SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
TRUMP HOTELS & CASINO RESORTS, INC.
(Name of Registrant as Specified In Its Charter)
TRUMP HOTELS & CASINO RESORTS, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14(a)-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total Fee Paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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TRUMP HOTELS & CASINO RESORTS, INC.
1000 Boardwalk, Atlantic City
New Jersey 08401
Notice of Annual Meeting of Stockholders
to be held on August 3, 2000
June 23, 2000
To the Stockholders:
You are cordially invited to attend the Annual Meeting of Stockholders (the
"Annual Meeting") of Trump Hotels & Casino Resorts, Inc. (the "Company"), which
will be held at Trump Hotel Casino, One Buffington Harbor Drive, Gary, Indiana,
on August 3, 2000 beginning at 11:30 A.M., local time. On the back of this
document you will find specific information pertaining to the meeting including
directions to the site, accommodations, as well as the meeting Admission Ticket.
Please review this information carefully.
The enclosed Notice and Proxy Statement contain details concerning the business
to come before the Annual Meeting. You will note that the Board of Directors of
the Company recommends a vote "for" each of the proposals listed in the Notice
and Proxy Statement. Please sign and return your proxy card in the enclosed
envelope at your earliest convenience to ensure that your shares will be
represented and voted at the meeting, even if you cannot attend.
Thank you for your continued support of the Company.
By Order of the Board of Directors,
/s/ Donald J. Trump
Donald J. Trump
Chairman of the Board and
Acting President and Chief Executive Officer
TRUMP HOTELS & CASINO RESORTS, INC.
1000 Boardwalk
Atlantic City, New Jersey 08401
___________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
August 3, 2000
_____________
To the Stockholders of
TRUMP HOTELS & CASINO RESORTS, INC.:
The Annual Meeting of Stockholders (the "Annual Meeting") of Trump Hotels &
Casino Resorts, Inc., a Delaware corporation (the "Company"), will be held at
the Trump Hotel Casino, One Buffington Harbor Drive, Gary, Indiana on Thursday,
August 3, 2000, commencing at 11:30 A.M., local time, for the following
purposes:
1. To elect four (4) Directors to the Company's Board of Directors (the
"Board of Directors");
2. To ratify the appointment by the Board of Directors of Arthur Andersen
LLP as independent auditors of the Company for the fiscal year ending
December 31, 2000; and
3. To act upon such other business as may properly come before the Annual
Meeting or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on June 6, 2000, as
the record date for the determination of stockholders entitled to receive notice
of and to vote at the Annual Meeting and any adjournment or postponement
thereof.
By Order of the Board of Directors,
/s/ Robert M. Pickus
Robert M. Pickus
Secretary
June 23, 2000
Your vote is important. Whether or not you expect to be present at the
Annual Meeting, please date and sign the enclosed proxy and return it promptly
in the enclosed envelope. You may revoke your proxy at any time before it is
voted at the Annual Meeting. In the event you attend the Annual Meeting and vote
in person, the proxy will not be used.
TRUMP HOTELS & CASINO RESORTS, INC.
1000 Boardwalk
Atlantic City, New Jersey 08401
____________________
PROXY STATEMENT
____________________
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Trump Hotels & Casino Resorts, Inc., a
Delaware corporation ("THCR" or the "Company"), to be voted at the Annual
Meeting of Stockholders (the "Stockholders") of the Company to be held on
Thursday, August 3, 2000, at 11:30 A.M., local time, at the Trump Hotel Casino,
One Buffington Harbor Drive, Gary, Indiana, and at any adjournment or
postponement thereof (the "Annual Meeting"). A copy of the Company's Annual
Report to Stockholders for the fiscal year ended December 31, 1999, this Proxy
Statement and the accompanying proxy card are first being sent or given to
Stockholders on or about June 23, 2000.
Properly executed proxies received prior to the Annual Meeting, unless
revoked, will be voted in accordance with the specified instructions. Regarding
the election of Directors, Stockholders may vote in favor of all nominees or
withhold their votes as to all nominees or withhold their votes as to specific
nominees. With respect to all other proposals to be voted upon, Stockholders may
vote in favor of a proposal, against a proposal or may abstain from voting.
Stockholders should specify their choices on the enclosed proxy card. If no
instructions are given with respect to the matters to be acted upon, the persons
named in the proxy solicited by the Company's Board of Directors (the "Board of
Directors") intend to vote FOR the election of the Directors listed below and
FOR ratification of the appointment by the Board of Directors of Arthur Andersen
LLP as independent auditors of the Company for the fiscal year ending December
31, 2000. If any other matter should be presented at the Annual Meeting upon
which a vote may properly be taken, the shares represented by the proxy will be
voted with respect thereto by the person or persons holding such proxy as in
their judgment is in the best interests of the Company and the Stockholders. The
Company does not know of any matters other than those described in the Notice of
Annual Meeting that are to come before the Annual Meeting.
Stockholders may vote by either completing and returning the enclosed proxy
card prior to the Annual Meeting, voting in person at the Annual Meeting or
submitting a signed proxy card at the Annual Meeting. Stockholders who execute
proxies may revoke them at any time before they are voted at the Annual Meeting
by written notice to the Secretary of the Company, by submitting a new proxy or
by personal ballot at the Annual Meeting.
The Board of Directors has fixed the close of business on June 6, 2000 as
the Record Date (the "Record Date") for determining Stockholders entitled to
notice of and to vote at the Annual Meeting.
As of the Record Date, the Company had 22,079,256 shares of Common Stock,
par value $.01 per share (the "Common Stock"), and 1,000 shares of Class B
Common Stock, par value $.01 per share (the "Class B Common Stock"), outstanding
and entitled to vote at the Annual Meeting. Each share of Common Stock entitles
the holder thereof to one vote on each proposal to be acted upon at the Annual
Meeting and the 1,000 shares of Class B Common Stock, all of which are
beneficially owned by Donald J. Trump, are entitled to an aggregate of
13,918,723 votes on each proposal to be acted upon at the Annual Meeting. The
voting power of the shares of Class B Common Stock equals the voting power of
the number of shares of Common Stock issuable upon the conversion of the limited
partnership interests in Trump Hotels & Casino Resorts Holdings, L.P., a
Delaware limited partnership ("THCR Holdings"), held by Mr. Trump, Trump
Casinos, Inc., a New Jersey corporation wholly owned by Mr. Trump ("TCI"), and
Trump Casinos II, Inc., a Delaware corporation wholly owned by Mr. Trump ("TCI-
II"). The Class B Common Stock provides the holders thereof with a voting
interest in the Company which is proportionate to such holder's equity interest
in THCR Holdings' assets represented by limited partnership interests.
The presence in person or by proxy of the holders of the shares
representing a majority of the outstanding voting power of the Common Stock and
the Class B Common Stock is necessary to constitute a quorum in connection with
the transaction of business at the Annual Meeting. The affirmative vote of a
plurality of shares of Common Stock and Class B Common Stock present in person
or by proxy and entitled to vote at the Annual Meeting, voting
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as a single class, is required for election of Directors and the affirmative
vote of a majority of shares of Common Stock and Class B Common Stock present in
person or by proxy and entitled to vote at the Annual Meeting, voting as a
single class, is required for ratification of the appointment of Arthur Andersen
LLP as auditors for the Company. Broker "non-votes" (i.e., proxies from brokers
or nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares as to a matter with
respect to which the brokers or nominees do not have discretionary power to
vote) and shares for which duly executed proxies have been received but with
respect to which holders of shares have abstained from voting will be treated as
present for purposes of determining the presence of a quorum at the Annual
Meeting. Broker "non-votes" will have no effect on the outcome of the votes on
the proposals to be acted upon at the Annual Meeting. With respect to the
ratification of the appointment of Arthur Andersen LLP as independent auditors
for the Company, abstentions will have the effect of a negative vote.
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PROPOSAL ONE
ELECTION OF DIRECTORS
Four Directors are to be elected to hold office until the next annual
meeting of Stockholders of the Company and until their successors have been duly
elected and qualified. If the proxy is executed in such a manner as not to
withhold authority for the election of any or all of the nominees for Directors,
then the persons named in the proxy will vote the shares represented by the
proxy for the election of the following four nominees. If the proxy indicates
that the stockholder wishes to withhold a vote from one or more nominees for
Directors, such instructions will be followed by the persons named in the proxy.
All of the nominees are currently members of the four member Board of Directors.
Mr. Trump has been a member of the Board of Directors since the Company's
inception in March 1995, and Messrs. Askins, Thomas and Ryan have been members
of the Board of Directors since June 12, 1995. This year, the Board of Directors
will consist of four members.
