate to reflect the relative fault of the Company and the holders of the
Registrable Securities in connection with the statements or omissions which
resulted in such Damages. The relative fault of the Company on one hand and the
holders of the Registrable Securities on the other 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 on one hand and the holders of the
Registrable Securities on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(c) In no event shall a holder of Registrable Securities be liable
for indemnification or contribution pursuant to this Section 6 in excess of the
net proceeds received upon the sale of such Registrable Securities.
6.4. Certain Procedures. The Company shall provide each holder of
------------------
Registrable Securities included in any registration with (i) 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
(ii) 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.
10
<PAGE>
6.5. 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:
(1) 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");
(2) 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
(3) 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.
6.6. Lock-Ups. After receipt of any notice pursuant to Section 6.1
--------
or 6.2 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 the Company described in
this Section 6, 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. Nothing in this Section 6.6 shall preclude the Company from issuing
shares of Registrable Securities upon exercise of the Warrant.
6.7. 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 or entity 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 Warrant, except pursuant to the
Exchange Rights Agreement.
7. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of
like tenor.
8. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that the same may be specifically enforced.
9. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which each taker or owner hereof consents and agrees:
(a) Subject to the legend appearing on the first page hereof,
title to this Warrant may be transferred by endorsement (by the holder
hereof executing the form of assignment at the end hereof including
guaranty of signature) and delivery in the same manner as in the case of a
negotiable instrument transferable by endorsement and delivery.
11
<PAGE>
(b) Any person in possession of this Warrant properly endorsed
is authorized to represent himself as absolute owner hereof and is granted
power to transfer absolute title hereto by endorsement and delivery hereof
to a bona fide purchaser hereof for value; each prior taker or owner waives
and renounces all of his equities or rights in this Warrant in favor of
every such bona fide purchaser, and every such bona fide purchaser shall
acquire title hereto and to all rights represented hereby.
(c) Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder of this Warrant as the
absolute owner hereof for all purposes without being affected by any notice
to the contrary.
(d) Prior to the exercise of this Warrant, the holder hereof
shall not be entitled to any rights of a shareholder of the Company with
respect to shares for which this Warrant shall be exercisable, including,
without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be
entitled to receive any notice of any proceedings of the Company, except as
provided herein.
(e) The Company shall not be required to pay any Federal or
state transfer tax or charge that may be payable in respect of any transfer
involved in the transfer or delivery of this Warrant or the issuance or
conversion or delivery of certificates for Common Stock in a name other
than that of the registered holder of this Warrant or to issue or deliver
any certificates for Common Stock upon the exercise of this Warrant until
any and all such taxes and charges shall have been paid by the holder of
this Warrant or until it has been established to the Company's satisfaction
that no such tax or charge is due.
10. SUBDIVISION OF RIGHTS. This Warrant (as well as any new warrants
issued pursuant to the provisions of this Section) is exchangeable, upon the
surrender hereof by the holder hereof, at the principal office of the Company
for any number of new warrants of like tenor and date representing in the
aggregate the right to subscribe for and purchase the number of shares of Common
Stock of the Company which may be subscribed for and purchased hereunder.
11. MAILING OF NOTICES, ETC. All notices and other communications
from the Company to the holder of this Warrant shall be mailed by first-class
certified mail, postage prepaid, to the address furnished to the Company in
writing by the last holder of this Warrant who shall have furnished an address
to the Company in writing.
12. HEADINGS, ETC. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect the meaning hereof.
13. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof
may be changed, waived, discharged or terminated orally but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
14. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
12
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed and
delivered this Warrant as of this 17th day of April, 1996.
--
TRUMP HOTELS & CASINO RESORTS, INC.
By: /s/
--------------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
Attest:
/s/
- ------------------------------
Name: Robert M. Pickus
Title: Executive Vice President
and Secretary
13
<PAGE>
WARRANT EXERCISE FORM
To: Trump Hotels & Casino Resorts, Inc.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _____________ shares of Common Stock of Trump Hotels &
Casino Resorts, Inc. and herewith makes payment of $ _____________ therefor,
and requests that the certificates for such shares be issued in the name of, and
be delivered to ______________, whose address is _______________________.
Dated:
________________________
<PAGE>
TRANSFER OF WARRANT FORM
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _____________________ the right represented by the within Warrant
to purchase the ________ shares of the Common Stock of Trump Hotels & Casino
Resorts, Inc. to which the within Warrant relates, and appoints
______________ attorney to transfer said right on the books of Trump Hotels &
Casino Resorts, Inc. with full power of substitution in the premises.
Dated:
________________________
In the presence of
_________________________
<PAGE>
Warrant No. W-003
WARRANT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON ITS EXERCISE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION UNDER
THE SECURITIES ACT OR IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL
REASONABLY SATISFACTORY TO TRUMP HOTELS & CASINO RESORTS, INC., QUALIFIES AS AN
EXEMPT TRANSACTION UNDER THE SECURITIES ACT AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER.
TRUMP HOTELS & CASINO RESORTS, INC.
COMMON STOCK PURCHASE WARRANT
TRUMP HOTELS & CASINO RESORTS, INC., a Delaware corporation (the
"Company"), hereby certifies that, for value received, DONALD J. TRUMP
("Trump"), or his assigns, is entitled, subject to the terms set forth below, to
purchase from the Company, at any time and from time to time during the period
beginning on April 17, 1996 and ending on April 17, 2001 in whole or in part, an
aggregate of six hundred thousand (600,000) fully paid and non-assessable shares
of the Common Stock of the Company, par value $ .01 per share, at a purchase
price, subject to the provisions of Section 3 hereof, of $40.00 per share (the
"Purchase Price"). The Purchase Price and the number and character of such
shares are subject to adjustment as provided below, and the term "Common Stock"
shall mean, unless the context otherwise requires, the stock or other securities
or property at the time deliverable upon the exercise of this Warrant. This
Warrant is herein called the "Warrant."
1. EXERCISE OF WARRANT. The purchase rights evidenced by this
Warrant shall be exercised by the holder surrendering this Warrant, with the
form of subscription at the end hereof duly executed by such holder, to the
Company at its office in Atlantic City, New Jersey, accompanied by payment, of
an amount (the "Exercise Amount") equal to the Purchase Price multiplied by the
number of shares being purchased pursuant to such exercise, payable as follows:
(i) by payment to the Company in cash, by certified or official bank check, or
by wire transfer of the Exercise Amount, (ii) by surrender to the Company for
cancellation of securities of the Company having a Market Price (as hereinafter
defined) on the date of exercise equal to the Exercise Amount; or (c) by a
combination of the methods described in clauses (a) and (b) above. In lieu of
exercising the Warrant, the holder may elect to receive a payment equal to the
difference between (i) the Market Price multiplied by the number of shares as to
which the payment is then being elected and (ii) the exercise price with respect
to such shares, payable by the Company to the holder of this Warrant only in
shares of Common Stock valued at the Market Price on the date of exercise. For
purposes hereof, the term "Market Price" shall mean the average high and low
sale price of a share of Common Stock for the 15 consecutive trading days
preceding such day on the principal national securities exchange on which the
shares of Common Stock or securities are listed or admitted to trading or, if
not listed or admitted to trading on any national securities exchange, the
average of the reported bid and asked prices during such 15 trading day period
in the over-the-counter market as furnished by the National Quotation Bureau,
Inc., or, if such firm is not then engaged in the business of reporting such
prices, as furnished by any member of the National Association of Securities
Dealers, Inc. selected by the Company or, if the shares of Common Stock or
securities are not publicly traded, the Market Price for such day shall be the
fair market value thereof determined jointly by the Company and the holder of
this Warrant; provided, however, that if such parties are unable to reach
agreement within a reasonable period of time, the Market Price shall be
determined in good faith by the independent investment banking firm selected
jointly by the Company and the holder of this Warrant or, if that selection
cannot be made within 15 days, by an independent investment banking firm
selected by the American Arbitration Association in accordance with its rules.
<PAGE>
1.1 Partial Exercise. This Warrant may be exercised for less than
----------------
the full number of shares of Common Stock, in which case the number of shares
receivable upon the exercise of this Warrant as a whole, and the sum payable
upon the exercise of this Warrant as a whole, shall be proportionately reduced.
Upon any such partial exercise, the Company at its expense will forthwith issue
to the holder hereof a new Warrant or Warrants of like tenor calling for the
number of shares of Common Stock as to which rights have not been exercised,
such Warrant or Warrants to be issued in the name of the holder hereof or his
nominee (upon payment by such holder of any applicable transfer taxes).
2. DELIVERY OF STOCK CERTIFICATES ON EXERCISE. As soon as
practicable after the exercise of this Warrant and payment of the Purchase
Price, and in any event within ten (10) days thereafter, the Company, at its
expense, will cause to be issued in the name of and delivered to the holder
hereof a certificate or certificates for the number of fully paid and non-
assessable shares or other securities or property to which such holder shall be
entitled upon such exercise, plus, in lieu of any fractional share to which such
holder would otherwise be entitled, cash in an amount determined in accordance
with Section 3.9 hereof. The Company agrees that the shares so purchased shall
be deemed to be issued to the holder hereof as the record owner of such shares
as of the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as aforesaid.
3. ANTI-DILUTION PROVISIONS AND OTHER ADJUSTMENTS. In order to
prevent dilution of the right granted hereunder, the Purchase Price shall be
subject to adjustment from time to time in accordance with this Section 3. Upon
each adjustment of the Purchase Price pursuant to this Section 3, the registered
holder of this Warrant shall thereafter be entitled to acquire upon exercise, at
the Purchase Price resulting from such adjustment, the number of shares of the
Company's Common Stock obtainable by multiplying the Purchase Price in effect
immediately prior to such adjustment by the number of shares of the Company's
Common Stock acquirable immediately prior to such adjustment and dividing the
product thereof by the Purchase Price resulting from such adjustment.
3.1. Adjustment for Issue or Sale of Common Stock at less than Market
----------------------------------------------------------------
Price. (a) Except as provided in Section 3.2 or 3.5 below, if and whenever on
- -----
or after the date of issuance hereof the Company shall issue or sell, or shall
in accordance with subsections 3.1(c)(1) to (9), inclusive, be deemed to have
issued or sold, any shares of its Common Stock for a consideration per share
less than the Market Price in effect immediately prior to the time of such issue
or sale, then forthwith upon such issue or sale (the "Triggering Transaction"),
the Purchase Price shall, subject to subsections (1) to (9) of Section 3.1(c),
be reduced to the lower of the prices (calculated to the nearest tenth of a
cent) determined as follows:
(i) by dividing (a) an amount equal to the sum of (x) the product
derived by multiplying the Number of Common Shares Deemed Outstanding
immediately prior to such Triggering Transaction by the Purchase Price then
in effect, plus (y) the consideration, if any, received by the Company upon
consummation of such Triggering Transaction, by (b) an amount equal to the
sum of (x) the Number of Shares Deemed Outstanding immediately prior to
such Triggering Transaction plus (y) the number of shares of Common Stock
issued (or deemed to be issued in accordance with subsections 3.1(1) to
(9)) in connection with the Triggering Transaction; and
(ii) by multiplying the Purchase Price in effect immediately
prior to the time of such issue or sale by a fraction, the numerator of
which shall be the sum of (x) the Number of Shares Deemed Outstanding
immediately prior to such Triggering Transaction multiplied by the Market
Price immediately prior to such Triggering Transaction plus (y) the
consideration received by the Company upon such Triggering Transaction, and
the denominator of which shall be the product of (x) the Number of Shares
Deemed Outstanding immediately after such issue or sale, multiplied by (y)
the Market Price immediately prior to such issue or sale.
(b) For purposes of this Section 3, the term "Number of Common Shares
Deemed Outstanding" at any given time shall mean the sum of (i) the number of
shares of the Company's Common Stock
2
<PAGE>
outstanding at such time, and (ii) the number of shares of the Company's Common
Stock deemed to be outstanding under the applicable subsections 3.1(c)(1) to
(9), inclusive, at such time.
