UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): September 22, 2006
TRUMP ENTERTAINMENT RESORTS, INC.
TRUMP ENTERTAINMENT RESORTS HOLDINGS, LP
TRUMP ENTERTAINMENT RESORTS FUNDING, INC.
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(Exact Name of Registrants as Specified in Their Charters)
Delaware
Delaware
Delaware
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(State or Other Jurisdiction of Incorporation)
1-13794 13-3818402
33-90786 13-3818407
33-90786-01 13-3818405
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(Commission File Number) (IRS Employer Identification No.)
1000 Boardwalk at Virginia Avenue
Atlantic City, New Jersey 08401
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(Address of Principal Executive Offices) (Zip Code)
609-449-6515
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Employment Agreements
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On September 22, 2006, Trump Entertainment Resorts Holdings, L.P.
("TERH"), a wholly-owned subsidiary of Trump Entertainment Resorts, Inc. ("TER";
and together with TERH and TER's other subsidiaries, the "Company") entered into
new employment agreements (collectively, the "Employment Agreements") with Dale
R. Black, Executive Vice President, Chief Financial Officer; John P. Burke,
Executive Vice President, Corporate Treasurer; Joseph A. Fusco, Executive Vice
President, Government Relations & Regulatory Affairs; Paul B. Keller, Executive
Vice President, Design & Construction; Craig D. Keyser, Executive Vice
President, Human Resources and Administration; Virginia McDowell, Executive Vice
President, Chief Information Officer; Robert M. Pickus, Executive Vice President
and General Counsel; and Richard M. Santoro, Executive Vice President, Asset
Protection and Risk Management (collectively, the "Employees").
The Employment Agreements set forth each Employee's respective
position, annual base salary and benefits. Messrs. Black, Burke, Fusco, Keller,
Keyser, Pickus and Santoro, receive an annual base salary of $350,000, $235,000,
$350,000, $350,000, $275,000, $350,000 and $210,000, respectively. Ms.
McDowell's annual base salary is $350,000. Each Employee is eligible to receive
an annual incentive bonus equal to a percentage of their annual salary upon
achievement of financial parameters as approved by the Company's compensation
committee. Mr. Black is eligible to receive an annual incentive bonus equal to
an amount ranging from 60% to 100% of his annual base salary upon achievement of
certain financial parameters to be approved by the Company's compensation
committee.
Each Employee is eligible to receive grants of equity compensation
awards under any long term incentive program adopted by the Company's
compensation committee. The Employment Agreements provide these grants will vest
immediately in the event of a change of control or a change of control with
special circumstances. Each Employee is eligible for benefits and perquisites
which the Company provides to its employees generally, as determined by the
Company, for similarly situated executives.
Each Employee receives fifty-two weeks of their respective base salary
and a pro rata bonus for the then current year based on performance of the
Company in the event of termination without cause by the Company or for good
reason by the Employee. In the event of a change of control or a change in
control with special circumstances, each Employee receives two times such
Employee's annual base salary plus actual the annual incentive plan bonus paid
to such Employee in the prior year. Any severance payments provided for in the
Employment Agreements are conditioned upon the Company receiving a release from
the Employee.
Pursuant to the Employment Agreements, each Employee is subject to
certain non-competition obligations in the event of termination of employment
without good reason by the Employee or for cause by the Company. Each Employee
is also subject to certain non-solicitation obligations with respect to Company
employees and customers after termination of employment, subject to certain
exceptions provided for in the Employment Agreements.
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Each of the Employment Agreements are filed as Exhibits 10.1, 10.2,
10.3, 10.4, 10.5, 10.6, 10.7 and 10.8 to this Current Report on Form 8-K and are
incorporated by reference herein. Terms not defined herein have the meanings
ascribed to them in the Employment Agreements.
Amended Right of First Offer Agreement
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On September 22, 2006, the Company executed an amendment (the
"Amendment") to the Right of First Offer Agreement (the "ROFO Agreement") with
Trump Organization LLC (the "Developer"), Mr. Donald Trump's controlled
affiliate. Pursuant to the ROFO Agreement, the Company granted the Developer a
right of first offer to serve as development manager, project manager,
construction manager and/or general contractor for the development,
redevelopment, renovation, improvement, alteration, construction, restoration or
rehabilitation of certain projects (the "Development Services") relating to the
business of acquiring, developing, owning and operating casinos, casino hotels,
hotels and related hospitality lodging with an initial an initial budget of at
least $35 million (a "Covered Project") to be performed by third parties on the
Company's existing and future properties. The ROFO Agreement sets forth the
terms, conditions and parameters for the negotiations of the terms of any
services to be provided by the Developer.