Should any one or more of these nominees become unable to serve for any
reason or will not serve, neither of which is anticipated, the Board of
Directors may, unless the Board of Directors by resolution provides for a lesser
number of Directors, designate substitute nominees, in which event the persons
named in the enclosed proxy card will vote for the election of such substitute
nominee or nominees.
The respective ages, positions with the Company, business experience during
the past five years and directorships in other companies of the nominees for
election as Directors of the Company are set forth below.
Donald J. Trump, 54 years old, has been Chairman of the Board of Directors
of the Company and Trump Hotels & Casino Resorts Funding, Inc., a Delaware
corporation ("THCR Funding"), since their formation in March 1995, and has
assumed the role of Acting President and Chief Executive Officer in June 2000.
Mr. Trump was a 50% shareholder, Chairman of the Board of Directors, President
and Treasurer of TP/GP Corp., a New Jersey corporation ("TP/GP"), the managing
general partner of Trump Plaza Associates, a New Jersey general partnership
("Plaza Associates"), until June 1993. Mr. Trump was Chairman of the Executive
Committee and President of Plaza Associates from May 1986 to May 1992 and was a
general partner of Plaza Associates until June 1993. Mr. Trump has been a
director of Trump Atlantic City Holding Inc., a Delaware corporation formerly
known as Trump Plaza Holding, Inc. ("Trump AC Holding"), since February 1993 and
was President of Trump AC Holding from February 1993 until December 1997. Mr.
Trump was a partner in Trump AC from February 1993 until June 1995. Mr. Trump
has been Chairman of the Board of Directors of Trump Atlantic City Funding,
Inc., a Delaware corporation ("Trump AC Funding") since its formation in January
1996 and Chairman of the Board of Directors of Trump Atlantic City Funding II,
Inc. ("Funding II") and Trump Atlantic City Funding III, Inc. ("Funding III")
since their formation in November 1997. Trump has been Chairman of the Board of
Directors of THCR Holding Corp., a Delaware corporation formerly known as Taj
Mahal Holding Corp., and THCR/LP Corporation, a New Jersey corporation formerly
known as TM/GP Corporation ("THCR/LP"), since October 1991; President and
Treasurer of THCR Holding Corp. since March 4, 1991; Chairman of the Board of
Directors, President, and Treasurer of TCI since June 1988; Chairman of the
Executive Committee of Trump Taj Mahal Associates ("Taj Associates") from June
1988 to October 1991; and President and sole Director of Trump Taj Mahal Realty
Corp., a New Jersey corporation ("Realty Corp."), since May 1986. Mr. Trump has
been the sole Director of Trump Atlantic City Corporation ("TACC") since March
1991. Mr. Trump was President and Treasurer of TACC from March 1991 until
December 1997. Trump has been the sole Director of Trump Indiana, Inc., a
Delaware corporation ("Trump Indiana"), since its formation. Mr. Trump has been
Chairman of the Board of Partner Representatives of Trump's Castle Associates,
L.P., a New Jersey limited partnership ("Castle Associates"), the partnership
that owns Trump Marina Hotel Casino ("Trump Marina"), since May 1992; and was
Chairman of the Executive Committee of Castle Associates from June 1985 to May
1992. Mr. Trump is the Chairman of the Board of Directors of Trump's Castle
Funding, Inc., a New Jersey corporation ("Castle Funding"), and served as
President and Treasurer of Castle Funding until April 1998. Trump is the
Chairman of the Board of Directors and Treasurer of Trump's Castle Hotel &
Casino, Inc. ("TCHI"); and President, Treasurer, sole Director and sole
shareholder of TCI-II. Mr. Trump has been a Director of THCR Enterprises, Inc.,
a Delaware corporation ("THCR Enterprises"), since its formation in January
1997. Mr. Trump is also the President of The Trump Organization, which has been
in the business, through its affiliates and subsidiaries, of acquiring,
developing and managing real estate properties for more than the past five years
.
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Wallace B. Askins, 70 years old, has been a Director of the Company and
THCR Funding since June 1995. He has also been a Director of Trump AC Holding
since April 11, 1994, and was a partner representative of the Board of Partner
Representatives of Castle Associates from May 1992 to June 1995. Mr. Askins has
been a Director of Trump AC Funding since April 1996 and a Director of Funding
II and Funding III since December 1997. Mr. Askins served as a Director of TCI-
II from May 1992 to December 1993. From June 1984 to November 1992, Mr. Askins
served as Executive Vice President, Chief Financial Officer and a Director of
Armco Inc. Mr. Askins also serves as a Director of EnviroSource, Inc.
Don M. Thomas, 69 years old, has been a Director of the Company and THCR
Funding since June 1995. He has also been a Director of Trump AC Funding since
April 1996 and a Director of Funding II and Funding III since December 1997. Mr.
Thomas has been the Senior Vice President of Corporate Affairs of the Pepsi-Cola
Bottling Co. of New York since January 1985. Mr. Thomas was the Acting Chairman,
and a Commissioner, of the CRDA from 1985 through 1987, and a Commissioner of
the New Jersey Casino Control Commission (the "CCC") from 1980 through 1984
during a portion of which time Mr. Thomas served as acting Chairman of the CCC.
Mr. Thomas was a Director of Trump Plaza GP until June 1993 and has been a
Director of AC Holding Inc. since June 1993. Mr. Thomas is an attorney licensed
to practice law in the State of New York.
Peter M. Ryan, 62 years old, has been a Director of the Company and THCR
Funding since June 1995. He has also been the President of each of The Marlin
Group, LLC and The Brookwood Carrington Fund, LLC, real estate financial
advisory groups, since January 1995. Prior to that, Mr. Ryan was the Senior Vice
President of The Chase Manhattan Bank for more than five years. Mr. Ryan has
been a director of the Children's Hospital FTD since October 1995.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF
THE NOMINEES NAMED ABOVE.
The following persons serve as executive officers of the Company: Mr.
Trump, Chairman of the Board and Acting President and Chief Executive Officer;
Mr. Mark A. Brown, Chief Operating Officer; Mr. Robert M. Pickus, Executive Vice
President, General Counsel and Secretary; Mr. John P. Burke, Executive Vice
President and Corporate Treasurer; Mr. Francis X. McCarthy, Jr., Executive Vice
President of Corporate Finance and Chief Financial Officer; and Mr. Joseph A.
Fusco, Executive Vice President of Government and Regulatory Affairs. The
officers of the Company serve at the pleasure of the Board of Directors. The
respective ages, positions with the Company, business experience during the past
five years and directorships in other companies of Messrs. Brown, Pickus, Burke,
McCarthy and Fusco are set forth below.
Mark A. Brown--Mr. Brown, 39 years old, was appointed Chief Operating
Officer of the Company effective June 13, 2000, at which time he was also
appointed President and Chief Executive Officer of each of Plaza Associates,
Castle Associates, Trump Casino Services, L.L.C. ("TCS") and Taj Associates,
where he had been President and Chief Operating Officer since January 2000. Mr.
Brown was President and Chief Operating Officer of Castle Associates from
November 1997 until his transfer to Taj Associates and Executive Vice President
of Operations of Castle Associates from July 1995 until November 1997 and was
Vice President of TCHI until his transfer to Taj Associates. Previously, Mr.
Brown served as Senior Vice President of Eastern Operations for Caesar's World
Marketing Corporation, National and International Divisions from 1993 until
1995. Prior to that, Mr. Brown served as Vice President of Casino Operations at
the Taj Mahal from 1989 until 1993. From 1979 until 1989, Mr. Brown worked for
Resorts International Hotel Casino departing as Casino Shift Manager.
Robert M. Pickus--Mr. Pickus, 45 years old, has been Executive Vice
President, General Counsel and Secretary of the Company since its formation in
1995. He has also been the Executive Vice President of Corporate and Legal
Affairs of Plaza Associates since February 1995. From December 1993 to February
1995, Mr. Pickus was the Senior Vice President and General Counsel of Plaza
Associates. Mr. Pickus served as the Assistant Secretary of Trump AC Holding
from April 1994 until February 1998. Since February 1998, Mr. Pickus has served
as the Secretary of Trump AC Holding. Mr. Pickus has been Secretary and a
director of Trump AC Funding since its formation in January 1996 and Secretary
and a director of Funding II and Funding III since their formation in November
1997. Mr. Pickus has been the Executive Vice President and Secretary of Trump
Indiana since its inception. Mr. Pickus has been the Executive Vice President of
Corporate and Legal Affairs of Taj Associates since February 1995, and a
Director of THCR Holding Corp. and THCR/LP since November 1995. He was the
Senior
-4-
Vice President and Secretary of Castle Funding from June 1988 to December 1993
and General Counsel of Castle Associates from June 1985 to December 1993. Mr.
Pickus has served as the Secretary of Castle Funding since April 1998. Mr.