(c) For purposes of determining the adjusted Purchase Price under
this Section 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:
(1) In case the Company at any time shall in any manner
grant (whether directly or by assumption in a merger or otherwise) any
rights to subscribe for or to purchase, or any options for the
purchase of, Common Stock or any stock or other securities convertible
into or exchangeable for Common Stock (such rights or options being
herein called "Options" and such convertible or exchangeable stock or
securities being herein called "Convertible Securities"), whether or
not such Options or the right to convert or exchange any such
Convertible Securities are immediately exercisable and the price per
share for which the Common Stock is issuable upon exercise, conversion
or exchange (determined by dividing (x) the total amount, if any,
received or receivable by the Company as consideration for the
granting of such Options, plus the minimum aggregate amount of
additional consideration payable to the Company upon the exercise of
all such Options, plus, in the case of such Options which relate to
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof, by
(y) the total maximum number of shares of Common Stock issuable upon
the exercise of such Options or the conversion or exchange of such
Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of the granting of such Option,"
then the total maximum amount of Common Stock issuable upon the
exercise of such Options, or, in the case of Options for Convertible
Securities, upon the conversion or exchange of such Convertible
Securities, shall (as of the date of granting of such Options) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such shares of Common Stock or
such Convertible Securities upon the exercise of such Options, except
as otherwise provided in subsection (3) below.
(2) In case the Company at any time shall in any manner
issue (whether directly or by assumption in a merger or otherwise) or
sell any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per
share for which Common Stock is issuable upon such conversion or
exchange (determined by dividing (x) the total amount received or
receivable by the Company as consideration for the issue or sale of
such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the
conversion or exchange thereof, by (y) the total maximum number of
shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities) shall be less than the Purchase Price in
effect immediately prior to the time of such issue or sale, then the
total maximum number of shares of Common Stock issuable upon
conversion or exchange of all such Convertible Securities shall (as of
the date of the issue or sale of such Convertible Securities) be
deemed to be outstanding and to have been issued and sold by the
Company for such price per share. No adjustment of the Purchase Price
shall be made upon the actual issue of such Common Stock upon exercise
of the rights to exchange or convert under such Convertible
Securities, except as otherwise provided in subsection (3) below.
(3) If the purchase price provided for in any Options
referred to in subsection (1), the additional consideration, if any,
payable upon the conversion or exchange of any Convertible Securities
referred to in subsections (1) or (2), or the rate at which any
Convertible Securities referred to in subsection (1) or (2) are
convertible into or exchangeable for Common Stock shall change at any
time (other than under or by reason of provisions designed to protect
against dilution of the type set forth in Section 3.1 or 3.3), the
Purchase Price in effect at the time of such change shall forthwith be
readjusted to the Purchase Price
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<PAGE>
which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the
case may be, at the time initially granted, issued or sold. If the
purchase price provided for in any Option referred to in subsection
(1) or the rate at which any Convertible Securities referred to in
subsections (1) or (2) are convertible into or exchangeable for Common
Stock, shall be reduced at any time under or by reason of provisions
with respect thereto designed to protect against dilution, then in
case of the delivery of Common Stock upon the exercise of any such
Option or upon conversion or exchange of any such Convertible
Security, the Purchase Price then in effect hereunder shall forthwith
be adjusted to such respective amount as would have been obtained had
such Option or Convertible Security never been issued as to such
Common Stock and had adjustments been made upon the issuance of the
shares of Common Stock delivered as aforesaid, but only if as a result
of such adjustment the Purchase Price then in effect hereunder is
hereby reduced.
(4) On the expiration of any Option or the termination of
any right to convert or exchange any Convertible Securities, the
Purchase Price then in effect hereunder shall forthwith be increased
to the Purchase Price which would have been in effect at the time of
such expiration or termination had such Option or Convertible
Securities, to the extent outstanding immediately prior to such
expiration or termination, never been issued.
(5) In case any Options shall be issued in connection with
the issue or sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options
shall be deemed (solely for the purpose of this Warrant) to have been
issued without consideration.
(6) In case any shares of Common Stock, Options or
Convertible Securities shall be issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor shall be
deemed to be the amount received by the Company therefor. In case any
shares of Common Stock, Options or Convertible Securities shall be
issued or sold for a consideration other than cash, the amount of the
consideration other than cash received by the Company shall be the
fair value of such consideration as determined in good faith by the
Board of Directors of the Company. In case any shares of Common
Stock, Options or Convertible Securities shall be issued in connection
with any merger in which the Company is the surviving corporation, the
amount of consideration therefor shall be deemed to be the fair value
of such portion of the net assets and business of the non-surviving
corporation as shall be attributed by the Board of Directors of the
Company in good faith to such Common Stock, Options or Convertible
Securities, as the case may be.
(7) The number of shares of Common Stock outstanding at any
given time shall not include shares owned or held by or for the
account of the Company, and the disposition of any shares so owned or
held shall be considered an issue or sale of Common Stock for the
purpose of this Section 3.1.
(8) In case the Company shall declare a dividend or make
any other distribution upon the stock of the Company payable in Common
Stock, Options, or Convertible Securities, then in such case any
Common Stock, Options or Convertible Securities, as the case may be,
issuable in payment of such dividend or distribution shall be deemed
to have been issued or sold without consideration.
(9) For purposes of this Section 3.1, in case the Company
shall take a record of the holders of its Common Stock for the purpose
of entitling them (x) to receive a dividend or other distribution
payable in Common Stock, Options or in Convertible Securities, or (y)
to subscribe for or purchase Common Stock, Options or Convertible
Securities, then such record date shall be deemed to be the date of
the issue or sale of the shares of Common Stock deemed
4
<PAGE>
to have been issued or sold upon the declaration of such dividend or
the making of such other distribution or the date of the granting of
such right or subscription or purchase, as the case may be.
3.2. Dividends Not Paid Out of Earnings or Earned Surplus. In the
----------------------------------------------------
event the Company shall declare a dividend upon the Common Stock (other than a
dividend payable in Common Stock covered by subsection 3.1(8)) payable otherwise
than out of earnings or earned surplus, determined in accordance with generally
accepted accounting principles, including the making of appropriate deductions
for minority interests, if any, in subsidiaries (such amount in excess of
earnings or earned surplus herein referred to as "Liquidating Dividends"), then,
as soon as possible after the exercise of this Warrant, the Company shall pay to
the person exercising such Warrant an amount equal to the aggregate value at the
time of such exercise of all Liquidating Dividends paid from the date of
issuance of this Warrant to the date of exercise (including but not limited to
Liquidating Dividends upon Common Stock which would have been issued at the time
of such earlier exercise and upon all other securities which would have been
issued with respect to such Common Stock by reason of stock splits, stock
dividends, mergers or reorganizations, or for any other reason). For the
purposes of this Section 3.2, a dividend other than in cash shall be considered
payable out of earnings or earned surplus only to the extent that such earnings
or earned surplus are charged an amount equal to the fair value of such dividend
as determined in good faith by the Board of Directors of the Company.
3.3. Subdivisions and Combinations. In case the Company shall at any
-----------------------------
time subdivide (other than by means of a dividend payable in Common Stock
covered by subsection 3.1(8)), its outstanding shares of Common Stock into a
greater number of shares, the Purchase Price in effect immediately prior to such
subdivision shall be proportionately reduced, and, conversely, in case the
outstanding shares of Common Stock of the Company shall be combined into a
smaller number of shares, the Purchase Price in effect immediately prior to such
combination shall be proportionately increased.
3.4. Reorganization, Reclassification, Consolidation, Merger or Sale
---------------------------------------------------------------
of Assets. If any capital reorganization or reclassification of the capital
- ---------
stock of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Common Stock shall
be entitled to receive stock, securities, cash or other property with respect to
or in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder of this Warrant shall have the right to acquire
and receive upon exercise of this Warrant such shares of stock, securities, cash
or other property issuable or payable (as part of the reorganization,
reclassification, consolidation, merger or sale) with respect to or in exchange
for such number of outstanding shares of the Company's Common Stock as would
have been received upon exercise of this Warrant at the Purchase Price then in
effect. The Company will not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume by written instrument mailed or delivered to
the holder of this Warrant at the last address of such holder appearing on the
books of the Company, the obligation to deliver to such holder such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase. If a purchase, tender or exchange
offer is made to and accepted by the holders of more than 50% of the outstanding
shares of Common Stock of the Company, the Company shall not effect any
consolidation, merger or sale with the person having made such offer or with any
Affiliate of such person, unless prior to the consummation of such
consolidation, merger or sale the holder of this Warrant shall have been given a
reasonable opportunity to then elect to receive upon the exercise of this
Warrant either the stock, securities or assets then issuable with respect to the
Common Stock of the Company or the stock, securities or assets, or the
equivalent, issued to previous holders of the Common Stock in accordance with
such offer. For purposes hereof the term "Affiliate" with respect to any given
person shall mean any person controlling, controlled by or under common control
with the given person.
3.5. No Adjustment for Exercise of Certain Options, Warrants, Etc.
-------------------------------------------------------------
The provisions of this Section 3 shall not apply to any Common Stock issued,
issuable or deemed outstanding under subsections 3.1(1) to (9) inclusive: (i)
to any person pursuant to any stock option, stock purchase or similar plan or
arrangement
5
<PAGE>
for the benefit of employees, consultants or directors of the Company or its
subsidiaries in effect on the date of issuance hereof, (ii) pursuant to options,
warrants and conversion rights in existence on the date of issuance hereof or
(iii) pursuant to the Exchange and Registration Rights Agreement, dated June 12,
1995, between the Company and Trump, as it may be amended from time to time (the
"Exchange Rights Agreement").
3.6. Notices of Record Date, Etc. In the event that:
---------------------------
(1) the Company shall declare any cash dividend upon its Common
Stock, or
(2) the Company shall declare any dividend upon its Common Stock
payable in stock or make any special dividend or other distribution to the
holders of its Common Stock, or
(3) the Company shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any class or
other rights, or
(4) there shall be any capital reorganization or reclassification
of the capital stock of the Company, including any subdivision or
combination of its outstanding shares of Common Stock, or consolidation or
merger of the Company with, or sale of all or substantially all of its
assets to, another corporation, or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in connection with such event, the Company shall give to the holder of
this Warrant:
(i) at least twenty (20) days' prior written notice of the date
on which the books of the Company shall close or a record shall be taken
for such dividend, distribution or subscription rights or for determining
rights to vote in respect of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up; and
(ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, at
least twenty (20) days' prior written notice of the date when the same
shall take place. Such notice in accordance with the foregoing clause (i)
shall also specify, in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Common Stock shall be
entitled thereto, and such notice in accordance with the foregoing clause
(ii) shall also specify the date on which the holders of Common Stock shall
be entitled to exchange their Common Stock for securities or other property
deliverable upon such reorganization, reclassification consolidation,
merger, sale, dissolution, liquidation or winding up, as the case may be.
Each such written notice shall be given by first class mail, postage
prepaid, addressed to the holder of this Warrant at the address of such
holder as shown on the books of the Company.
3.7. Grant, Issue or Sale of Options, Convertible Securities, or
-----------------------------------------------------------
Rights. If at any time or from time to time on or after the date of issuance
- ------
hereof, the Company shall grant, issue or sell any Options, Convertible
Securities or rights to purchase property (the "Purchase Rights") pro rata to
the record holders of any class of Common Stock of the Company and such grants,
issuances or sales do not result in an adjustment of the Purchase Price under
Section 3.1 hereof, then the holder of this Warrant shall be entitled to acquire
(within thirty (30) days after the later to occur of the initial exercise date
of such Purchase Rights or receipt by such holder of the notice concerning
Purchase Rights to which such holder shall be entitled under Section 3.6) and
upon the terms applicable to such Purchase Rights either:
(i) the aggregate Purchase Rights which such holder could have
acquired if it had held the number of shares of Common Stock acquirable
upon exercise of this Warrant immediately before the grant, issuance or
sale of such Purchase Rights; provided that if any Purchase Rights were
distributed to holders of Common Stock without the payment of additional
consideration by such
6
<PAGE>
holders, corresponding Purchase Rights shall be distributed to the
exercising holder of this Warrant as soon as possible after such exercise
and it shall not be necessary for the exercising holder of this Warrant
specifically to request delivery of such rights; or
(ii) in the event that any such Purchase Rights shall have
expired or shall expire prior to the end of said thirty (30) day period,
the number of shares of Common Stock or the amount of property which such
holder could have acquired upon such exercise at the time or times at which
the Company granted, issued or sold such expired Purchase Rights.