The Company entered into the Amendment in order to utilize additional
services and the expertise of the Developer in large scale development projects,
negotiating trade and other contracts and to achieve cost savings that may not
otherwise be available to the Company. Pursuant to the Amendment, the Company
retained the Developer to provide the following additional services for Covered
Projects: (i) review and comment on the design direction for Covered Projects
undertaken by the Company or its affiliates; (ii) consult on the selection of
and fees associated with the construction manager or similar construction
professionals that will provide professional construction management or similar
services for Covered Projects; and (iii) negotiate, in conjunction with the
Company and the Company's construction manger (the "Cost Savings Services"), all
proposals or offers to provide goods or services for compensation in excess of
$1 million with respect to a Covered Project received from any third party in
response to a Company bid package or other solicitation ("Bid").
The Cost Savings Services provided by the Developer pursuant to the
terms of the Amendment are separate and independent from the Developer's right
of first offer for Development Services under the ROFO Agreement. In the event
the Developer exercises the right of first offer with respect to the Development
Services for a Covered Project, the Amendment terminates with respect to the
Cost Savings Services and the Developer will not be eligible to perform the Cost
Savings Services for the Company.
The Amendment is effective as of May 1, 2006 (the "Effective Date") and
terminates on May 19, 2008 (the "Term"). Pursuant to the Amendment, the
Developer will receive $50,000 per month for each month of the Term and 25% of
the difference between the total dollar amount of any Bid and the final dollar
amount of any agreement ultimately entered into between the Company and a third
party following negotiations with the Developer, not to exceed $5,000,000 during
the Term (subject to the payment of a bonus to the Developer at the Company's
discretion and reasonable expense reimbursement).
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The Amendment is filed as Exhibit 10.9 to this Current Report on Form
8-K and is incorporated by reference herein. Terms not defined herein have the
meanings ascribed to them in the Amendment.
ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT
As described in Item 1.01 above, the Company has entered into new
employment agreements with certain Employees. The former employment agreements
with each Employee have therefore been terminated. The information included in
Item 1.01 of this Current Report on Form 8-K is incorporated by reference into
this Item 1.02.
ITEM 8.01 OTHER EVENTS
On September 18, 2006, the Superior Court of New Jersey entered a
Consent Order of Settlement and Dismissal (the "Order") with respect to a
complaint filed by the Company against the South Jersey Transportation Authority
(the "SJTA") on November 13, 2003, pursuant to which the Company asserted that
the SJTA breached their development agreement (the "Development Agreement") with
the Company (the "Litigation").
Pursuant to the terms of the Order, the Company and the SJTA agreed to
settle the Litigation. SJTA will pay the Company a total of $1,750,000 in two
installments, in exchange for which the Company has agreed to release the SJTA
from all claims related to the Litigation. The first installment of $1,000,000
is due on or before October 16, 2006 and the second installment of $750,000 is
due on or before March 30, 2007.
ITEM 9.01 FINANCIAL STATEMENT AND EXHIBITS.
(d) Exhibits.
10.1 Employment Agreement with Dale R. Black, dated September 22,
2006.
10.2 Employment Agreement with John P. Burke, dated September 22,
2006.
10.3 Employment Agreement with Joseph A. Fusco, dated September 22,
2006.
10.4 Employment Agreement with Paul B. Keller, dated September 22,
2006.
10.5 Employment Agreement with Craig D. Keyser, dated September 22,
2006.
10.6 Employment Agreement with Virginia McDowell, dated September
22, 2006.
10.7 Employment Agreement with Robert M. Pickus, dated September
22, 2006.
10.8 Employment Agreement with Richard M. Santoro, dated September
22, 2006.
10.9 Amended Right of First Offer Agreement, made by Trump
Entertainment Resorts, Inc. and Trump Entertainment Resorts
Holdings, L.P. to Trump Organization LLC.
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Pursuant to the requirements of the Securities Exchange Act of 1934,
each of the Registrants has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: September 28, 2006
TRUMP ENTERTAINMENT RESORTS, INC.
By: /s/ Robert M. Pickus
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Name: Robert M. Pickus
Title: Executive Vice President and
Secretary
TRUMP ENTERTAINMENT RESORTS HOLDINGS, L.P.
By: /s/ Robert M. Pickus
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Name: Robert M. Pickus
Title: Executive Vice President and
Secretary
TRUMP ENTERTAINMENT RESORTS FUNDING, INC.
By: /s/ Robert M. Pickus
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Name: Robert M. Pickus
Title: Executive Vice President and
Secretary
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