Pickus served as the Assistant Secretary of TACC until February 1998. Since
February 1998, Mr. Pickus has served as the Secretary of TACC. Mr. Pickus was
also Secretary of TCHI from October 1991 until December 1993. Mr. Pickus is a
director of TCHI, and has served as the Assistant Secretary of TCHI from
February 1998 until April 1998. Since April 1998, Mr. Pickus has served as the
Secretary of TCHI. Mr. Pickus has been the Executive Vice President of Corporate
and Legal Affairs of Castle Associates since February 1995, Secretary of Castle
Associates since February 1996 and a member of the Board of Partner
Representatives of Castle Associates since October 1995. Mr. Pickus is currently
the Secretary of THCR Holding Corp., has been the Vice President, Secretary and
Director of THCR Enterprises since January 1997 and has been Executive Vice
President of TCS since its inception and its President from November 1998
through June 2000. He has been admitted to practice law in the States of New
York and New Jersey since 1980, and in the Commonwealth of Pennsylvania since
1981.
Francis X. McCarthy, Jr.--Mr. McCarthy, 48 years old, has served as
Executive Vice President of Corporate Finance and Chief Financial Officer of the
Company, THCR Holdings and THCR Funding since September 1998. Mr. McCarthy has
been the Chief Financial Officer of Trump AC, Trump AC Funding, Funding II and
Funding III since September 1998. Mr. McCarthy has been the Executive Vice
President of Finance of TCS since October 1996. Mr. McCarthy was Vice President
of Finance and Accounting of Trump Plaza GP from October 1992 until June 1993,
Senior Vice President of Finance and Administration of Plaza Associates from
August 1990 to June 1994 and Executive Vice President of Finance and
Administration of Plaza Associates from June 1994 to October 1996. Mr. McCarthy
previously served in a variety of financial positions for Greate Bay Hotel and
Casino, Inc. from June 1980 through August 1990.
John P. Burke--Mr. Burke, 52 years old, has served as Executive Vice
President and Corporate Treasurer of the Company since January 1999 and served
as the Senior Vice President of Corporate Finance of the Company from January
1996 until June 1997. Mr. Burke served as the Senior Vice President of the
Company, THCR Holdings and THCR Funding from June 1997 to January 1999. Mr.
Burke has served as Executive Vice President of THCR Holdings and THCR Funding
since January 1999. Mr. Burke has been the Corporate Treasurer of the Company,
THCR Holdings and THCR Funding since their formation in 1995. He has also been
Corporate Treasurer of Plaza Associates and Taj Associates since October 1991.
Mr. Burke has been the Treasurer of Trump Indiana since its formation. Mr. Burke
has been Treasurer of Trump AC Funding since its formation in January 1996 and
Treasurer of Funding II and Funding III since their formation in November 1997.
Mr. Burke has been Treasurer of TACC since February 1998. Mr. Burke was a
Director of THCR/LP and THCR Holding Corp. from October 1991 to April 1996 and
was Vice President of THCR/LP until June 1995. Mr. Burke has served as the
Assistant Treasurer of THCR Holding Corp. and THCR/LP since February 1998. Mr.
Burke has been the Corporate Treasurer of Castle Associates since October 1991,
the Vice President of Castle Associates, Castle Funding, TCI-II and TCHI since
December 1993, Assistant Treasurer of TCHI since April 1998, Treasurer of Castle
Funding since April 1998, a member of the Board of Partner Representatives of
Castle Associates since March 1997 and the Vice President-Finance of The Trump
Organization since September 1990. Mr. Burke was an Executive Vice President and
Chief Administrative Officer of Imperial Corporation of America from April 1989
through September 1990. Mr. Burke has been the Vice President and Treasurer of
THCR Enterprises since January 1997.
Joseph A. Fusco--Mr. Fusco, 56 years old, has been Executive Vice President
for Government Relations & Regulatory Affairs of the Company since June 1996 and
of TCS since July 1996. From August 1985 to June 1996, he practiced law as a
partner in various Atlantic City law firms specializing in New Jersey casino
regulatory, commercial and administrative law matters, most recently from
January 1994 to June 1996 as a partner in the law firm of Sterns & Weinroth. Mr.
Fusco previously served as Atlantic County Prosecutor, a Gubernatorial
appointment, from April 1981 to July 1985 and as Special Counsel for Licensing
for the CCC from the inception of that agency in September 1977 to March 1981.
Mr. Fusco has been admitted to practice law in the State of New Jersey since
1969.
-5-
Security Ownership
The following table sets forth, as of June 16, 2000, certain information
regarding the beneficial ownership of the Common Stock by (i) each of the
Company's executive officers, (ii) each director of the Company, (iii) each
person who is known to the Company to own beneficially more than 5% of the
Common Stock and (iv) all officers and directors of the Company as a group. In
the case of persons other than officers and directors of the Company, such
information is based solely on a review of Schedules 13G filed with the
Commission.
Beneficial Ownership
Name Number Percent
- ---- ------ -------
Donald J. Trump............................................................. 15,334,306(1) 41.2%
Mark A. Brown............................................................... 8,333(2) *
John P. Burke............................................................... 22,442(3) *
Francis X. McCarthy, Jr..................................................... 10,121(4) *
Robert M. Pickus............................................................ 22,000(5) *
Joseph A. Fusco............................................................. 13,333(6) *
Wallace B. Askins........................................................... 4,667(7) *
Don M. Thomas............................................................... 4,167(7) *
Peter M. Ryan............................................................... 11,667(7) *
Conseco, Inc................................................................ 2,010,000(8) 8.9%
Dimensional Fund Advisors Inc............................................... 1,698,500(9) 7.5%
Mario J. Gabelli............................................................ 1,407,500(10) 6.2%
Bay Harbour Management, L.C................................................. 1,392,600(11) 6.1%
All officers and directors of the Company (9 persons)....................... 15,431,036 41.5%
The above persons have sole voting and investment power, unless
otherwise indicated below.
- ----------------------
* Less than 1%.
(1) 725 Fifth Avenue, New York, New York 10022. These shares include
10,300,456, 1,407,017, and 2,211,250 shares of Common Stock into which Mr.
Trump's, TCI's and TCI-II's limited partnership interests in THCR Holdings
are convertible, subject to certain adjustments. TCI and TCI-II are
corporations wholly owned by Mr. Trump. These shares also include (a)
482,250 shares of THCR Common Stock, of which 150 are held as custodian for
his children, and (b) 600,000 shares of Common Stock underlying currently
exercisable warrants to purchase Common Stock held by Mr. Trump which may
be purchased on or before April 17, 2001 at $40.00 per share. Mr. Trump
beneficially owns an approximately 37% limited partnership interest in THCR
Holdings, of which approximately 4% is held directly by TCI and 6% by TCI-
II. Mr. Trump is also the beneficial owner of all of the outstanding shares
of Class B Common Stock (1,000 shares) of which he holds 850 shares
directly and holds 50 shares through TCI and 100 shares through TCI-II. The
figure stated above includes options exercisable for 333,333 shares of
Common Stock at $4.625 per share.
(2) Includes options exercisable for 5,333 shares of Common Stock at $4.625 per
share.
(3) Mr. Burke shares voting and dispositive power of 200 of these shares with
his wife. These shares also include 200 shares beneficially owned solely by
his wife, of which shares Mr. Burke disclaims beneficial ownership. Mr.
Burke also owns options for 20,000 shares which are exercisable at $4.625
per share and 1,742 shares of Common Stock in his 401K Plan.
(4) Includes options exercisable for 6,667 shares of Common Stock at $4.625 per
share and 3,454 shares in his 401K Plan.
(5) Includes options exercisable for 20,000 shares of Common Stock at $4.625
per share.
(6) Includes options exercisable for 13,333 shares of Common Stock at $4.625
per share.
(7) Includes options exercisable for 1,667 shares of Common Stock at $4.625 per
share.
(8) 11825 North Pennsylvania Street, Carmel, Indiana 46032. These shares are
beneficially owned by Bankers Life and Casualty Company, an insurance
company, of which Conseco, Inc. is the parent holding company.
(9) 1299 Ocean Avenue, 11th Floor, Santa Monica, CA 90401. Dimensional Fund
Advisors Inc. ("Dimensional"), a registered investment advisor, is deemed
to have beneficial ownership of 1,698,500 shares of Common Stock as of May
16, 2000, all of which shares are held in portfolios of DFA Investment
Dimensions Group Inc., a registered open-end investment company, or in
series of the DFA Investment Trust Company, a Delaware business trust, or
the DFA Group Trust and DFA Participation Group Trust, investment vehicles
for qualified employee benefit plans, all of which Dimensional Fund
Advisors Inc. serves as investment manager. Dimensional disclaims
beneficial ownership of all such shares.