3.8. Adjustment by Board of Directors. If any event occurs as to
--------------------------------
which, in the opinion of the Board of Directors of the Company, the provisions
of this Section 3 are not strictly applicable or if strictly applicable would
not fairly protect the rights of the holder of this Warrant in accordance with
the essential intent and principles of such provisions, then the Board of
Directors shall make an adjustment in the application of such provisions, in
accordance with such essential intent and principles, so as to protect such
rights as aforesaid, but in no event shall any adjustment have the effect of
increasing the Purchase Price as otherwise determined pursuant to any of the
provisions of this Section 3 except in the case of a combination of shares of a
type contemplated in Section 3.3 and then in no event to an amount larger than
the Purchase Price as adjusted pursuant to Section 3.3.
3.9. Fractional Shares. The Company shall not issue fractions of
-----------------
shares of Common Stock upon exercise of this Warrant or scrip in lieu thereof.
If any fraction of a share of Common Stock would, except for the provisions of
this Section 3.9, be issuable upon exercise of this Warrant, the Company shall
in lieu thereof pay to the person entitled thereto an amount in cash equal to
the current value of such fraction, calculated to the nearest one-hundredth
(1/100) of a share, to be computed (i) if the Common Stock is listed on any
national securities exchange on the basis of the last sales price of the Common
Stock on such exchange (or the quoted closing bid price if there shall have been
no sales) on the date of conversion, or (ii) if the Common Stock shall not be
listed, on the basis of the mean between the closing bid and asked prices for
the Common Stock on the date of conversion as reported by NASDAQ, or its
successor, and if there are not such closing bid and asked prices, on the basis
of the fair market value per share as determined by the Board of Directors of
the Company.
3.10. Officers' Statement as to Adjustments. Whenever the Purchase
-------------------------------------
Price shall be adjusted as provided in Section 3 hereof, the Company shall
forthwith file at each office designated for the exercise of this Warrant, a
statement, signed by the Chairman of the Board, the President, any Vice
President or Treasurer of the Company, showing in reasonable detail the facts
requiring such adjustment and the Purchase Price that will be effective after
such adjustment. The Company shall also cause a notice setting forth any such
adjustments to be sent by mail, first class, postage prepaid, to the record
holder of this Warrant at his or its address appearing on the stock register.
If such notice relates to an adjustment resulting from an event referred to in
Section 3.6, such notice shall be included as part of the notice required to be
mailed and published under the provisions of Section 3.6 hereof.
4. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of
its charter or through reorganization, consolidation, merger, dissolution, sale
of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the holder hereof against dilution or other impairment. Without limiting the
generality of the foregoing, the Company will not increase the par value of any
shares of stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and at all times will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable stock upon the exercise of this
Warrant.
5. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company shall at all times reserve and keep available out of its authorized but
unissued stock, solely for the
7
<PAGE>
issuance and delivery upon the exercise of this Warrant and other similar
Warrants, such number of its duly authorized shares of Common Stock as from time
to time shall be issuable upon the exercise of this Warrant and all other
similar Warrants at the time outstanding.
6. REGISTRATION RIGHTS. The holder of this warrant shall have the
following registration rights with respect to the Common Stock:
6.1. Registration on Demand. (a) Upon written notice to the Company
----------------------
from holders of at least twenty-five percent (25%) of the Registrable Securities
(as hereinafter defined), determined as if the Warrant 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 Securities and Exchange
Commission (the "SEC") a registration statement on the appropriate form covering
all Registrable Securities specified in such demand and by such 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 two (2) registrations pursuant to this Section 6.1. The
Company shall be obligated to effect any registration pursuant to this Section
6.1 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 6.1 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. For
purposes hereof, the term "Registrable Securities" shall mean, collectively, (i)
the Common Stock issued or issuable upon exercise of the Warrant 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.
(b) The Company will be obligated to pay all Registration Expenses
with respect to the registrations pursuant to this Section 6.1.
(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) they 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 Actor any similar state law then
in force, or (iii) they shall have ceased to be outstanding.
(d) A registration requested pursuant to this Section 6.1 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 Warrant with
respect thereto (without regard to the use of best 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 (as hereinafter defined). If (i)
a registration requested pursuant to this Section 6.1 is deemed not to have been
effected or (ii) the registration requested pursuant to this
8
<PAGE>
Section 6.1 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 6.1 and (y) such requested registration
shall not reduce the number of registrations the Company shall be obligated to
effect pursuant to this Section 6.1. For the purposes hereof, the term "Stop
Order" shall mean, with respect to any registration of the Registrable
Securities or any portion thereof effected pursuant to this Warrant, 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.
(e) Any offering of Registrable Securities contemplated by this
Section 6.1 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 6.1, 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
subsection 6.1(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 underwriter in a public offering to be effected pursuant
to the provisions of this Section 6.1 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, registration together with any other securities to be included
in such, have a value, based on the proposed offering price, of less than
$2,000,000.
6.2. 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 (as hereinafter defined) of such registration. For
the purposes hereof, the term "Registration Expenses" shall mean 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.
(b) The Company may in its discretion withdraw any registration
statement filed pursuant to this Section 6.2 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 6.2 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
9
<PAGE>
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).
6.3. Indemnity and Contribution. (a) In connection with a
--------------------------
registration statement filed with the SEC pursuant to this Section 6, the
Company shall provide each holder of Registrable Securities included in such
registration statement, and 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 Securities Exchange Act of 1934 (the
"Exchange Act") , with indemnification against any losses, claims, damages or
liabilities, reasonable attorneys 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, and 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 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 subsection 6.3(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 shall contribute to the aggregate Damages
contemplated by said indemnity agreement incurred by each of the Company and the
holders of the Registrable Securities, as incurred, in such proportions as is
appropriate to reflect the relative fault of the Company and the holders of the
Registrable Securities in connection with the statements or omissions which
resulted in such Damages. The relative fault of the Company on one hand and the
holders of the Registrable Securities on the other 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 on one hand and the holders of the
Registrable Securities on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(c) In no event shall a holder of Registrable Securities be liable
for indemnification or contribution pursuant to this Section 6 in excess of the
net proceeds received upon the sale of such Registrable Securities.
6.4. Certain Procedures. The Company shall provide each holder of
------------------
Registrable Securities included in any registration with (i) 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
(ii) 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.
10
<PAGE>
6.5. 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:
(1) 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");
(2) 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
(3) 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.
6.6. Lock-Ups. After receipt of any notice pursuant to Section 6.1
--------
or 6.2 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 the Company described in
this Section 6, 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. Nothing in this Section 6.6 shall preclude the Company from issuing
shares of Registrable Securities upon exercise of the Warrant.
6.7. 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 or entity 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 Warrant, except pursuant to the
Exchange Rights Agreement.
7. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (with surety if reasonably required) in an amount reasonably
satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company will issue, in lieu thereof, a new Warrant of
like tenor.
8. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that the same may be specifically enforced.
9. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which each taker or owner hereof consents and agrees:
(a) Subject to the legend appearing on the first page hereof,
title to this Warrant may be transferred by endorsement (by the holder
hereof executing the form of assignment at the end hereof including
guaranty of signature) and delivery in the same manner as in the case of a
negotiable instrument transferable by endorsement and delivery.
11
<PAGE>
(b) Any person in possession of this Warrant properly endorsed
is authorized to represent himself as absolute owner hereof and is granted
power to transfer absolute title hereto by endorsement and delivery hereof
to a bona fide purchaser hereof for value; each prior taker or owner waives
and renounces all of his equities or rights in this Warrant in favor of
every such bona fide purchaser, and every such bona fide purchaser shall
acquire title hereto and to all rights represented hereby.
(c) Until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder of this Warrant as the
absolute owner hereof for all purposes without being affected by any notice
to the contrary.
(d) Prior to the exercise of this Warrant, the holder hereof
shall not be entitled to any rights of a shareholder of the Company with
respect to shares for which this Warrant shall be exercisable, including,
without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be
entitled to receive any notice of any proceedings of the Company, except as
provided herein.
(e) The Company shall not be required to pay any Federal or
state transfer tax or charge that may be payable in respect of any transfer
involved in the transfer or delivery of this Warrant or the issuance or
conversion or delivery of certificates for Common Stock in a name other
than that of the registered holder of this Warrant or to issue or deliver
any certificates for Common Stock upon the exercise of this Warrant until
any and all such taxes and charges shall have been paid by the holder of
this Warrant or until it has been established to the Company's satisfaction
that no such tax or charge is due.
10. SUBDIVISION OF RIGHTS. This Warrant (as well as any new warrants
issued pursuant to the provisions of this Section) is exchangeable, upon the
surrender hereof by the holder hereof, at the principal office of the Company
for any number of new warrants of like tenor and date representing in the
aggregate the right to subscribe for and purchase the number of shares of Common
Stock of the Company which may be subscribed for and purchased hereunder.
11. MAILING OF NOTICES, ETC. All notices and other communications
from the Company to the holder of this Warrant shall be mailed by first-class
certified mail, postage prepaid, to the address furnished to the Company in
writing by the last holder of this Warrant who shall have furnished an address
to the Company in writing.
12. HEADINGS, ETC. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect the meaning hereof.
13. CHANGE, WAIVER, ETC. Neither this Warrant nor any term hereof
may be changed, waived, discharged or terminated orally but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought.
14. GOVERNING LAW. THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
12
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed and
delivered this Warrant as of this 17th day of April, 1996.
--
TRUMP HOTELS & CASINO RESORTS, INC.
By: /s/
--------------------------------------------
Name: Nicholas L. Ribis
Title: President and Chief Executive Officer
Attest:
/s/
- -------------------------------
Name: Robert M. Pickus
Title: Executive Vice President
and Secretary
13
<PAGE>
WARRANT EXERCISE FORM
To: Trump Hotels & Casino Resorts, Inc.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _____________ shares of Common Stock of Trump Hotels &
Casino Resorts, Inc. and herewith makes payment of $ _____________ therefor,
and requests that the certificates for such shares be issued in the name of, and
be delivered to ______________, whose address is _______________________.
Dated:
________________________
<PAGE>
TRANSFER OF WARRANT FORM
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _____________________ the right represented by the within Warrant
to purchase the ________ shares of the Common Stock of Trump Hotels & Casino
Resorts, Inc. to which the within Warrant relates, and appoints
______________ attorney to transfer said right on the books of Trump Hotels &
Casino Resorts, Inc. with full power of substitution in the premises.
Dated:
________________________
In the presence of
_________________________
<PAGE>
Exhibit VI.I: Pledge and Security Agreement among Donald J. Trump, Trump
- ------------
Casinos, Inc. and Donaldson Lufkin & Jenrette, Inc., dated April 17, 1996.
<PAGE>
EXHIBIT VI.I
- ------------
PLEDGE AND SECURITY AGREEMENT
-----------------------------
PLEDGE AND SECURITY AGREEMENT (this "Pledge Agreement"), dated as of
April 17, 1996, made by Donald J. Trump, an individual residing in the State of
New York (the "Borrower") and Trump Casinos, Inc., formerly known as Trump Taj
Mahal, Inc., a New Jersey corporation ("TTMI" and together with the Borrower,
referred to collectively herein as the "Pledgor") in favor of Donaldson, Lufkin
& Jenrette, Inc. (the "Secured Party").
