Indemnity Agreement - THCR Enterprises LLC and Donald J. Trump
INDEMNITY AGREEMENT
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This Indemnity Agreement is entered into as of November 2, 2001 (the
"Agreement"), by THCR Enterprises LLC, a Delaware limited liability company
("Enterprises") in favor of Donald J. Trump ("Trump").
WHEREAS, Enterprises and THCR Management Services, LLC ("Management")
are each indirect wholly-owned subsidiaries of Trump Hotels & Casino Resorts
Holdings, L.P.;
WHEREAS, Management is entering into a Loan Agreement with certain
Lenders;
WHEREAS, Trump is entering into that certain Guaranty of even date
herewith in favor of Lenders, pursuant to which Trump guaranteed to Agent the
full and punctual payment of the Guaranteed Obligations (as defined in the
Guaranty);
WHEREAS, Trump is willing to provide such Guaranty on the condition
that he be indemnified as provided herein and Enterprises has concluded that it
is in the best interests of Enterprises to provide to Trump the protections of
this Agreement; and
WHEREAS, to further assure that Trump will obtain the benefits of the
rights to indemnification and advances contemplated by this Agreement,
notwithstanding future uncertainties, Enterprises has concluded that it would be
in the best interests of Enterprises for such rights to be secured by a pledge
of certain assets of Enterprises.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, Enterprises and Trump do hereby covenant and agree as follows:
1. Indemnification. Enterprises hereby agrees to indemnify and hold
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harmless Trump, and his successors, assigns, estate, heirs and personal
representatives, against any and all losses, costs, or expenses (including,
without limitation, any reasonable legal, accounting, and other expenses for
defending any actions or threatened actions) incurred by Trump or any of such
successors, assigns, estate, heirs and/or personal representatives under the
provisions of the Guaranty (the "Trump Guaranteed Obligations").
2. Indemnification Procedure. Whenever any demand shall be made upon
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Trump under the Guaranty, Trump shall promptly notify Enterprises of such demand
and provide a copy of any written document delivered to Trump relating to such
demand; provided, however, that so long as Trump shall directly or indirectly
control Enterprises, any demand upon or notice to Trump under the Guaranty shall
constitute notice to Enterprises under this Agreement as well and no additional
notice to Enterprises shall be required under this Agreement unless and until
Trump no longer directly or indirectly controls Enterprises. No notice need be
given by Trump
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unless and until he has received written notice of the demand. Within fifteen
(15) days of notice to Enterprises of any such demand, Enterprises shall either
satisfy and pay in full such demand or assume the defense of such demand at its
sole cost and expense. If Enterprises shall fail to satisfy any such demand or
fail to assume in a reasonable manner the defense of any demand arising under
the Guaranty within the time period set forth above, Trump shall be free to
defend, settle, litigate, appeal and otherwise act in his sole discretion, and
Enterprises shall be obligated to pay in full any settlement, judgment or
similar liability and all costs associated therewith including reasonable
out-of-pocket legal fees and disbursements and shall not have any defense based
on the reasonableness or necessity of Trump's actions or his failure to defend
effectively such demand.
3. Other Rights to Indemnification. The rights to indemnification
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and advances provided by this Agreement shall not be deemed exclusive of any
other rights to which Trump may now or in the future be entitled under any other
agreement or any provision of applicable law.
4. Security Interest. In order to induce Trump to provide the
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Guaranty and in order to provide further assurance of payment to Trump of
indemnification and advance amounts to which he may become entitled under this
Agreement, Enterprises hereby pledges, assigns and delivers to Trump and grants
to Trump a first priority security interest in all of the securities described
on the attached Schedule A, together with all dividends, interest, proceeds and
any other sums due or to become due thereon, all instruments, securities or
other property at any time and from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
securities, and all proceeds thereof, as security for the payment and
performance of all obligations owing by Enterprises to Trump under this
Indemnity Agreement, whether direct or indirect, absolute or contingent, due or
to become due, now existing or hereafter arising.
5. Enforcement.
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a. Enterprises unconditionally and irrevocably agrees that its
execution of this Agreement shall also constitute a stipulation by which it
shall be irrevocably bound in any court in which a proceeding by Trump for
enforcement of his rights shall have been commenced, continued or appealed that
obligations of Enterprises set forth in this Agreement are unique and special,
and that failure of Enterprises to comply with the provisions of this Agreement
will cause irreparable and irremediable injury to Trump, for which a remedy at
law will be inadequate. As a result, in addition to any other right or remedy he
may have at law or in equity with respect to a violation of this Agreement,
Trump shall be entitled to injunctive or mandatory relief directing specific
performance by Enterprises of its obligations under this Agreement. Enterprises
further irrevocably stipulates and agrees that it shall not, except in good
faith, raise any objections not specifically relating to the merits of Trump's
claim.