(10) One Corporate Center, Rye, New York 10580-1434. Mario J. Gabelli claims
beneficial ownership of these shares through various entities which he
directly or indirectly controls or for which he acts as chief investment
officer.
-6-
(11) 777 South Harbour Island Boulevard, Suite 270, Tampa, Florida 33602. Bay
Harbour Management, L.C. ("Bay Harbour") is an investment advisor and
claims beneficial ownership of these shares which it holds for the account
of investment funds and managed accounts.
THCR Holdings. THCR Holdings is a limited partnership of which the Company
is a 59.87743% general partner, Mr. Trump is a 27.06458% limited partner,
THCR/LP is a 3.55096% limited partner, TCI is a 3.69695% limited partner and TCI
II is a 5.81009% limited partner.
THCR Funding. THCR Holdings owns 100% of the common stock of THCR Funding.
-7-
EXECUTIVE COMPENSATION
The following table sets forth information regarding compensation paid to
or accrued by all the executive officers of the Company, for each of the last
three completed fiscal years. Compensation accrued during one year and paid in
another is recorded under the year of accrual.
Annual Compensation Long Term Compensation Awards
------------------- -----------------------------
Restricted Securities
Name and Principal Stock Underlying All Other
Position Year Salary Bonus Awards($) Options(#) Compensation
-------- ---- ------ ----- --------- ---------- --------------
Donald J. Trump............ 1999 $1,000,000 -- -- -- $2,648,000(1)
Chairman of the Board 1998 1,000,000 -- -- 500,000 222,474(1)
1997 1,000,000 -- -- -- 212,960(1)
Nicholas L. Ribis(5)....... 1999 $1,996,500 $480,000(2) -- -- $ 4,800(4)
Chief Executive Officer 1998 1,996,500 -- -- 183,333 4,800(4)
1997 1,996,500 -- $758,326(3) -- 4,000(4)
Mark A. Brown.............. 1999 $ 487,762 $109,410(6) -- -- $ 4,286(4)
Chief Operating Officer 1998 436,323 75,000 -- 8,000 4,286(4)
1997 352,383 75,000 -- -- 2,375(4)
Robert M. Pickus........... 1999 $ 324,653 $50,000 -- -- $ 4,800(4)
Executive Vice President, 1998 299,428 -- -- 30,000 4,298(4)
General Counsel and 1997 299,160 25,000 -- -- 4,000(4)
Secretary
Joseph A. Fusco............ 1999 $ 324,510 $36,470 -- -- $ 4,800(4)
Executive Vice President 1998 296,343 -- -- 20,000 4,800(4)
of Government and 1997 295,660 25,000 -- -- 4,000(4)
Regulatory Affairs
Francis X. McCarthy, Jr.... 1999 $ 320,073 -- -- -- $ 4,800(4)
Executive Vice President 1998 303,593 -- -- 10,000 4,621(4)
of Corporate Finance and 1997 307,382 -- -- -- 3,958(4)
Chief Financial Officer
- ----------------------
(1) The amount listed in 1999 includes $2,258,000 recorded pursuant to the
Castle Services Agreement (as defined) in addition to reimbursement of
expenses pursuant to the Executive Agreement between Mr. Trump, the Company
and THCR Holdings.
(2) During January 1999 Mr. Ribis received a net bonus of $250,000 which
resulted in a before tax bonus of $480,000.
(3) On June 12, 1997, 66,666 shares of Common Stock were issued in accordance
with Mr. Ribis' employment agreement.
(4) Represents vested and unvested contributions made by Plaza Associates, Taj
Associates, Castle Associates and/or TCS to Trump Plaza Hotel and Casino
Retirement Savings Plan, Trump Taj Mahal Retirement Savings Plan, Trump's
Castle Hotel and Casino Retirement Savings Plan and Trump Casino Services
Retirement Savings Plan, respectively. Funds accumulated for an employee
under these plans consisting of a certain percentage of the employee's
compensation plus the employer matching contributions equaling 50% of the
-8-
participant's contributions, are retained until termination of employment,
attainment of age 59 1/2 or financial hardship, at which time the employee
may withdraw his or her vested funds.
(5) Mr. Ribis' employment terminated as of June 12, 2000 upon the expiration of
his employment agreement.
(6) In January 1999, Mr. Brown received a net bonus of $75,000 which resulted in
a before tax bonus of $109,410.
The following table sets forth the number of shares covered by options held
by the Executive Group, Messrs. Trump, Ribis, Brown, Pickus, McCarthy and Fusco,
and the value of the options as of December 31, 1999. No member of the Executive
Group exercised any options during the last fiscal year.
FY-End Option Value(1)
Number of Securities Underlying Value of Unexercised In-the-Money
Unexercised Options at FY-End(#) Options at FY-End($)(1)
-------------------------------- -------------------------
Name Unexercisable/Exercisable Unexercisable/Exercisable
- ---- ------------------------- -------------------------
Donald J. Trump................................... 166,667 333,333 (See Footnote below)
Nicholas L. Ribis(2).............................. 61,111 122,222
Mark A. Brown..................................... 2,667 5,333
Robert M. Pickus.................................. 10,000 20,000
Francis X. McCarthy, Jr........................... 3,333 6,667
Joseph A. Fusco................................... 6,667 13,333
- ----------------------
(1) Based on a closing sale price of $3.75 per share of Common Stock on
December 31, 1999, all of the options were out of the money at fiscal year
end.
(2) Mr. Ribis' employment terminated as of June 12, 2000 upon the expiration of
his employment agreement. All options granted to Mr. Ribis expire on
September 10, 2000.
Employment Agreements
Donald J. Trump. Mr. Trump serves as the Chairman of the Board of Directors
pursuant to the Executive Agreement dated as of June 12, 1995, among Mr. Trump
and THCR Holdings (the "Executive Agreement"). In consideration for Mr. Trump's
services under the Executive Agreement, Trump receives a salary of $1 million
per year. Pursuant to the terms of the Executive Agreement, Mr. Trump provides
to the Company, from time to time, when reasonably requested, marketing,
advertising, professional and other similar and related services with respect to
the operation and business of the Company. The Executive Agreement continues in
effect for a three-year rolling term until either Mr. Trump or the Company
provides notice to the other of its election not to continue extending the term,
in which case the term of the Trump Executive Agreement will end three years
from the date such notice is given.
Mark A. Brown. On January 4, 2000, Mark A. Brown's Employment Agreement
with Castle Associates, dated as of March 6, 1998, was amended and assigned to
Taj Associates (the "Brown Agreement"). The Brown Agreement, the term of which
expires on January 2, 2003, if not extended, provides for annual compensation of
$600,000, $650,000, and $700,000 during 2000, 2001, and 2002, respectively.
Employment may be terminated for "cause" which was defined as (i) revocation of
his casino key employee license, (ii) conviction of certain crimes, (iii)
disability, death or (iv) breach of his duty to Taj Associates. Upon termination
for cause, Mr. Brown will receive only compensation earned to the date of
termination. Mr. Brown may terminate the Brown Agreement at any time following a
change of control and will receive a lump sum payment of the full amount of the
unpaid compensation through January 2, 2003. The Brown Agreement defines "change
of control" as (i) the acquisition of the Trump companies or over thirty-five
percent (35%) of the Company's common stock or equivalent limited partnership
interest by an unrelated party or (ii) the sale or long-term lease of all or
substantially all of the assets of the Trump companies. Pursuant to the Brown
Agreement, Mr. Brown has agreed not to obtain employment for or on behalf of any
other casino hotel located in Atlantic City during the term of the Brown
Agreement .
-9-
Robert M. Pickus. On April 17, 2000, the Company, THCR Holdings, and Trump
Atlantic City Associates (collectively, the "Trump Companies") entered into an
employment agreement with Robert M. Pickus (the "Pickus Agreement") pursuant to
which he serves as Executive Vice President and General Counsel of the Company.
The Pickus Agreement, the term of which expires on April 16, 2003, if not
extended, provides for annual compensation of $336,000. Employment may be
terminated for "cause", which is defined in the Pickus Agreement as (i)
revocation of his casino key employee license, (ii) conviction of certain
crimes, (iii) disability or death or (iv) breach of his duty to the Trump
Companies. Upon termination for cause, Mr. Pickus will receive only compensation
earned to the date of termination. Mr. Pickus may terminate his agreement at any
time following a Change of Control and receive a lump sum payment of the full
amount of the unpaid compensation through April 16, 2003. The Pickus Agreement
defines "Change of Control" as (i) the acquisition of the Trump Companies or
over thirty-five (35%) percent of the Company's common stock or equivalent
limited partnership interest by an unrelated party or (ii) the sale or long-term
lease of all or substantially all of the assets of the Trump Companies. Pursuant
to the Pickus Agreement, Mr. Pickus has agreed not to accept employment for or
on behalf of any other casino hotel located in Atlantic City during the term of
the Pickus Agreement.