W I T N E S S E T H:
-------------------
WHEREAS, (a) the Borrower has entered into a Secured Loan Agreement,
dated as of April 17, 1996, with the Secured Party (as amended, supplemented or
otherwise modified from time to time, the "Loan Agreement" and capitalized terms
not defined herein but defined therein being used herein as therein defined) and
(b) the Borrower owns all of the issued and outstanding shares of TTMI;
WHEREAS, the Pledgor is the legal and beneficial owner of the shares
of capital stock and certificated partnership interests described (a) in
Schedule I hereto as being owned by the Pledgor and issued by the issuers named
therein (the "First Lien Shares") and (b) in Schedule II hereto as being owned
by the Pledgor and issued by the issuers named therein (the "Second Lien Shares"
and together with the First Lien Shares, the "Pledged Shares");
WHEREAS, the Second Lien Shares are subject to a first priority lien
in favor of Citibank, N.A., as agent ("Citibank") and the First Lien Shares are
subject to a second priority lien in favor of Citibank pursuant to the Citibank
Pledge Agreement;
WHEREAS, the respective rights regarding the First Lien Shares and the
Second Lien Shares are set forth in the Intercreditor Agreement dated as of the
date hereof (the "Intercreditor Agreement") between the Secured Party and
Citibank; and
WHEREAS, it is a condition precedent to the effectiveness of the Loan
Agreement and the obligation of the Secured Party to make the Loan contemplated
thereby that the Pledgor shall have entered into this Pledge Agreement;
NOW, THEREFORE, in consideration of the premises, the Pledgor hereby
agrees with the Secured Party as follows:
SECTION 1. (a) Pledge, Assignment and Grant of Security. The Pledgor
----------------------------------------
hereby assigns and pledges to the Secured
<PAGE>
Party, and hereby grants a security interest to the Secured Party in the
following (the "Collateral"):
(i) all of the Pledged Shares;
(ii) the certificates representing the shares referred to in clause
(i) above (clauses (i) and (ii) the "Pledged Collateral");
(iii) that certain Amended and Restated Exchange and Registration
Rights Agreement, dated as of April 17, 1996, by and among Trump Hotels & Casino
Resorts, Inc., the Borrower and TTMI (as amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof and hereof, the
"Assigned Agreement"), including, without limitation, (1) all rights of the
Pledgor to receive moneys due and to become due under or pursuant to the
Assigned Agreement, (2) all rights of the Pledgor to receive proceeds of any
insurance, indemnity, warranty or guaranty with respect to the Assigned
Agreement, (3) claims of the Pledgor for damages arising out of or for breach of
or default under the Assigned Agreement, (4) the right of the Pledgor to
terminate the Assigned Agreement, to perform thereunder and to compel
performance and otherwise exercise all remedies thereunder and (5) the right of
the Pledgor to convert partnership interests in the Partnership into shares of
the Company;
(iv) all of the monies deposited from time to time in the Interest
Reserve Account referred to below;
(v) the Interest Reserve Account (as hereinafter defined) and the
securities entitlements, financial assets and other securities, instruments or
investors credited thereto; and
(vi) all dividends, distributions, cash, instruments and other
property or proceeds, from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the foregoing;
including, without limitation, any shares of the Company received on conversion
of partnership interests in the Partnership.
(b) Establishment of Interest Reserve Account. (i) The Borrower
-----------------------------------------
hereby establishes with the Secured Party the Interest Reserve Account (the
"Interest Reserve Account") in the name of the Secured Party. Except as
otherwise expressly provided for herein, the Interest Reserve Account shall be
under the exclusive dominion and control of the Secured Party. The Borrower
hereby irrevocably directs and authorizes the Secured Party to deposit into and
withdraw funds from the Interest Reserve Account in accordance with the terms
and conditions of this Pledge Agreement. The Borrower shall have no right of
withdrawal in respect of the Interest Reserve Account, except that so long as no
Event of
-2-
<PAGE>
Default or event which with the giving of notice and/or lapse of time would
become an Event of Default (a "Default"), shall have occurred and be continuing,
the Borrower shall have the sole right to direct the investment of the moneys in
the Interest Reserve Account, but solely in Permitted Investments (as defined
below), and any interest accruing thereon shall be for the benefit of the
Borrower to the extent such interest and the principal amount of the Interest
Reserve Account exceeds the Required Balance (as defined below). The Secured
Party shall remit any such excess to the Borrower on a quarterly basis.
(i) In the event that the Borrower fails to make the scheduled
payments of principal and interest on the Note or other payments as required by
the Loan Agreement (the "Loan Payments"), the Borrower hereby irrevocably
directs the Secured Party shall transfer funds from the Interest Reserve Account
to its own account for its own benefit in satisfaction of such Loan Payments.
Each transfer of funds shall be made only to the extent that funds are on
deposit in the Interest Reserve Account, and the Secured Party shall have no
responsibility to make additional funds available in the event that funds on
deposit are insufficient. Notwithstanding the foregoing, the Secured Party
shall also have a right of set-off against funds and property in the Interest
Reserve Account and shall have a lien on such account as provided in Section
1(a). The Borrower shall, however, remain liable for a deficiency in the event
that funds on deposit are insufficient to satisfy all Obligations (as
hereinafter defined).
(ii) The Borrower shall cause to be transferred to the Interest
Reserve Account, immediately upon receipt of the proceeds of the Loan, an amount
equal to $3,261,073.01 (the "Required Balance"). After any application of funds
pursuant to clause (ii) above, the Borrower shall immediately deposit additional
funds into the Interest Reserve Account so as to cause the amount on deposit
therein to equal or exceed the Required Balance.
(iii) "Permitted Investments" shall mean (a) securities issued or
directly and fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and credit of
the United States of America is pledged in support thereof) having a maturity
not exceeding one year from the date of issuance, (b) certificates of deposit of
any domestic commercial bank of recognized standing having capital and surplus
in excess of $500,000,000 having a maturity not exceeding one year from the date
of acquisition and (c) commercial paper of any domestic corporation rated at
least A-1 or the equivalent thereof by Standard & Poor's Corporation or at least
P-1 or the equivalent thereof by Moody's Investor Services, Inc. and having a
maturity not exceeding ninety (90) days from the date of acquisition.
SECTION 2. Security for Obligations. This Pledge Agreement secures
------------------------
and the Collateral is security for, the full
-3-
<PAGE>
and prompt payment when due (whether at stated maturity, by acceleration or
otherwise) of, and the performance of, the Loan and all other advances, debts,
liabilities, obligations, covenants and duties owing by the Borrower to the
Lender pursuant to the Loan Documents, whether now or hereafter existing and
whether for principal, interest, fees, expenses or otherwise (the
"Obligations").
SECTION 3. Delivery of Pledged Collateral. All certificates or
------------------------------
instruments representing or evidencing the Pledged Collateral shall be delivered
to and held by or on behalf of the Secured Party pursuant hereto and shall be in
suitable form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
satisfactory to the Secured Party except that Second Lien Shares are being
delivered to Citibank as agent and bailee for DLJ. The Secured Party shall have
the right, at any time in its discretion and without notice to the Pledgor, to
transfer to or to register in its name or in the name of any of its nominees any
or all of the Pledged Collateral. In addition, the Secured Party shall have the
right at any time to exchange certificates or instruments representing or
evidencing any of the Pledged Collateral for certificates or instruments of
smaller or larger denominations.
SECTION 4. Representations and Warranties. The Pledgor makes the
------------------------------
following representations:
(a) The Pledged Shares (i) have been duly authorized and validly
issued, (ii) are fully paid and non-assessable and (iii) constitute the
percentage of the issued and outstanding shares of stock or partnership
interests of the respective issuers thereof set forth on each of Schedule I with
respect to the First Lien Shares and Schedule II with respect to the Second Lien
Shares.
(b) Each of the Borrower and TTMI is the legal and beneficial owner of
the Pledged Shares described on Schedules I and II and the Borrower is the legal
and beneficial owner of the other Collateral, all of which is free and clear of
any lien, security interest, option or other charge or encumbrance except for
(A) the lien created by this Pledge Agreement and (B) the lien created by the
Citibank Pledge Agreement.
(c) The pledge and grant of the Collateral pursuant to this Pledge
Agreement creates a valid and perfected first priority security interest in the
Collateral in favor of the Secured Party, securing the payment of all of the
Obligations; provided, however, that Pledgor makes no representations as to the
--------
relative priority of the Secured Party and Citibank, N.A.
(d) No consent, authorization, approval, or other action by, and no
notice to or filing with, any governmental authority is required either (i) for
the pledge by the Pledgor of
-4-
<PAGE>
the Collateral owned by the Pledgor pursuant to this Pledge Agreement or for the
due execution, delivery or performance of this Pledge Agreement by the Pledgor,
or (ii) for the exercise by the Secured Party of the voting or other rights
provided for in this Pledge Agreement or of the remedies in respect of the
Collateral pursuant to this Pledge Agreement, except for any required approval
of, consent from, or notice to the Casino Control Commission or the Division of
Gaming Enforcement, or as may be required in connection with the disposition of
the Pledged Collateral by laws affecting the offering and sale of securities
generally.
(e) The Assigned Agreement, a true and complete copy of which has been
furnished to the Secured Party, has been duly authorized, executed and delivered
by all parties thereto, has not been amended or otherwise modified, is in full
force and effect and is binding upon and enforceable against all parties thereto
in accordance with its terms. There exists no default under the Assigned
Agreement by any party thereto. Each party to the Assigned Agreement (other
than the Borrower) has executed and delivered to the Borrower a consent to the
assignment of the Assigned Agreement to the Secured Party pursuant to this
Pledge Agreement.
(f) The Borrower represents and warrants that he is located at (within
the meaning of Section 9-103(3)(d) of the New York Uniform Commercial Code), and
his chief executive office (within the meaning of such section) is 725 Fifth
Avenue, 24th Floor, New York, New York 10022 and TTMI represents and warrants
that it is located at (within the meaning of Section 9-103(3)(d) of the New York
Uniform Commercial Code), and its chief executive office (within the meaning of
such section) is [725 Fifth Avenue, New York, New York 10022].
SECTION 5. Further Assurances, Etc. (a) The Pledgor agrees that at
-----------------------
any time and from time to time, at the cost and expense of the Pledgor, the
Pledgor will promptly execute and deliver all further instruments and documents,
and take all further action, that may be necessary or desirable, or that the
Secured Party may request, in order to perfect and protect the lien granted or
purported to be granted hereby or to enable the Secured Party to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
(b) The Pledgor agrees to defend the title to the Collateral and the
lien thereon of the Secured Party against the claim of any other Person and to
maintain and preserve such lien until indefeasible payment in full of all of the
Obligations.
(c) The Borrower agrees that at any time and from time to time, upon
the written request of the Secured Party and at the cost and expense of the
Pledgor, the Borrower will promptly and duly execute and deliver any and all
instruments and documents and take such action as the Secured Party deems
necessary and may
-5-
<PAGE>
request to exercise the Borrower's conversion and registration rights under the
Assigned Agreement.
(d) (i) The Borrower shall keep his chief executive office and the
office where he keeps the original copies of the Assigned Agreement at 725 Fifth
Avenue, 24th Floor, New York, New York 10022 and (ii) TTMI's shall keep its
chief executive office and the office where its books and records are located at
725 Fifth Avenue, 24th Floor, New York, New York 10022 and neither the Borrower
nor TTMI shall change such office locations without 30 days' prior written
notice to the Secured Party. The Borrower will hold and preserve the Assigned
Agreement.
(e) The Pledgor shall deliver all certificates or other documents
representing the Pledged Collateral to the Secured Party with all necessary
stock transfer or other powers duly indorsed in blank. In the event Pledgor
obtains possession of any other stock certificates, partnership certificates or
other securities or instruments forming a part of the Collateral, Pledgor shall
promptly deliver same to Secured Party together with all necessary stock
transfer or other powers duly indorsed in blank. Prior to any such delivery,
any Collateral in Pledgor's possession shall be held by Pledgor in trust for the
Secured Party.
SECTION 6. Voting Rights; Dividends; Etc.
-----------------------------
(a) As long as no Event of Default shall have occurred and be
continuing (or, in the case of subsection (a)(i) of this Section 6, as long as
no notice thereof shall have been given by the Secured Party to the Pledgor):
(i) The Pledgor shall be entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Collateral owned by the
Pledgor or any part thereof for any purpose not inconsistent with the terms of
this Pledge Agreement or any other Loan Document; provided, however, that the
-------- -------
Pledgor shall not exercise or shall refrain from exercising any such right if,
in the Secured Party's judgment, such action would have a material adverse
effect on the value of the Pledged Collateral or any part thereof; and provided
--------
further, that the Pledgor shall give the Secured Party at least five business
- -------
days' written notice of the manner in which it intends to exercise, or its
reasons for refraining from exercising, any such right.
(ii) The Pledgor shall be entitled to receive and retain any and all
dividends and other distributions paid in respect of the Pledged Collateral
owned by the Pledgor, other than any and all
(A) dividends and other distributions paid or payable other than in
cash in respect of, and instruments and
-6-
<PAGE>
other property received, receivable or otherwise distributed in respect of, or
in exchange for, any Pledged Collateral,
(B) dividends and other distributions paid or payable in cash in
respect of any Pledged Shares in connection with a partial or total liquidation
or dissolution or in connection with a reduction of capital, capital surplus or
paid-in-surplus,
(C) cash paid, payable or otherwise distributed in redemption of, or
in exchange for, any Pledged Collateral, and
(D) Company Stock received upon exchange of the Partnership Interests,
all of which shall be forthwith delivered to the Secured Party to hold as
Pledged Collateral and shall, if received by the Pledgor, be received in trust
for the benefit of the Secured Party, be segregated from the other property or
funds of the Pledgor, and be forthwith delivered to the Secured Party as Pledged
Collateral in the same form as so received (with any necessary endorsement).
(iii) The Secured Party shall execute and deliver (or cause to be
executed and delivered) to the Pledgor all such proxies and other instruments as
the Pledgor may reasonably request for the purpose of enabling the Pledgor to
exercise the voting and other rights which it is entitled to exercise pursuant
to paragraph (i) above and to receive the dividends or other distributions which
it is authorized to receive and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an Event of
Default:
(i) Upon notice by the Secured Party to the Pledgor, all rights of the
Pledgor to exercise the voting and other consensual rights which it would
otherwise be entitled to exercise pursuant to Section 6(a)(i) above shall cease,
and all such rights shall thereupon become vested in the Secured Party who shall
thereupon have the sole right to exercise such voting and other consensual
rights.
(ii) All rights of the Pledgor to receive the dividends and other
distributions which it would otherwise be authorized to receive and retain
pursuant to Section 6(a)(ii) above shall cease, and all such rights shall
thereupon become vested in the Secured Party who shall thereupon have the sole
right to receive and hold as Pledged Collateral such dividends and other
distributions.
(iii) All dividends and other distributions, and any Company Stock
received in exchange for the Partnership Interests, which are received by the
Pledgor contrary to the provisions of paragraph (ii) of this Section 6(b) shall
be received in trust
-7-
<PAGE>
for the benefit of the Secured Party, shall be segregated from other funds of
the Pledgor and shall be forthwith paid over to the Secured Party as Pledged
Collateral in the same form as so received (with any necessary endorsement).
(iv) The Pledgor shall, if necessary to permit the Secured Party to
exercise the voting and other rights which it may be entitled to exercise
pursuant to Section 6(b)(i) above and to receive all dividends and distributions
which it may be entitled to receive under Section 6(b)(ii) above, execute and
deliver to the Secured Party, from time to time and upon written notice of the
Secured Party, appropriate proxies, dividend payment orders and other
instruments as the Secured Party may reasonably request. The foregoing shall
not in any way limit the Secured Party's power and authority granted pursuant to
Section 8 hereof.
SECTION 7. Transfers and other Liens. (a) The Pledgor agrees that
-------------------------
it will not (i) sell or otherwise dispose of, or grant any option or warrant
with respect to, any of the Collateral, or (ii) create or permit to exist any
lien, security interest, option or other charge or encumbrance upon or with
respect to any of the Collateral, except for (A) the lien created pursuant to
this Pledge Agreement and (B) the lien created by the Citibank Pledge Agreement.
(b) The Pledgor agrees that it will cause each issuer of the Pledged
Shares not to issue any shares of stock or other securities in addition to or in
substitution for the Pledged Shares, except, with the written consent of the
Secured Party, to the Pledgor.
(c) The Pledgor shall at its expense:
(i) perform and observe all the terms and provisions of the Assigned
Agreement to be performed or observed by it, maintain the Assigned Agreement in
full force and effect, enforce the Assigned Agreement in accordance with its
terms, and take all such action to such end as may be from time to time
reasonably requested by the Secured Party; and
(ii) furnish to the Secured Party promptly upon receipt thereof copies
of all notices, requests and other documents received by the Pledgor under or
pursuant to the Assigned Agreement, and from time to time (A) furnish to the
Secured Party such information and reports regarding the Assigned Agreement as
the Secured Party may reasonably request and (B) upon request of the Secured
Party make to any other party to the Assigned Agreement such demands and
requests for information and reports or for action as the Pledgor is entitled to
make thereunder.
(d) The Pledgor shall not:
-8-
<PAGE>
(i) cancel or terminate the Assigned Agreement or consent to or accept
any cancellation or termination thereof;
(ii) amend or otherwise modify the Assigned Agreement or give any
consent, waiver or approval thereunder;
(iii) waive any default under or breach of the Assigned Agreement; or
(iv) take any other action in connection with the Assigned Agreement
which would impair the value of the interest or rights of the Pledgor thereunder
or which would impair the interest or rights of the Secured Party.
SECTION 8. Secured Party Appointed Attorney-in-Fact and Proxy. The
--------------------------------------------------
Pledgor hereby irrevocably constitutes and appoints the Secured Party and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact and proxy with full irrevocable power and authority in
the place and stead of the Pledgor and in the name of the Pledgor or in its own
name, from time to time in the Secured Party's discretion, for the purpose of
carrying out the terms of this Pledge Agreement, to take any and all appropriate
action and to execute and deliver any and all documents and instruments which
the Secured Party may deem necessary or advisable to accomplish the purposes of
this Pledge Agreement, including, without limitation, to receive, endorse and
collect all instruments made payable to the Pledgor representing any dividend or
other distribution or payment in respect of the Collateral or any part thereof,
to give full discharge for the same, and to vote or grant any consent in respect
of the Pledged Shares authorized by Section 6(b) hereof. The Pledgor hereby
ratifies, to the extent permitted by law, all that any said attorney shall
lawfully do or cause to be done by virtue hereof. This power, being coupled with
an interest, is irrevocable until the Obligations are indefeasibly paid in full.
SECTION 9. Secured Party May Perform. If the Pledgor fails to
-------------------------
perform any agreement contained herein, the Secured Party may itself perform, or
cause performance of, such agreement, and the expenses of the Secured Party
incurred in connection therewith shall be payable by the Pledgor under Section
12 hereof and constitute Obligations secured hereby.
SECTION 10. Reasonable Care. The Secured Party shall be deemed to
---------------
have exercised reasonable care in the custody and preservation of the Collateral
in its possession if the Collateral is accorded treatment substantially equal to
that which the Secured Party accords its own property, it being understood that
the Secured Party shall not have responsibility for (i) ascertaining or taking
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relative to any Collateral, whether or not the Secured Party has
or is deemed to have knowledge of any such matter, or (ii) taking
-9-
<PAGE>
any necessary steps to preserve rights against any person with respect to any
Collateral.
SECTION 11. Remedies Upon Default. If any Event of Default shall have
---------------------
occurred and be continuing:
(a) The Secured Party may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party after default under the
Uniform Commercial Code (the "Code") in effect in the State of New York at that
time, and the Secured Party may also, without notice except as specified below,
sell the Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange, broker's board or at any office of the Secured
Party or elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Secured Party may deem commercially reasonable. The Pledgor
agrees that, to the extent notice of sale shall be required by law, at least 10
days' notice to the Pledgor of the time and place of any public sale or the time
after which any private sale is to be made shall constitute reasonable
notification. The Secured Party shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The Secured Party
may adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned. The Pledgor hereby
waives any claims against the Secured Party arising by reason of the fact that
the price at which any Collateral may have been sold at such a private sale was
less than the price which might have been obtained at a public sale, even if the
Secured Party accepts the first offer received and does not offer such
Collateral to more than one offeree.
(b) If the Secured Party shall determine to exercise its right to sell
all or any of the Pledged Collateral pursuant to this Section 11, the Pledgor
agrees that, upon request of the Secured Party, the Pledgor will, at its own
cost and expense:
(i) execute and deliver, and use its best efforts to cause each issuer
of the Pledged Shares and its directors, officers and/or partners to execute and
deliver, all such instruments and documents, and do or cause to be done all such
other acts and things, as may be necessary or, in the opinion of the Secured
Party, necessary or advisable to register such Pledged Shares under the
provisions of the Securities Act of 1933, as from time to time amended (the
"Securities Act"), and to cause the registration statement relating thereto to
become effective and to remain effective for such period as prospectuses are
required by law to be furnished, and to make or cause to be made all amendments
and supplements thereto and to the related prospectus which, in the opinion of
the Secured Party, are necessary or advisable, all in conformity with the
requirements
-10-
<PAGE>
of the Securities Act and the rules and regulations of the Securities and
Exchange Commission ("SEC") applicable thereto;
(ii) use its best efforts to qualify the Pledged Collateral under the
state securities or "Blue Sky" laws and to obtain all necessary governmental
approvals for the sale of the Pledged Collateral, as requested by the Secured
Party;
(iii) make available to its security holders, as soon as practicable,
an earning statement which will satisfy the provisions of section 11(a) of the
Securities Act;
(iv) obtain all approvals, authorizations and consents as may be
required under applicable law and regulations (including gaming laws and
regulations); and
(v) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Pledged Collateral or any part thereof valid
and binding and in compliance with applicable law.
The Pledgor further acknowledges the impossibility of ascertaining the amount of
damages which would be suffered by the Secured Party by reason of the failure by
the Pledgor to perform any of the covenants contained in this Section 11 and,
consequently, agrees that, if the Pledgor shall fail to perform any of such
covenants, it shall pay, as liquidated damages and not as a penalty, an amount
equal to the value of the Collateral on the date the Secured Party shall demand
compliance with this Section.
(c) The Pledgor recognizes that, by reason of the aforementioned
requirements and certain prohibitions contained in the Securities Act and
applicable state securities laws, the Secured Party may, at its option, elect
not to require the Pledgor to register all or any part of the Pledged Collateral
and may therefore be compelled, with respect to any sale of all or any part of
the Pledged Collateral, to limit purchasers to those who will agree, among other
things, to acquire such securities for their own account, for investment, and
not with a view to the distribution or resale thereof. The Pledgor acknowledges
and agrees that any such sale may result in prices and other terms less
favorable to the seller than if such sale were a public sale without such
restrictions and, notwithstanding such circumstances, agrees that any such sale
shall be deemed to have been made in a commercially reasonable manner. The
Secured Party shall be under no obligation to delay the sale of any of the
Pledged Collateral for the period of time necessary to permit the Pledgor to
register such securities for public sale under the Securities Act, or under
applicable state securities laws, even if the Pledgor would agree to do so.
(d) If the Secured Party determines to exercise its right to sell any
or all of the Pledged Collateral, upon written
-11-
<PAGE>
request, the Pledgor shall, and shall use best efforts to cause the Company to,
from time to time, furnish to the Secured Party all such information as the
Secured Party may request in order to determine the number of shares and other
instruments included in the Pledged Collateral which may be sold by the Secured
Party as exempt transactions under the Act and rules of the SEC thereunder, as
the same are from time to time in effect.
(e) The Secured Party may exercise any and all rights and remedies of
the Pledgor under or in connection with the Assigned Agreement, including,
without limitation, any and all rights of the Pledgor to demand or otherwise
require payment of any amount under, or performance of any provision of, the
Assigned Agreement.
(f) All payments received by the Pledgor under or in connection with
the Assigned Agreement or otherwise in respect of the Collateral shall be
received in trust for the benefit of the Secured Party, shall be segregated from
other funds of the Pledgor and shall be forthwith paid over to the Secured Party
in the same form as so received (with any necessary endorsement).