Joseph A. Fusco. On April 17, 2000, Trump entered into an employment
agreement with Joseph A. Fusco (the "Fusco Agreement") pursuant to which he
serves as Executive Vice President of Government Relations and Regulatory
Affairs. The Fusco Agreement, the term of which expires on April 16, 2003, if
not extended, provides for annual compensation of $325,500. Employment may be
terminated for "cause" which is defined as (i) revocation of his casino key
employee license, (ii) conviction of certain crimes, (iii) disability or death
or (iv) breach of his duty to the Trump Companies. Upon termination for cause,
Mr. Fusco will receive only compensation earned to the date of termination. Mr.
Fusco may terminate his agreement at any time following a Change of Control and
receive a lump sum payment of the full amount of the unpaid compensation through
April 16, 2003. The Fusco Agreement defines "Change of Control" as (i) the
acquisition of the Trump Companies or over thirty-five (35%) percent of the
Company's common stock or equivalent limited partnership interest by an
unrelated party or (ii) the sale or long-term lease of all or substantially all
of the assets of the Trump Companies. Pursuant to the Fusco Agreement, Mr. Fusco
has agreed not to accept employment for or on behalf of any other casino hotel
located in Atlantic City during the term of the Fusco Agreement.
John P. Burke. On April 17, 2000, Trump entered into an employment
agreement with John P. Burke (the "Burke Agreement") pursuant to which he serves
as Executive Vice President and Corporate Treasurer. The Burke Agreement, the
term of which expires on December 31, 2001, if not extended, provides for annual
compensation of $210,000. Employment may be terminated for "cause" which is
defined as (i) revocation of his casino key employee license, (ii) conviction of
certain crimes, (iii) disability or death or (iv) breach of his duty to the
Trump Companies. Upon termination for cause, Mr. Burke will receive only
compensation earned to the date of termination. Mr. Burke may terminate his
agreement at any time following a Change of Control and receive a lump sum
payment of the full amount of the unpaid compensation through December 31, 2001.
The Burke Agreement defines "Change of Control" as (i) the acquisition of the
Trump Companies or over thirty-five (35%) percent of the Company's common stock
or equivalent limited partnership interest by an unrelated party or (ii) the
sale or long-term lease of all or substantially all of the assets of the Trump
Companies. Pursuant to the Burke Agreement, Mr. Burke has agreed not to accept
employment for or on behalf of any other casino hotel located in Atlantic City
during the term of the Burke Agreement.
Francis X. McCarthy. On April 17, 2000, Trump entered into an employment
agreement with Francis X. McCarthy (the "McCarthy Agreement") pursuant to which
he serves as Executive Vice President of Corporate Finance. The McCarthy
Agreement, the term of which expires on April 16, 2003, if not extended,
provides for annual compensation of $330,750. Employment may be terminated for
"cause" which is defined as (i) revocation of his casino key employee license,
(ii) conviction of certain crimes, (iii) disability or death or (iv) breach of
his duty to the Trump Companies. Upon termination for cause, Mr. McCarthy will
receive only compensation earned to the date of termination. Mr. McCarthy may
terminate his agreement at any time following a change of control and receive a
lump sum payment of the full amount of the unpaid compensation through April 16,
2003. The McCarthy Agreement defines "Change of Control" as (i) the acquisition
of the Trump Companies or over thirty-five (35%) percent of the Company's common
stock or equivalent limited partnership interest by an unrelated party or (ii)
the sale or long-term lease of all or substantially all of the assets of the
Trump Companies. Pursuant to the McCarthy Agreement, Mr. McCarthy has agreed not
to accept employment for or on behalf of any other casino hotel located in
Atlantic City during the term of the McCarthy Agreement .
-10-
Board of Directors and Committees of the Board of Directors
Mr. Trump, an officer of the Company, received no remuneration for serving
on the Board of Directors. Each of the other Directors received an annual fee of
$50,000 and a meeting fee of $2,000 for each of the Board of Directors or
Committee meetings attended.
The Board of Directors met nine (9) times during 1999. During 1999, each of
the Directors during such period attended at least eighty-eight percent (88%) of
all meetings of the Board of Directors and of each committee of which such
Director was a member.
The Company has, as standing committees, an Executive Committee, an Audit
Committee, a Special Committee, a Stock Incentive Plan Committee and a
Compensation Committee. The Company does not have a Nominating Committee.
The current member of the Executive Committee is Mr. Trump. The Executive
Committee, during intervals between meetings of the Board of Directors, has and
exercises all of the powers of the Board of Directors in the management of the
business and affairs of the Company, subject to any restrictions or limitations
as the Board of Directors may from time to time specify or as limited by the
Delaware General Corporation Law. The Executive Committee met at various times
during 1999.
The current members of the Audit Committee are Messrs. Askins, Ryan and
Thomas, each of whom is an independent director of the Company. The Audit
Committee provides assistance to the Board of Directors with respect to
corporate accounting, reporting practices of the Company and the quality and
integrity of the financial reports of the Company. The Audit Committee
recommends to the Board of Directors the engagement of the independent auditors
of the Company and oversees audits and investigations of the business and
financial affairs of the Company, including, without limitation, any audits or
investigations which may be required by any governmental regulatory authority.
The Audit Committee met four (4) times during 1999.
The current members of the Special Committee are Messrs. Askins, Ryan and
Thomas. The Special Committee is composed entirely of independent Directors and
reviews matters relating to transactions with affiliates of the Company, and
other matters as required pursuant to the Third Amended and Restated Agreement
of Limited Partnership of THCR Holdings, as amended, the indenture under which
the 15 1/2% Senior Secured Notes due 2005 of THCR Holdings and THCR Funding were
issued (the "Senior Note Indenture"), the indenture under which the 11 1/4%
First Mortgage Notes due 2006 of Trump AC and Trump AC Funding were issued (the
"Trump AC Mortgage Note Indenture"), the indenture under which the 11 1/4% First
Mortgage Notes due 2006 of Trump AC and Funding II were issued (the "Funding II
Mortgage Note Indenture") and the indenture under which the 11 1/4% First
Mortgage Notes due 2006 of Trump AC and Funding III were issued (the "Funding
III Mortgage Note Indenture"). The Special Committee met two (2) times during
1999.
The current members of the Stock Incentive Plan Committee are Messrs.
Trump, Askins, Ryan and Thomas. The Stock Incentive Plan Committee is the
committee responsible for administering the 1995 Plan and has the authority to
grant awards to individuals pursuant to the 1995 Plan, to determine the number
of awards to be so granted, the term of such awards, any vesting requirements
and any other administrative determinations required in connection therewith.
The Stock Incentive Plan Committee did not meet during 1999.
The current members of the Compensation Committee are Messrs. Trump, Askins
and Thomas. The Compensation Committee provides assistance to the Board of
Directors to ensure that the Company's officers, key executives and Directors
are compensated in accordance with the Company's total compensation objectives
and executive compensation policies, strategies and pay levels necessary to
support organizational objectives. The Compensation Committee did not meet
during 1999.
Compensation Committee and Stock Incentive Plan Committee Report on Executive
Compensation
The Stock Incentive Plan Committee was formed on June 12, 1995 and the
Compensation Committee was formed in August 1995. Set forth below is a
description of the policies and practices that the Compensation Committee
implements with respect to compensation determinations .
-11-
Compensation Philosophy. The Company's compensation program is designed to
attract, reward and retain highly qualified executives and to encourage the
achievement of business objectives and superior corporate performance. The
program ensures the Board of Directors and Stockholders that (1) the achievement
of the overall goals and objectives of the Company can be supported by adopting
an appropriate executive compensation policy and implementing it through an
effective total compensation program and (2) the total compensation program and
practices of the Company are designed with full consideration of all accounting,
tax, securities law and other regulatory requirements and are of the highest
quality.
The Company's executive compensation program consists of two key elements:
(1) an annual compensation component composed of base salary and bonus, and (2)
a long-term compensation component composed of equity-based awards pursuant to
the 1995 Plan.
Annual Compensation. The Compensation Committee will generally target
annual salary and bonus levels to be competitive with other similarly sized
entities in the casino entertainment industry. Base salaries will be determined
by evaluating the responsibilities associated with the position being evaluated
and t he individual's overall level of experience. Annual salary adjustments
will be determined by giving consideration to the Company's performance and the
individual's contribution to that performance.
Bonuses are based on the Compensation Committee's assessment of the
Company's performance and an individual's contribution to that performance.