(g) Any cash held by the Secured Party as Collateral and all cash
proceeds received by the Secured Party in respect of any sale of, collection
from, or other realization upon all or any part of the Collateral shall be
applied by the Secured Party:
First, to the payment of the costs and expenses of such sale,
-----
including, without limitation, reasonable expenses of the Secured Party and its
agents including the fees and expenses of its counsel, and all expenses,
liabilities and advances made or incurred by the Secured Party in connection
therewith or pursuant to Section 9 hereof;
Next, to the Secured Party for the payment in full of the Obligations;
----
and
Finally, after payment in full of all of the Obligations, subject to
-------
the terms of the Intercreditor Agreement, to the extent such amounts are not
required to be paid to Citibank pursuant thereto, to the payment to the Pledgor
or its successors or assigns, or to whomsoever may be lawfully entitled to
receive the same as a court of competent jurisdiction may direct.
SECTION 12. Expenses. The Pledgor will upon demand pay to the Secured
--------
Party the amount of any and all reasonable expenses, including, without
limitation, the reasonable fees and expenses of the Secured Party's counsel and
of any experts and agents, which the Secured Party may incur in connection with
(i) the administration of this Pledge Agreement, (ii) the custody or
preservation of, sale of, collection from, or other realization upon, any of the
Collateral, (iii) the exercise or enforcement of any of the rights and remedies
hereunder of the Secured Party, or
-12-
<PAGE>
(iv) the failure by the Pledgor to perform or observe any of the provisions
hereof.
SECTION 13. Security Interest Absolute. All rights of the Secured
--------------------------
Party and security interests hereunder, and all obligations of the Pledgor
hereunder, shall be absolute and unconditional irrespective of:
(i) any lack of validity or enforceability of any provision of this
Pledge Agreement, the Loan Agreement, the Notes or any other Loan Document or
any other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payment of, or in any
other term of, or any increase in the amount of, all or any of the Obligations,
or any other amendment or waiver of any term of, or any consent to any departure
from any requirement of, this Pledge Agreement, the Loan Agreement, the Notes or
any other Loan Document;
(iii) any exchange, release or non-perfection of any lien on any
other collateral, or any release or amendment or waiver of any term of any
guaranty of, or consent to departure from any requirement of any guaranty of,
all or any of the Obligations; or
(iv) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, a borrower or a pledgor.
SECTION 14. Amendments, Etc. No amendment or waiver of any
---------------
provision of this Pledge Agreement nor consent to any departure by the Pledgor
herefrom shall in any event be effective unless the same shall be in writing and
signed by the Secured Party, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
SECTION 15. Addresses for Notices. All notices and other
---------------------
communications provided for hereunder shall be in writing and shall be delivered
to the addresses set forth in, and deemed delivered as set forth in, the Loan
Agreement.
SECTION 16. Continuing Security Interest; Transfer of Notes or
--------------------------------------------------
Obligations. This Pledge Agreement shall create a continuing security interest
- -----------
in the Collateral and shall (i) remain in full force and effect until
indefeasible payment in full of the obligations, (ii) be binding upon the
Pledgor, the Pledgor's heirs, legal representatives, successors and assigns and
(iii) inure, together with the rights and remedies of the Secured Party
hereunder, to the benefit of and be enforceable by the Secured Party and its
respective successors, transferees and assigns. Without limiting the generality
of the foregoing clause (iii), the Secured Party may assign or otherwise
transfer any
-13-
<PAGE>
Note held by it or Obligation owing to it to any other Person, and such other
Person shall thereupon become vested with all the rights in respect thereof
granted to the Secured Party herein or otherwise with respect to such of the
Notes or Obligations so transferred or assigned. Upon the indefeasible payment
in full of the Obligations, the Pledgor shall be entitled to the return, upon
its request and at its expense, of such of the Collateral owned by the Pledgor
as shall not have been sold or otherwise applied pursuant to the terms hereof.
SECTION 17. Governing Law; Severability Terms. This Pledge Agreement
---------------------------------
shall be governed by, and be construed and interpreted in accordance with, the
law of the State of New York without regard to conflicts of law principles
thereof. Wherever possible, each provision of this Pledge Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Pledge Agreement shall be prohibited by or invalid
under applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity and without invalidating the remaining provisions
of this Pledge Agreement. Unless otherwise defined herein or in the Agreement,
terms defined in Article 9 of the Uniform Commercial Code as in effect in the
State of New York are used herein as therein defined.
SECTION 18. Waiver of Jury Trial. The Pledgor waives any right it may
--------------------
have to a trial by jury in respect of any litigation based on, or arising out
of, under or in connection with, this Pledge Agreement or any other Loan
Document, or any course of conduct, course of dealing, verbal or written
statement or other action of the Pledgor or the Secured Party.
SECTION 19. Section Titles. The Section titles contained in this
--------------
Pledge Agreement are and shall be without substantive meaning or content of any
kind whatsoever and are not part of this Pledge Agreement.
-14-
<PAGE>
SCHEDULE I TO PLEDGE AGREEMENT
Attached to and forming a part of that certain Pledge and Security Agreement,
dated as of April 17, 1996, made by Donald J. Trump and Trump Taj Mahal, Inc. to
Donaldson, Lufkin & Jenrette, Inc., as Secured Party.
First Lien Shares
-----------------
<TABLE>
<CAPTION>
Class of Stock Certificate Number of Shares Percentage of
Pledgor Issuer or Interest No(s). Par Value or Interest Total Outstanding
- --------- ------------- -------------- ------------ ---------------- ---------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
1. Donald Trump Hotels Limited 40 units 40%
J. Trump & Casino Partnership
Resorts Interests
Holdings,
L.P.
2. Donald Trump Hotels Class B $0.01 800 80%
J. Trump & Casino Common
Resorts, Inc. Stock
</TABLE>
<PAGE>
SCHEDULE II TO PLEDGE AGREEMENT
Attached to and forming a part of that certain Pledge and Security Agreement,
dated as of April 17, 1996, made by Donald J. Trump and Trump Taj Mahal, Inc. to
Donaldson, Lufkin & Jenrette, Inc., as Secured Party.
Second Lien Shares
------------------
<TABLE>
<CAPTION>
Class of Stock Certificate Number of Shares Percentage of
Pledgor Issuer or Interest No(s). Par Value or Interest Total Outstanding
- --------- ---------- -------------- ----------- ---------------- ------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
1. Trump Trump Hotels Limited 60 units 40%
Taj Mahal, & Casino Partnership
Inc. Resorts Interests
Holdings,
L.P.
2. Trump Trump Hotels Class B $0.01 200 80%
Taj Mahal, & Casino Common
Inc. Resorts, Inc. Stock
</TABLE>
<PAGE>
IN WITNESS WHEREOF, the Pledgor has duly executed and delivered this
Pledge Agreement on the date first above written.
/s/
------------------------------------
Donald J. Trump
TRUMP TAJ MAHAL, INC.
By: /s/
---------------------------------
Name: Donald J. Trump
Title: President
Accepted and Acknowledged:
DONALDSON, LUFKIN & JENRETTE, INC.,
as Secured Party
By: /s/
------------------------------------
Name:
Title:
<PAGE>
Exhibit VI.II: Pledge and Security Agreement among Donald J. Trump, Trump
Casinos, Inc. and Citibank, N.A., dated April 17, 1996.
<PAGE>
EXHIBIT VI.II
- -------------
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated April 17, 1996, made by Donald J. Trump
("DJT") and each of the DJT Entities (as defined in the Agreement referred to
below) listed on the signature pages hereof (DJT and each such DJT Entity being
hereinafter referred to individually as a "Pledgor" and collectively as the
"Pledgors"), to Citibank, N.A., as agent for the lenders party to the Agreement
referred to below (in such capacity, the "Agent").
W I T N E S S E T H:
--------------------
WHEREAS, DJT has entered into an Amendment, Restatement and
Consolidation of Recourse Claims Agreement, dated as of April 11, 1996, with the
lenders party thereto (the "Lenders") and the Agent (said Agreement, as it may
be amended or otherwise modified from time to time, being the "Agreement" and
capitalized terms not defined herein but defined therein being used herein as
therein defined); and
WHEREAS, each Pledgor is the legal and beneficial owner of the shares
of capital stock and certificated partnership interests described in Schedule I
hereto as being owned by such Pledgor and issued by the issuers named therein
(the "Pledged Shares"); and
WHEREAS, it is a condition precedent to the effectiveness of the
Agreement that the each Pledgor shall have made the pledge contemplated by this
Agreement;
NOW, THEREFORE, in consideration of the premises, each Pledgor hereby
agrees with the Agent on behalf and for the benefit of the Secured Parties as
follows:
SECTION 1. Pledge. Each Pledgor hereby pledges to the Agent on behalf and
------
for the benefit of the Secured Parties, and grants to the Agent on behalf and
for the benefit of the Parties a security interest in, the following (the
"Pledged Collateral"):
(i) all of the Pledged Shares;
(ii) all additional shares of stock or other securities of any issuer
of the Pledged Shares from time to time acquired by such Pledgor in any
manner and all shares of stock or other securities of any Person who, after
the date of this Agreement, becomes, as a
<PAGE>
result of any occurrence, a DJT Entity (any such shares being "Additional
Shares");
(iii) the certificates representing the shares referred to in clauses
(i) and (ii) above; and
(iv) all dividends, distributions, cash, instruments and other property
or proceeds, from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the foregoing.
SECTION 2. Security for Obligations. This Pledge Agreement secures and
------------------------
the Pledged Collateral is security for the full and prompt payment when due
(whether at stated maturity, by acceleration or otherwise) of, and the
performance of, the Obligations, whether now or hereafter existing and whether
for principal, interest, fees, expenses or otherwise.
SECTION 3. Delivery of Pledged Collateral. All certificates or
------------------------------
instruments representing or evidencing the Pledged Collateral shall be delivered
to and held by or on behalf of the Agent pursuant hereto and shall be in
suitable form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
satisfactory to the Agent, except that the Pledged Shares indicated on Schedule
I hereto as being subject to a first lien in favor of Donaldson, Lufkin and
Jenrette, Inc. ("DLJ") are being delivered to DLJ as agent and bailee for the
Agent. The Agent shall have the right, at any time in its discretion and without
notice to any Pledgor, to transfer to or to register in its name or in the name
of any of its nominees any or all of the Pledged Collateral. In addition, the
Agent shall have the right at any time to exchange certificates or instruments
representing or evidencing any of the Pledged Collateral for certificates or
instruments of smaller or larger denominations.
SECTION 4. Representations and Warranties. Each Pledgor makes the
-------------------------------
following representations:
(a) The Pledged Shares owned by such Pledgor (i) have been duly authorized
and validly issued; (ii) are fully paid and non-assessable; and (iii) constitute
the percentage of the issued and outstanding shares of stock or partnership
interests of the respective issuers thereof set forth on Schedule I.
(b) Such Pledgor is the legal and beneficial owner of the Pledged
Collateral associated with the Pledged Shares described on Schedule I as being
owned by such Pledgor free and clear of any Lien, except for the Lien created by
this Pledge Agreement, the Liens of DLJ referred to in the DLJ Intercreditor
Agreement and the Liens of Bankers Trust Company referred to in the BT
Intercreditor Agreement.
-2-
<PAGE>
(c) The pledge of the Pledged Shares pursuant to this Pledge Agreement
creates a valid and perfected first priority (or, in the case of the Pledged
Shares indicated on Schedule I as being subject to a first lien in favor of DLJ,
second priority) security interest in the Pledged Collateral, in favor of the
Agent on behalf and for the ratable benefit of the Secured Parties securing the
payment of all of the Obligations.
(d) No consent, authorization, approval, or other action by, and no notice
to or filing with, any Governmental Authority is required either (i) for the
pledge by such Pledgor of the Pledged Collateral owned by such Pledgor pursuant
to this Pledge Agreement or for the due execution, delivery or performance of
this Pledge Agreement by such Pledgor, or (ii) for the exercise by the Agent of
the voting or other rights provided for in this Pledge Agreement or of the
remedies in respect of the Pledged Collateral pursuant to this Pledge Agreement,
except for any required approval of the Casino Control Commission or the
Division of Gaming Enforcement or as may be required in connection with the
disposition of the Pledged Collateral by laws affecting the offering and sale of
securities generally.
SECTION 5. Further Assurances, Etc.
------------------------
(a) Each Pledgor agrees that at any time and from time to time, at the cost
and expense of such Pledgor, such Pledgor will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable, or that the Agent may request, in order to perfect and
protect the Lien granted or purported to be granted hereby or to enable the
Agent to exercise and enforce its rights and remedies hereunder with respect to
any Pledged Collateral.
(b) Each Pledgor agrees to defend the title to the Pledged Collateral and
the Lien thereon of the Agent against the claim of any other Person and to
maintain and preserve such Lien until indefeasible payment in full of all of the
Obligations.
SECTION 6. Voting Rights; Dividends; Etc.
------------------------------
(a) As long as no Default or Event of Default shall have occurred and be
continuing (or, in the case of subsection (a)(i) of this Section 6, as long as
no notice thereof shall have been given by the Agent to DJT):
(i) Each Pledgor shall be entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Collateral owned by such
Pledgor or any part thereof for any purpose not inconsistent with the terms
of this Pledge Agreement or any other Loan Document; provided, however,
--------- --------
that such Pledgor shall not exercise o shall refrain from exercising any
such right if such action would have a material adverse effect on the value
of the Pledged
-3-
<PAGE>
Collateral or any part thereof; and provided, further, that Trump Taj
Mahal, Inc. shall give the Agent at least five Business Days' written
notice of the manner in which it intends to exercise, or its reasons for
refraining from exercising, any such right.
(ii) Each Pledgor shall be entitled to receive and retain any and all
dividends and other distributions paid in respect of the Pledged Collateral
owned by such Pledgor, other than any and all
(A) dividends and other distributions paid or payable other than
in cash in respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange for,
any Pledged Collateral,
(B) dividends and other distributions paid or payable in cash in
respect of any Pledged Shares or Additional Pledged Shares in
connection with a partial or total liquidation or dissolution or in
connection with a reduction of capital, capital surplus or paid-in-
surplus, and
(C) cash paid, payable or otherwise distributed in redemption of,
or in exchange for, any Pledged Collateral,
all of which shall be forthwith delivered to the Agent to hold as
Pledged Collateral and shall, if received by any Pledgor, be received
in trust for the benefit of the Agent, be segregated from the other
property or funds of such Pledgor, and be forthwith delivered to the
Agent as Pledged Collateral in the same form as so received (with any
necessary endorsement).
(iii) The Agent shall execute and deliver (or cause to be executed and
delivered) to any Pledgor all such proxies and other instruments as such
Pledgor may reasonably request for the purpose of enabling such Pledgor to
exercise the voting and other rights which it is entitled to exercise
pursuant to paragraph (i) above and to receive the dividends or other
distributions which it is authorized to receive and retain pursuant to
paragraph (ii) above.
(b) Upon the occurrence and during the continuance of a Default or an Event
of Default:
(i) Upon notice by the Agent to DJT, all rights of any Pledgor to
exercise the voting and other consensual rights which it would otherwise be
entitled to exercise pursuant to Section 6(a)(i) above shall cease, and all
such rights shall thereupon become vested in the Agent who shall thereupon
have the sole
-4-
<PAGE>
right to exercise such voting and other consensual rights.
(ii) All rights of any Pledgor to receive the dividends and other
distributions which it would otherwise be authorized to receive and retain
pursuant to Section 6(a)(ii) above shall cease, and all such rights shall
thereupon become vested in the Agent who shall thereupon have the sole
right to receive and hold as Pledged Collateral such dividends and other
distributions.
(iii) All dividends and other distributions which are received by any
Pledgor contrary to the provisions of paragraph (ii) of this Section 6(b)
shall be received in trust for the benefit of the Agent, shall be
segregated from other funds of such Pledgor and shall be forthwith paid
over to the Agent as Pledged Collateral in the same form as so received
(with any necessary endorsement).
(iv) Each Pledgor shall, if necessary to permit the Agent to exercise
the voting and other rights which it may be entitled to exercise pursuant
to Section 6(b)(i) above and to receive all dividends and distributions
which it may be entitled to receive under Section 6(b)(ii) above, execute
and deliver to the Agent, from time to time and upon written notice of the
Agent, appropriate proxies, dividend payment orders and other instruments
as the Agent may reasonably request. The foregoing shall not in any way
limit the Agent's power and authority granted pursuant to Section 8 hereof.
SECTION 7. Transfers and Other Liens; Additional Shares.
---------------------------------------------
(a) Each Pledgor agrees that it will not (i) sell or otherwise dispose of,
or grant any option or warrant with respect to, any of the Pledged Collateral,
or (ii) create or permit to exist any Lien upon or with respect to any of the
Pledged Collateral, except for the Lien created pursuant to this Pledge
Agreement and the Liens referred to in Section 4(b) hereof.
(b) Each Pledgor agrees that it will (i) cause each issuer of the Pledged
Shares not to issue any shares of stock or other securities in substitution for
or, in the case of a DJT Entity, in addition to, the Pledged Shares, except,
with the written consent of the Majority Lenders, to such Pledgor, (ii) pledge
hereunder, immediately upon its acquisition (directly or indirectly) thereof,
any and all Additional Shares, and (iii) promptly (and in any event within three
Business Days) deliver to the Agent a Pledge Amendment, duly executed by such
Pledgor, in substantially the form of Schedule II hereto (a "Pledge
-5-
<PAGE>
Amendment"), in respect of the Additional Shares, together with all certificates
or other instruments representing or evidencing the same. Each Pledgor hereby
(i) authorizes the Agent to attach each Pledge Amendment to this Pledge
Agreement, (ii) agrees that all Additional Shares listed on any Pledge Amendment
delivered to the Agent shall for all purposes hereunder constitute Pledged
Shares, and (iii) is deemed to have made, upon such delivery, the
representations and warranties contained in Section 4 hereof with respect to
such Pledged Collateral.
SECTION 8. Agent Appointed Attorney-in-Fact and Proxy. Each Pledgor hereby
------------------------------------------
irrevocably constitutes and appoints the Agent and any officer or agent thereof,
with full power of substitution, as its true and lawful attorney-in-fact and
proxy with full irrevocable power and authority in the place and stead of such
Pledgor and in the name of such Pledgor or in its own name, from time to time in
the Agent's discretion, for the purpose of carrying out the terms of this Pledge
Agreement, to take any and all appropriate action and to execute and deliver any
and all documents and instruments which the Agent may deem necessary or
advisable to accomplish the purposes of this Pledge Agreement, including,
without limitation, to receive, endorse and collect all instruments made payable
to such Pledgor representing any dividend or other distribution or payment in
respect of the Pledged Collateral or any part thereof, to give full discharge
for the same, and to vote or grant any consent in respect of the Pledged Shares
authorized by Section 6(b) hereof. Each Pledgor hereby ratifies, to the extent
permitted by law, all that any said attorney shall lawfully do or cause to be
done by virtue hereof. This power, being coupled with an interest, is
irrevocable until the Obligations are indefeasibly paid in full.
SECTION 9. Agent May Perform. If any Pledgor fails to perform any
-----------------
agreement contained herein, the Agent may itself perform, or cause performance
of, such agreement, and the expenses of the Agent incurred in connection
therewith shall be payable by the Pledgors under Section 12 hereof and
constitute Obligations secured hereby.
SECTION 10. Reasonable Care. The Agent shall be deemed to have exercised
---------------
reasonable care in the custody and preservation of the Pledged Collateral in its
possession if the Pledged Collateral is accorded treatment substantially equal
to that which the Agent accords its own property, it being understood that
neither the Agent nor any other Secured Party shall have responsibility for (i)
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Pledged Collateral, whether
or not the Agent or any other Secured Party has or is deemed to have knowledge
of any such matter, or (ii) taking any necessary steps to preserve rights
against any Person with respect to any Pledged Collateral.
-6-
<PAGE>
SECTION 11. Remedies upon Default. If any Event of Default shall have
---------------------
occurred and be continuing:
(a) The Agent may exercise in respect of the Pledged Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party after default under the
Uniform Commercial Code (the "Code") in effect in the State of New York at that
time, and the Agent may also, without notice except as specified below, sell the
Pledged Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange, broker's board or at any office of the Agent or
elsewhere, for cash, on credit or for future delivery, and upon such other terms
as the Agent may deem commercially reasonable. Each Pledgor agrees that, to the
extent notice of sale shall be required by law, at least ten days' notice to DJT
of the time and place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification. The Agent shall not
be obligated to make any sale of Pledged Collateral regardless of notice of sale
having been given. The Agent may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned. Each Pledgor hereby waives any claims against the Agent arising by
reason of the fact that the price at which any Pledged Collateral may have been
sold at such a private sale was less than the price which might have been
obtained at a public sale, even if the Agent accepts the first offer received
and does not offer such Pledged Collateral to more than one offeree.
(b) If the Agent shall determine to exercise its right to sell all or any
of the Pledged Collateral pursuant to this Section 11, each Pledgor agrees that,
upon request of the Agent, such Pledgor will, at its own cost and expense:
(i) execute and deliver, and use its best efforts to cause each issuer
of the Pledged Shares and its directors, officers and/or partners to
execute and deliver, all such instruments and documents, and do or cause to
be done all such other acts and things, as may be necessary or, in the
opinion of the Agent, necessary or advisable to register such Pledged
Shares under the provisions of the Securities Act of 1933, as from time to
time amended (the "Securities Act"), and to cause the registration
statement relating thereto to become effective and to remain effective for
such period as prospectuses are required by law to be furnished, and to
make all amendments and supplements thereto and to the related prospectus
which, in the opinion of the Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission ("SEC") applicable
thereto;
-7-
<PAGE>
(ii) use its best efforts to qualify the Pledged Collateral under the
state securities or "Blue Sky" laws and to obtain all necessary
governmental approvals for the sale of the Pledged Collateral, as requested
by the Agent;
(iii) make available to its security holders, as soon as practicable,
an earning statement which will satisfy the provisions of section 11(a) of
the Securities Act; and
(iv) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Pledged Collateral or any part thereof
valid and binding and in compliance with applicable law.
Each Pledgor further acknowledges the impossibility of ascertaining the amount
of damages which would be suffered by the Secured Parties by reason of the
failure by such Pledgor to perform any of the covenants contained in this
Section 11 and, consequently, agrees that, if any Pledgor shall fail to perform
any of such covenants, it shall pay, as liquidated damages and not as a penalty,
an amount equal to the value of the Pledged Collateral on the date the Agent
shall demand compliance with this Section.
(c) Each Pledgor recognizes that, by reason of the aforementioned
requirements and certain prohibitions contained in the Securities Act and
applicable state securities laws, the Agent may, at its option, elect not to
require such Pledgor to register all or any part of the Pledged Collateral and
may therefore be compelled, with respect to any sale of all or any part of the
Pledged Collateral, to limit purchasers to those who will agree, among other
things, to acquire such securities for their own account, for investment, and
not with a view to the distribution or resale thereof. Each Pledgor acknowledges
and agrees that any such sale may result in prices and other terms less
favorable to the seller than if such sale were a public sale without such
restrictions and, notwithstanding such circumstances, agrees that any such sale
shall be deemed to have been made in a commercially reasonable manner. The Agent
shall be under no obligation to delay the sale of any of the Pledged Collateral
for the period of time necessary to permit any Pledgor to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if the issuer of such Pledged Collateral would agree to do
so.
(d) If the Agent determines to exercise its right to sell any or all of the
Pledged Collateral, upon written request, each Pledgor shall, from time to time,
furnish to the Agent all such information as the Agent may request in order to
determine the number of shares and other instruments included in the
-8-
<PAGE>
Pledged Collateral which may be sold by the Agent as exempt transactions under
the Act and rules of the SEC thereunder, as the same are from time to time in
effect.