Corporate performance is measured by various quantitative and qualitative
factors. The primary quantitative factors that will be reviewed by the
Compensation Committee include such performance measures as net income and
return on average common stockholders' equity, both as absolute measures and
relative to previous years. Significant qualitative factors that will be
evaluated by the Compensation Committee include the Company's performance in
relation to industry performance, progress toward achievement of the Company's
long-term business goals, the quality of the Company's earnings and the overall
business and economic environment. The Compensation Committee believes that, in
accordance with its exercise of sound business judgment, the determination of
annual salary and bonus levels is inherently subjective and must include a
review of all relevant information, with no predetermined weight given to any of
the factors considered.
All of the Company's executive officers are currently under employment
contracts. The annual salary for these individuals is set by the terms of their
employment contracts and any increases in annual salary are determined in the
discretion of the Compensation Committee.
Chairman of the Board Compensation. Mr. Trump is compensated pursuant to
the terms of the Executive Agreement. Mr. Trump did not receive a salary
increase or bonus in 1999.
Long-Term Compensation. In order to align stockholder and executive officer
interests, the long-term component of the Company's executive compensation
program utilizes equity-based awards whose value is directly related to the
value of the Common Stock. These equity-based awards will be granted by the
Stock Incentive Plan Committee pursuant to the 1995 Plan. Individuals to whom
equity-based awards are to be granted and the amount of Common Stock related to
equity-based awards will be determined solely at the discretion of the Stock
Incentive Plan Committee. Because individual equity-based award levels will be
based on a subjective evaluation of each individual's overall past and expected
future contribution, no specific formula is used to determine such awards for
any executive.
Tax Deductibility of Executive Compensation. Section 162(m) of the Internal
Revenue Code limits the tax deductibility of compensation in excess of $1
million paid to certain members of senior management, unless the payments are
made under a performance-based plan as defined in Section 162(m). The Stock
Incentive Plan is designed to allow for the grant of equity-based awards that
are performance-based and therefore exempt from the application of Section
162(m). While the Compensation Committee considers the deductibility of senior
management compensation in making its decisions, it also believes it is
important to maintain the flexibility to take actions it considers to be in the
best interests of the Company and the Stockholders, which may be based on
considerations in addition to Section 162(m).
-12-
COMPENSATION COMMITTEE STOCK INCENTIVE PLAN COMMITTEE
Donald J. Trump Donald J. Trump
Wallace B. Askins Wallace B. Askins
Don M. Thomas Peter M. Ryan
Don M. Thomas
-13-
Comparative Stock Price Performance Graph
The graph below compares the yearly percentage change in the total
cumulative return of the Common Stock from June 7, 1995 (the date trading of the
Common Stock commenced) and ending on December 31, 1999 and March 31, 2000, to
the Standard & Poor's 500 Index and the Dow Jones Entertainment & Leisure-
Casinos Index. The graph assumes that dividends were reinvested and is based on
an investment of $100 on June 7, 1995 in each of the Common Stock, the stocks
comprising the Standard & Poor's 500 Index and the stocks comprising the Dow
Jones Entertainment & Leisure-Casinos Index.
[insert graph here]
Cumulative Total Return
----------------------------------------------------------------------
6/7/95 12/95 12/96 12/97 12/98 12/99
TRUMP HOTELS & CASINO RESORTS, INC. 100 154 86 48 27 24
S&P 500 100 117 144 192 247 298
DOW JONES CASINOS 100 94 102 91 62 94
-14-
Compensation Committee Interlocks and Insider Participation
In general, the compensation of executive officers of the Company is
determined by the Compensation Committee of the Board of Directors, which
consists of Messrs. Trump, Askins and Thomas. No other officer or employee of
the Company, participated in the deliberations of the Board of Directors
concerning executive compensation.
The Company had entered into a ten-year lease with Trump-Equitable Company,
dated as of July 1, 1995, for the lease of office space in The Trump Tower in
New York City, which the Company may use for its general executive and
administrative offices. The fixed rent is $115,500 per year, paid in equal
monthly installments, for the period from July 1, 1995 to June 30, 2000 and will
be $129,250 per year, paid in equal monthly installments, for the period from
July 1, 2000 to June 30, 2005. In addition, the Company will pay as additional
rent, among other things, a portion of the property taxes due each year. The
Company exercised the option to terminate this lease and paid $32,312.50. In
March 2000, the lease was terminated and the Company moved into the office space
previously occupied by Taj Associates.
On April 27, 2000, prior to maturity, Mr. Trump repaid the outstanding
loans of $24,516,233, including interest, which were advanced to Mr. Trump in
1998 by THCR Holdings and an affiliate.
During 1996 through 1998, THCR Holdings advanced certain tax loans totaling
$812,740 to Mr. Ribis pursuant to Section 7 of the June 12, 1995 Employment
Agreement entered into between THCR Holdings and Mr. Ribis (the "Ribis
Agreement"). On June 7, 2000 Mr. Ribis agreed to satisfy and pay in full such
loans, totaling $962,475 in principal and accrued interest, by surrendering to
THCR Holdings by June 12, 2000, 69,229 shares of Common Stock of the Company
pursuant to Section 7(vii) of the Ribis Agreement. In 1996, THCR Holdings also
advanced a loan to Mr. Ribis in the amount of $1,458,469. On June 7, 2000, Mr.
Ribis satisfied such loan with the exchange of a new Promissory Note (the
"Note") in the amount of $1,856,276.85, an amount equal to the principal and
accrued interest on the original note. The Note pays interest quarterly at the
prime rate and matures on June 30, 2003, unless accelerated upon the occurrence
of certain defined events. Mr. Ribis also agreed to either pay in full or secure
the Note by July 7, 2000 with unencumbered security having a loan to value of at
least 60% in a form and amount satisfactory to the Company's Board of Directors.
Beginning in late 1997, the Company's Atlantic City properties began to
utilize certain facilities owned by Trump to entertain high-end customers.
Management believes that the ability to utilize these facilities has enhanced
the Company's revenues. In 1997, 1998 and 1999, the Company incurred
approximately $54,000, $1,100,000 and $2,209,000, respectively, for customer
costs associated with such utilization. In exchange for having Trump's plane
available to customers of the Atlantic City properties, the Company has incurred
pilot costs of approximately $265,000, $246,000 and $298,000 for the years ended
December 31, 1997, 1998 and 1999, respectively.
Certain Related Party Transactions--Taj Associates. Taj Associates had
entered into a lease with Trump-Equitable Company for the lease of office space
in Trump Tower in New York City, which Taj Associates used as a marketing
office. The monthly payments under the lease had been $1,000, and the premises
were leased at such rent for four months in 1992, the full twelve months in 1993
and 1994 and eight months in 1995. On September 1, 1995, the lease was renewed
for a term of five years with an option for Taj Associates to cancel the lease
on September 1 of each year, upon six months' notice and payment of six months'
rent. Under the renewed lease, the monthly payments are $2,285. In March 2000,
the Company moved to this office space from its previous location in Trump
Tower.
Certain Related Party Transactions--Castle Associates. On December 28,
1993, Castle Associates entered into a Services Agreement with TCI-II (the
"Castle Services Agreement"). In general, the Castle Services Agreement
obligates TCI-II to provide to Castle Associates, from time-to-time when
reasonably requested, consulting services on a non-exclusive basis, relating to
marketing, advertising, promotional and other services (the "Castle Services")
with respect to the business and operations of Castle Associates, in exchange
for certain fees to be paid only in those years in which EBITDA (EBITDA
represents income from operations before depreciation, amortization,
restructuring costs and the non-cash write-down of CRDA investments) exceeds
prescribed amounts.
-15-
In consideration for the Castle Services to be rendered by TCI-II, Castle
Associates will pay an annual fee (which is identical to the fee which was
payable under the previously existing management agreement) to TCI-II in the
amount of $1.5 million for each year in which EBITDA exceeds the following
amounts for the years indicated: 1993--$40.5 million; 1994--$45.0 million; 1995
and thereafter--$50.0 million. If EBITDA in any fiscal year does not exceed the
applicable amount, no annual fee is due. In addition, if the annual fee is
attained, TCI-II will be entitled to an incentive fee, beginning with the fiscal
year ending December 31, 1994, in an amount equal to 10% of EBITDA in excess of
$45.0 million for such fiscal year. Castle Associates will also be required to
advance to TCI-II $125,000 a month which will be applied toward the annual fee,
provided, however, that no advances will be made during any year if and for so
long as the Managing Partner (defined in the Castle Services Agreement as Trump)
determines, in his good faith reasonable judgment, that Castle Associates'
budget and year-to-date performance indicate that the minimum EBITDA levels (as
specified above) for such year will not be met. If for any year during which
annual fee advances have been made it is determined that the annual fee was not
earned, TCI-II will be obligated to promptly repay any amounts previously
advanced. For purposes of calculating EBITDA under the Castle Services
Agreement, any incentive fees paid in respect of 1994 or thereafter shall not be
deducted in determining net income. Pursuant to this agreement, Mr. Trump earned
approximately $2.3 million based on Castle Associates' EBITDA for the year ended
December 31, 1999. During the years ended 1997 and 1998, there were no fees
payable by Castle Associates under the Castle Services Agreement. As Castle
Associates did not meet the required level of EBITDA in 1996, the monthly
advances to TCI-II related to the Castle Services Agreement were suspended and
on October 6, 1996, Castle Associates recorded a receivable in the amount of
$1.25 million which represented the amounts advanced to TCI-II during the year.