(e) Any cash held by the Agent as Pledged Collateral and all cash proceeds
received by the Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Pledged Collateral shall be applied by
the Agent:
First, to the payment of the costs and expenses of such sale,
including, without limitation, reasonable expenses of the Agent and its agents
including the fees and expenses of its counsel, and all expenses, liabilities
and advances made or incurred by the Agent in connection therewith or pursuant
to Section 9 hereof;
Next, to the Secured Parties, pro rata, for the payment in full of the
--- ----
Obligations; and
Finally, after payment in full of all of the Obligations, as provided
in the DLJ Intercreditor Agreement, or the BT Intercreditor Agreement, as
applicable, and, to the extent such amounts are not required to be paid to DLJ
or Bankers Trust Company pursuant thereto, to the payment to the Pledgor that
owns such Pledged Collateral, or its successors or assigns, or to whomsoever may
be lawfully entitled to receive the same as a court of competent jurisdiction
may direct.
SECTION 12. Expenses. The Pledgors, jointly and severally, will upon
--------
demand pay to the Agent the amount of any and all reasonable expenses,
including, without limitation, the reasonable fees and expenses of the Agent's
counsel and of any experts and agents, which the Agent may incur in connection
with (i) the administration of this Pledge Agreement, (ii) the custody or
preservation of, sale of, collection from, or other realization upon, any of the
Pledged Collateral, (iii) the exercise or enforcement of any of the rights and
remedies hereunder of the Agent and the Secured Parties, or (iv) the failure by
any Pledgor to perform or observe any of the provisions hereof.
SECTION 13. Security Interest Absolute. All rights of the Agent and
--------------------------
security interests hereunder, and all obligations of the Pledgors hereunder,
shall be absolute and unconditional irrespective of:
(i) any lack of validity or enforceability of any provision of the
Agreement, the Notes or any other Loan Document or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or place of payment of, or in any
other term of, or any increase in
-9-
<PAGE>
the amount of, all or any of the Obligations, or any other amendment or
waiver of any term of, or any consent to any departure from any requirement
of, the Agreement, the Notes or any other Loan Document;
(iii) any exchange, release or non-perfection of any Lien on any other
collateral, or any release or amendment or waiver of any term of any
guaranty of, or consent to departure from any requirement of any guaranty
of, all or any of the Obligations; or
(iv) any other circumstance which might otherwise constitute a defense available
to, or a discharge of, a borrower or a pledgor.
SECTION 14. Amendments, Etc. No amendment or waiver of any provision of this
---------------
Pledge Agreement nor consent to any departure by any Pledgor herefrom shall in
any event be effective unless the same shall be in writing, approved by the
Majority Lenders and signed by the Agent, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given.
SECTION 15. Addresses for Notices. All notices and other communications
---------------------
provided for hereunder shall be in writing (including telegraphic, telex,
telecopy or cable communication) and mailed, telegraphed, telexed, telecopied,
cabled or delivered by hand, if to any Pledgor, addressed to DJT on behalf of
such Pledgor, and if to any Secured Party, addressed to such Secured Party, in
either case at the address specified in the Agreement, or at such other address
as shall be designated by DJT or such Secured Party in a written notice to each
other party complying as to delivery with the terms of the Agreement. All such
notices and other communications shall, when mailed, telegraphed, telexed,
telecopied, cabled or delivered, be effective when deposited in the mails,
delivered to the telegraph company, confirmed by telex answerback, telecopied
with confirmation of receipt, delivered to the cable company or delivered by
hand to the addressee or its agent, respectively.
SECTION 16. Continuing Security Interest; Transfer of Notes or Obligations.
--------------------------------------------------------------
This Pledge Agreement shall create a continuing security interest in the Pledged
Collateral and shall (i) remain in full force and effect until indefeasible
payment in full of the Obligations, (ii) be binding upon each Pledgor, its
heirs, legal representatives, successors and assigns, and (iii) inure, together
with the rights and remedies of the Agent hereunder, to the benefit of and be
enforceable by the Secured Parties and their respective successors, transferees
and assigns. Without limiting the generality of the foregoing clause (iii), any
Lender may assign or otherwise transfer any Note held by it or Obligation owing
to it to any other Person, and such other Person shall thereupon become vested
with all the rights in respect thereof granted to such Lender herein or
otherwise with
-10-
<PAGE>
respect to such of the Notes or Obligations so transferred or assigned, subject,
however, to compliance with the provisions of Section 9.7 of the Agreement in
respect of assignments. Upon the indefeasible payment in full of the
Obligations, each Pledgor shall be entitled to the return, upon its request and
at its expense, of such of the Pledged Collateral owned by such Pledgor as shall
not have been sold or otherwise applied pursuant to the terms hereof.
SECTION 17. Governing Law; Severability; Terms. This Pledge Agreement shall
----------------------------------
be governed by, and be construed and interpreted in accordance with, the law of
the State of New York. Wherever possible, each provision of this Pledge
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Pledge Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity and without
invalidating the remaining provisions of this Pledge Agreement. Unless
otherwise defined herein or in the Agreement, terms defined in Article 9 of the
Uniform Commercial Code as in effect in the State of New York are used herein as
therein defined.
SECTION 18. Waiver of Jury Trial. Each Pledgor waives any right it may have
--------------------
to a trial by jury in respect of any litigation based on, or arising out of,
under or in connection with, this Pledge Agreement or any other Loan Document,
or any course of conduct, course of dealing, verbal or written statement or
other action of any Loan Party or any Secured Party.
SECTION 19. Limitation of Liability. Any term or provision of this Pledge
-----------------------
Agreement or any other Loan Document to the contrary notwithstanding, as to a
DJT Entity the maximum aggregate amount of the Obligations which the Collateral
pledged hereby by such DJT Entity shall secure shall not exceed the maximum
amount for which such DJT Entity can be liable without rendering this Pledge
Agreement and the Liens granted hereunder or any other Loan Document, in each
case only as it relates to such DJT Entity, voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer.
SECTION 20. Contribution. To the extent that, with respect to any DJT
------------
Entity, proceeds of Pledged Collateral pledged hereunder by such DJT Entity are
applied to payment of the Obligations and the amount of such payment exceeds the
amount determined by dividing such DJT Entity's net worth at the date
enforcement hereunder is sought by the aggregate net worth at such date of all
the DJT Entities who are party to this Pledge Agreement or the Security
Agreement, such DJT Entity shall be reimbursed, pursuant to this provision and a
comparable provision in the Security Agreement (to which each DJT Entity a party
thereto but not hereto is a third party beneficiary), by such other DJT Entities
to the end that, if any Pledged Collateral of any DJT Entity is so applied, all
DJT Entities who are party to
-11
<PAGE>
this Pledge Agreement or the Security Agreement shall contribute to payment of
the obligations in the relative proportions of their respective net worths at
the date enforcement hereunder is sought.
SECTION 21. Section Titles. The Section titles contained in this Pledge
--------------
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not part of this Pledge Agreement.
-12-
<PAGE>
IN WITNESS WHEREOF, each Pledgor has duly executed and delivered this
Pledge Agreement on the date first above written.
DONALD J. TRUMP
TC/GP, INC.
TRUMP CASINOS, INC. (formerly known as TRUMP TAJ MAHAL, INC.)
TRUMP SEASHORE ASSOCIATES, INC.
/s/
- --------------------------------
By: Donald J. Trump, individually and in his capacity as a duly authorized
officer, general partner, or other authorized signatory, as the case may
be, of each of the above DJT Entities or of any entity that is a general
partner of any entity listed above.
Accepted and Acknowledged:
CITIBANK, N.A., as Agent
By: /s/
-----------------------
Title:
-13-
<PAGE>
SCHEDULE I TO PLEDGE AGREEMENT
Attached to and forming a part of that certain Pledge Agreement,
dated as of April 17, 1996, by Donald J. Trump ("DJTI") and DJT
Entities named therein to Citibank, N"A., As Agent.
<PAGE>
<TABLE>
<CAPTION>
(Citibank --
Certificated
Interests) Number of Percentage of
Class of Stock Certificate Par Shares or Total
Pledgor Issuer or Interest No.(s) Value Interest Outstanding
- --------------------------- ------------------- ----------------- ----------------- ------- ------------- -------------
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
DJT 220 Management Common 1 None 100 100
Corporation
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Bedford Hills Common 1 $.01 100 100
Corporation
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Briarcliff Common 1 None 100 100
Properties, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT DJT Acquisition Common 2 None 100 100
Corp.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Mar-a-Lago Club, Common 0 None 1 100
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT MWJ Corp. Common 1 None 100 100
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Parc Consulting, Common 1 None 50 100
Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Reg-Tru Equities, Common 1 None 200 100
Ltd.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Rink Foods, Inc. Common 1 None 100 100
- -----------------------------------------------------------------------------------------------------------------------------------
DJT TC/GP, Inc. Common 2 $.01 100 100
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotel Common 1 None 100 100
Management Corp.
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Trump Ice, Inc. Common 1 $.01 100 100
- -----------------------------------------------------------------------------------------------------------------------------------
DJT Trump Common 2 None 100 100
Organization, Inc.
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Payroll Corp. Common 1 None 1 100
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Plaza Common 1 None 100 100
Management Corp.
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Seashore Common 1 None 100 100
Associates, Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump's Castle Common 100 None 1,000,000 100
Hotel & Casino,
Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Taj Mahal, Common 1 None 100
Inc. (renamed
Trump Casinos,
Inc.)
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Taj Mahal, Common 4 None .625
Inc. (renamed
Trump Casinos,
Inc.)
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Taj Mahal, Common 5 None 60.375
Inc. (renamed
Trump Casinos,
Inc.)
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotels & Class B Common 2 $.01 800 80
Casino Resorts, Stock
Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotels & Limited 4 and 4-A N/A 21.20679% 21.20679
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Casino Resorts Partnership interest
Holdings, L.P. Interests (Certificate No.
4 represents
99.89004% of
such interest
and Certificate
No. 4-A
represents
0.10996% of such
interest)
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotels & Warrant for W-001 $.01 600,000
Casino Resorts, Common Stock, (par value of (number of underlying
Inc. exercisable from underlying shares)
April 17, 1996 stock)
through April
17, 1999 at
$35.00 per share
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotels & Warrant for W-002 $.01 600,000
Casino Resorts, Common Stock, (par value of (number of underlying
Inc. exercisable from underlying shares)
April 17, 1996 stock)
through April
17, 2000 at
$40.00 per share
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Hotels & Warrant for W-003 $.01 600,000
Casino Resorts, Common Stock, (par value of (number of underlying
Inc. exercisable from underlying shares)
April 17, 1996 stock)
through April
17, 2001 at
$45.00 per share
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump's Castle General 101 N/A 61.5% GP interest 61.5
Associates Partnership
Interests
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Trump Seashore General 3 N/A 99% GP interest 99
Associates Partnership
Interests
- ------------------------------------------------------------------------------------------------------------------------------------
DJT Ultimate Air Corp. Common 1 None 1,000 100
- ------------------------------------------------------------------------------------------------------------------------------------
Trump Seashore Associates, Trump Seashore General 4 N/A 1% GP interest 1
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
Inc. Associates Partnership
- ------------------------------------------------------------------------------------------------------------------------------------
Trump Casinos, Inc. (f/k/a Trump Hotels & Class B Common 3 $.01 200 20
Trump Taj Mahal, Inc.) Casino Resorts, Stock
Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
Trump Casinos, Inc. (f/k/a Trump Hotels & General 6 N/A 4.47082% interest 4.47082
Trump Taj Mahal, Inc.) Casino Resorts Partnership
Holdings, L.P. Interests
- ------------------------------------------------------------------------------------------------------------------------------------
TC/GP, Inc. Trump's Castle Partnership 102 N/A 37.5% interest 37.5
Associates Interests
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
Exhibit VII: Joint Filing Agreement between Donald J. Trump and Trump Casinos,
Inc., dated April 17, 1996.
<PAGE>
Exhibit VII
- -----------
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 17th day of April 1996.
/s/
---------------------------------
Donald J. Trump
TRUMP CASINOS, INC.
By: /s/
------------------------------
Name: Donald J. Trump
Title: Sole Director,
President and
Treasurer