This amount was offset against the fees earned for the year ended December 31,
1999. The Castle Services Agreement expires on December 31, 2005.
Mr. Trump has granted the Company and certain of its subsidiaries a license
to use certain trade and service marks in connection with their operations.
Other Relationships. The Commission requires registrants to disclose the
existence of any other corporation in which both (i) an executive officer of the
registrant serves on the board of directors and/or compensation committee, and
(ii) a director of the registrant serves as an executive officer. Messrs. Pickus
and Burke, executive officers of the Company, have served on the boards of
directors of other related entities in which members of the Company's Board of
Directors (namely, Mr. Trump) served and continue to serve as executive
officers. Management believes that such relationships have not affected the
compensation decisions made by the Company's Board of Directors in the last
fiscal year.
In 1999, Mr. Trump's compensation pursuant to the Castle Services Agreement
was $2,258,000.
John Barry, Mr. Trump's late brother-in-law, was a partner of Tompkins,
McGuire, Wachenfeld & Barry, a New Jersey law firm which provides, from time to
time, legal services to THCR and its subsidiaries. In 1999, Tompkins, McGuire,
Wachenfeld & Barry received approximately $857,000 in fees.
Certain Relationships
Affiliate party transactions are governed by the provisions of the Senior
Note Indenture, the TAC I Note Indenture, the TAC II Note Indenture and the TAC
III Note Indenture, which provisions generally require that such transactions be
on terms as favorable as would be obtainable from an unaffiliated party, and
require the approval of a majority of the independent directors of the Company
for certain affiliated transactions. Affiliated transactions with respect to
Castle Associates are governed by the indentures under which the debt securities
of Castle Associates and Castle Funding were issued.
Mr. Trump and certain affiliates have engaged in certain related party
transactions with respect to the Company and its subsidiaries. See "Executive
Compensation--Compensation Committee Interlocks and Insider Participation--
Certain Related Party Transactions--The Company," "Taj Associates," "Castle
Associates" and "Other Relationships."
Indemnification Agreements. In addition to the indemnification provisions
in the Company's and its subsidiaries' employment agreements (see "Executive
Compensation--Employment Agreements"), certain former and current directors of
Plaza Funding entered into separate indemnification agreements in May 1992 and
June 1993
-16-
with Plaza Associates pursuant to which such persons are afforded the full
benefits of the indemnification provisions of the partnership agreement
governing Plaza Associates. Plaza Associates also entered into an
indemnification trust agreement in November 1992 with Midlantic (the
"Indemnification Trustee") pursuant to which the sum of $100,000 was deposited
by Plaza Associates with the Indemnification Trustee for the benefit of the
directors of Plaza Funding and certain former directors of Trump Plaza GP to
provide a source for indemnification for such persons if Plaza Associates, Plaza
Funding or Trump Plaza GP, as the case may be, fails to immediately honor a
demand for indemnification by such persons. The indemnification agreements with
the directors of Plaza Funding and directors of Trump Plaza GP were amended in
June 1993 to provide, among other things, that Plaza Associates would (i) not
terminate, amend or modify certain agreements in a manner which may adversely
affect the rights or interests of such directors unless an additional sum of
$600,000 was first deposited with the Indemnification Trustee, and (ii) maintain
directors' and officers' insurance covering such persons during the ten-year
term (subject to extension) of the indemnification agreements; provided,
however, that if such insurance would not be available on a commercially
practicable basis, Plaza Associates could, in lieu of obtaining such insurance,
annually deposit an amount in a trust fund equal to $500,000 for the benefit of
such directors; provided further that deposits relating to the failure to obtain
such insurance shall not exceed $2.5 million. Such directors are covered by
directors' and officers' insurance maintained by Plaza Associates. In June 1993,
an additional sum of $600,000 was deposited with the Indemnification Trustee for
the benefit of the directors of Plaza Funding and certain former directors of
Trump Plaza GP.
In connection with the Taj Acquisition, Trump AC has agreed to provide to
the former officers and Directors of THCR Holding Corp. and THCR/LP (the "Taj
Indemnified Parties"), including Messrs. Ribis, Pickus and Burke,
indemnification as provided in the Company's Amended and Restated Certificate of
Incorporation and Amended and Restated By-Laws until April 17, 2002. In
addition, the Company agreed, and agreed to cause THCR Holding Corp. and THCR/LP
to agree, that until April 17, 2002, unless otherwise required by law, the
Certificate of Incorporation and By-Laws of THCR Holding Corp. and THCR/LP shall
not be amended, repealed or modified to reduce or limit the rights of indemnity
afforded to the former directors, officers and employees of THCR Holding Corp.
and THCR/LP or the ability of THCR Holding Corp. or THCR/LP to indemnify such
persons, nor to hinder, delay or make more difficult the exercise of such rights
of indemnity or the ability to indemnify. In addition, Trump AC has also agreed
to purchase and maintain in effect, until April 17, 2002, directors' and
officers' liability insurance policies covering the Taj Indemnified Parties on
terms no less favorable than the terms of the then current insurance policies'
coverage or, if such directors' and officers' liability insurance is unavailable
for an amount no greater than 150% of the premium paid by THCR Holding Corp. (on
an annualized basis) for directors' and officers' liability insurance during the
period from January 1, 1996, to April 17, 1996, Trump AC has agreed to obtain as
much insurance as can be obtained for a premium not in excess (on an annualized
basis) of such amount.
The Company, Plaza Associates, Taj Associates, Castle Associates and Trump
Indiana (collectively, the "Indemnitors") have entered into separate Indemnity
Agreements with each of Messrs. Trump, Ribis, Thomas, Ryan, and Askins, the
directors of the Company as of March 30, 2000 (the "Indemnification Agreements")
whereby the Indemnitors have agreed to indemnify and advance expenses on behalf
of each of the directors as described below to the fullest extent permitted by
applicable law. The Indemnification Agreements serve as a supplement to any
indemnification rights contained in (i) the certificate or by-laws of the
Company, and (ii) the provisions of the partnership agreement or certificate and
by-laws of each of Plaza Associates, Taj Associates, Castle Associates and Trump
Indiana and (iii) the certificate and by-laws or partnership agreement of any
other enterprise. The Indemnification Agreements provide for indemnification in
the case of (i) third-party proceedings, (ii) proceedings by or in the right of
the Company, (iii) indemnification where the third party is either wholly or
partly successful and (iv) certain other additional cases. However, in all cases
certain conditions must be met before the Indemnitors are responsible for
indemnification.
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PROPOSAL TWO
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has, upon the recommendation of the Audit Committee
and subject to ratification by the Stockholders, appointed Arthur Andersen LLP
as independent certified public accountants to report on the consolidated
financial statements of the Company for the fiscal year ending December 31, 2000
and to perform such other services as may be required of Arthur Andersen LLP.
Although stockholder ratification of the Board of Directors' selection is not
required, the Board of Directors considers it desirable for the Stockholders to
pass upon the selection of the independent auditors. If the Stockholders
disapprove of the selection of Arthur Andersen LLP as independent auditors, the
Board of Directors will consider the selection of other independent certified
public accountants. One or more representatives of Arthur Andersen LLP will be
present at the Annual Meeting, will have the opportunity to make a statement if
he or she desires and will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" RATIFICATION OF
ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
FOR 2000.
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
Directors and executive officers, and persons who own more than 10% of the
Common Stock, to file with the Commission initial reports of ownership and
reports of changes in ownership of Common Stock. Officers, Directors and greater
than 10% Stockholders are required by the Commission's rules and regulations to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company, all Section 16(a) filing requirements
applicable to its officers, Directors and greater than 10% beneficial owners of
Common Stock were complied with during the fiscal year ended December 31, 1999.
STOCKHOLDER PROPOSALS -- 2000 ANNUAL MEETING
Any proposals of Stockholders of the Company intended to be included in the
Company's proxy statement and form of proxy relating to the Company's next
annual meeting of Stockholders must be in writing and received by the Secretary
of the Company at the Company's office at 1000 Boardwalk, Atlantic City, New
Jersey 08401 no later than February 28, 2001. In the event that the next annual
meeting of Stockholders is called for a date that is not within 30 days before
or after August 3, 2001, in order to be timely, notice by the stockholder must
be received not later than the close of business on the tenth day following the
day on which such notice of the date of the annual meeting was mailed or such
public disclosure of the date of the annual meeting was made, whichever occurs
first.
Any stockholder interested in making a proposal is referred to Article II,
Section 11 of the Company's Amended and Restated By-Laws.
OTHER MATTERS
Management does not know of any matters other than the foregoing that will
be presented for consideration at the Annual Meeting. However, if other matters
properly come before the Annual Meeting, it is the intention of the persons
named in the enclosed proxy card to take such action as is in the best interests
of the Company and the Stockholders.
The entire cost of soliciting proxies from the Stockholders will be borne
by the Company. In addition to the use of the mails, proxies may be solicited by
personal interview, telephone or telegram by Directors, officers or regular
employees of the Company, who will not receive additional compensation for such
solicitation but may be reimbursed for reasonable out-of-pocket expenses
incurred in connection therewith. The Company has retained MacKenzie
-18-
Partners, Inc., a proxy soliciting firm, to assist in the solicitation of
proxies and will pay such firm a fee, estimated not to exceed $7,500 plus
reimbursement of reasonable out-of-pocket expenses, which are not expected to
exceed $7,500. Arrangements may also be made with brokerage firms and other
custodians, nominees and fiduciaries to forward proxy solicitation materials to
the beneficial owners of shares of Common Stock held of record by such persons,
in which case the Company will reimburse such brokerage firms, custodians,
nominees and fiduciaries for reasonable out-of-pocket expenses incurred by them
in connection therewith.
The Company will provide to any stockholder of record and beneficial owners
as of the Record Date, without charge upon written request to its Secretary at
1000 Boardwalk, Atlantic City, New Jersey 08401, a copy of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1999.
The principal executive offices of the Company are located at 1000
Boardwalk, Atlantic City, New Jersey 08401 and the Company's telephone number is
(609) 441-6060.
By order of the Board of Directors,
/s/ Robert M. Pickus
Robert M. Pickus
Secretary
-19-
1. DIRECTIONS TO TRUMP HOTEL CASINO-BUFFINGTON HARBOR, GARY, INDIANA
-----------------------------------------------------------------
1-800-218-7867
--------------
From O'Hare Airport
- -------------------
Leaving O'Hare take I-90 South. On the right will be an exit to 294 South-
Indiana. Take this tollway into Indiana, approximately a 55 minute drive.
Continue on I-294 which turns into I-80/94 East. Continue east across the State
Line for approximately 10 minutes to Cline Ave. Take Cline Avenue North to Exit
6, which is Columbus/Industrial Highway. Exit the ramp to the stop light and
turn left. Make a right turn at the next light. Continue to next stop light, and
turn right. You are now at the Buffington Harbor Casino Complex. Proceed to the
valet area of the Riverboat. Personnel will be located inside to further assist
you.
From Midway Airport
- -------------------
Take Cicero South to 294 South Indiana, approximately a 20 minute drive. I-294
becomes I-80/94 heading east into Indiana. From Cicero Ave., it is approximately
40 minutes. Continue east across the State Line for approximately 10 minutes to
Cline Ave. Take Cline Avenue North to Exit 6, which is Columbus/Industrial
Highway. Proceed down the ramp to the stop light and turn left, then make a
right turn at the next light. Continue to the next stop light, and turn right.
You are now at the Buffington Harbor Casino Complex. Proceed to the valet area
of the Riverboat. Personnel will be located inside to further assist you.
From Chicago
- ------------
Take I-90 South to Cline Ave. East (Exit 6). Follow signs to Buffington Harbor.
From the Skyway, take 90 East. Right after .50 cent toll, take next exit -Cline
Ave., Exit 6. Follow signs to Buffington Harbor. Proceed to the valet area of
the Riverboat. Personnel will be located inside to further assist you.
From North of Chicago
- ---------------------
Take I-94 South to I-80/94 East to Cline Ave. North. Take Cline Avenue North to
Exit 6, which is Columbus/Industrial Highway. Proceed down the ramp to the stop
light and turn left, then make a right turn at the next light. At next stop
light, turn right. You are now at the Buffington Harbor Casino Complex. Proceed
to the valet area of the Riverboat. Personnel will be located inside to further
assist you.
From the Chicago Suburbs
- ------------------------
Take I-294 South to I-80/94 East to Cline Ave. North. Take Cline Avenue North to
Exit 6, which is Columbus/Industrial Highway. Proceed down the ramp to the stop
light and turn left, then make a right turn at the next light. At next stop
light, turn right. You are now at the Buffington Harbor Casino Complex. Proceed
to the valet area of the Riverboat. Personnel will be located inside to further
assist you.
2. UPON ARRIVAL AT TRUMP HOTEL CASINO - BUFFINGTON HARBOR
------------------------------------------------------
Upon arrival at the Trump Hotel Casino, please follow signs to valet parking at
the casino pavilion. Please mention to the valet attendant that you are
attending the stockholders meeting. Upon entry to the pavilion, Trump Personnel
will further direct you to the Trump yacht and the meeting.
3. OVERNIGHT ACCOMMODATIONS FOR OUT-OF-TOWN STOCKHOLDERS
-----------------------------------------------------
Special arrangements have been made for out-of-town stockholders who wish to
stay overnight at the Trump Hotel. Please dial 1-800-218-7867 and let our staff
know that you are a stockholder and the specifics of your arrival and departure.
They will be happy to assist you.
4. ENTRY TO THE MEETING
--------------------
The stockholders meeting will begin at 11:30 A.M. (local time) aboard the Trump
yacht located at Buffington harbor. Boarding of the Trump Yacht will take place
from 11:00 A.M. - 11:30 A.M. local time. Please plan to arrive at Buffington
Harbor prior to 11:00 A.M. to board the yacht in a timely manner. Trump
personnel will be available to assist you.
NOTE: Please clip and bring the stockholder admission ticket to the stockholder
meeting. No admission will be allowed without this ticket.
Trump Hotels & Casino Resorts, Inc. Stockholder meeting
Admission Ticket
TIME: 11:30 A.M. (local time)
DATE: August 3, 2000
LOCATION: Trump Hotel Casino
One Buffington Harbor Drive
Gary, Indiana
1-800-218-7867
Stockholder
Name:
------------------------------------------------
[ ] with Spouse [ ] without Spouse
Stockholder
Address: ------------------------------------------------
------------------------------------------------
[PLEASE PRINT]
------------------------------------------------
TRUMP HOTELS & CASINO RESORTS, INC.
1000 Boardwalk
Atlantic City, New Jersey 08401
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
to be held at the Trump Hotel Casino, One Buffington Harbor Drive, Gary Indiana,
at 11:30 A.M., local time, on August 3, 2000
The undersigned hereby appoints Robert M. Pickus and Francis X. McCarthy, and
each of them, with full power of substitution, as proxies of the undersigned to
vote all shares of stock which the undersigned is entitled in any capacity to
vote at the above-stated annual meeting, and at any and all adjournments or
postponements thereof (the "Annual Meeting"), on the matters set forth on the
reverse side of this Proxy Card, and, in their discretion, upon all matters
incident to the conduct of the Annual Meeting and upon such other matters as may
properly be brought before the Annual Meeting. This proxy revokes all prior
proxies given by the undersigned.
All properly executed proxies will be voted as directed. If no instructions
are indicated on a properly executed proxy, such proxy will be voted FOR
approval of Proposals 1 and 2. All ABSTAIN votes will be counted in determining
the existence of a quorum at the Annual Meeting, but will have the same effect
as a vote AGAINST Proposal 2.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF TRUMP HOTELS &
CASINO RESORTS, INC.
Receipt of the Notice of Meeting and the Proxy Statement, dated June 23, 2000,
is hereby acknowledged.
PLEASE SIGN AND DATE ON THE REVERSE SIDE AND
MAIL THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF TRUMP HOTELS &
CASINO RESORTS, INC.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2.
Please mark boxes in blue or black ink.
1. Election of Directors FOR all nominees listed below WITHHOLD for all
nominees listed below
Nominees: Donald J. Trump, Wallace B. Askins, Don M. Thomas and Peter M. Ryan
INSTRUCTION: If you wish to withhold authority to vote for any individual
nominee, strike that nominee's name from the list above.
(Continued on reverse side)
-1-
(Continued from reverse side)
2. Proposal to ratify the appointment of Arthur Andersen LLP as the independent
public auditors of the Company for the fiscal year ending December
31, 2000. FOR AGAINST ABSTAIN
3. In the discretion of the proxies with respect to any other matters that may
properly come before the Annual Meeting.
Dated: _______________________, 2000
YOUR VOTE IS IMPORTANT. PLEASE SIGN, DATE
AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
-2-