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b. In the event that Trump is subject to or intervenes in any
legal action in which the validity or enforceability of this Agreement is at
issue or institutes any legal action, for specific performance or otherwise, to
enforce his rights under, or to recover damages for breach of, this Agreement,
Trump shall, within thirty (30) days after written request to Enterprises
therefor, be indemnified by or receive advances from Enterprises in respect of
all costsand expenses (including attorney's fees and disbursements) incurred by
him in connection therewith.
6. Duration of Agreement.
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a. This Agreement shall continue until and terminate upon the
later of (i) the termination of the Guaranty according to its term, or (ii) the
full satisfaction of the obligations of Management under the Loan Agreement.
b. This Agreement shall be binding upon Enterprises and its
successors and assigns and shall inure to the benefit of Trump and his heirs,
devisees, executors, administrators or other legal representatives.
7. Severability. If any provision or provisions of this Agreement
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shall be held to be invalid, illegal or unenforceable under any particular
circumstances or for any reason whatsoever (i) the validity, legality and
enforceability of the remaining provisions of this Agreement (including, without
limitation, all other portions of any Section, paragraph of clause of this
Agreement that contains any provision that has been found to be invalid, illegal
or unenforceable), or the validity, legality or enforceability under any other
circumstances shall not in any way be affected or impaired thereby and (b) to
the fullest extent possible consistent with applicable law, the provisions of
this Agreement (including, without limitation, all other portions of any
Section, paragraph or clause of this Agreement that contains any such provision
that has been found to be invalid, illegal or unenforceable) shall be deemed
revised, and shall be construed so as to give effect to the intent manifested by
this Agreement (including the provision held invalid, illegal or unenforceable).
8. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall for all purposes be deemed to be an original,
but all of which together shall constitute one and the same Agreement. Only one
such counterpart singed by the party against whom enforceability is sought needs
to be produced to evidence the existence of this Agreement.
9. Headings. The headings of the paragraphs of this Agreement are
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inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
10. Modification and Waiver. No supplement, modification or
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amendment of this Agreement shall be binding unless executed in writing by both
parties hereto. No waiver of
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any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provision hereof (whether or not similar) nor shall such
waiver constitute a continuing waiver.
11. Notification and Defense of Claim. Trump agrees to promptly
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notify the Partnership in writing upon being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
matter which may be subject to indemnification covered hereunder, whether civil,
criminal or investigative; provided, however, that the failure of Trump to give
such notice to Enterprises shall not adversely affect Trump's rights under this
Agreement.
12. Notices and Payments. All notices, requests, demands and other
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communications hereunder shall be in writing and shall be deemed to have been
duly given upon delivery thereof if (i) delivered by hand, or sent via telecopy
or facsimile transmission, in each case receipted for by the party to whom such
notice or other communication shall have been directed or transmitted, (ii)
mailed by certified or registered mail with postage prepaid, or (iii) delivered
by overnight courier service:
a. if to Trump, at the address indicated on the signature page
hereof, with copy to:
Bernard R. Diamond
FAX No. 212-317-0037
and
b. if to Enterprises:
THCR Enterprises, LLC
Huron Avenue & Brigantine Boulevard
Atlantic City, New Jersey 08401
Attention: Robert M. Pickus
FAX No. 609-340-5041
or to such other address as may have been furnished to any party by any other
party.
All payments by Enterprises to Trump hereunder shall be
effected by payment of cash or delivery of a certified or official bank check in
the amount of the claim or liability within five (5) days after demand therefor
and if interest must be paid by Trump on the liability for which indemnity is
due, Enterprises shall deliver an amount adequate to pay interest to the date on
which funds are available to Trump for payment of such liability. Payments
required to be made by Enterprises pursuant to the Indemnity Agreement shall be
made immediately upon
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demand, without deduction, withholding or set-off, and free and clear of any
claim, counterclaim or defense against Trump.
13. Governing Law. The parties hereto agree that this Agreement shall
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be governed by, and construed and enforced in accordance with, the laws of the
State of New York without regard to conflict of law principles thereunder.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THCR ENTERPRISES, LLC
By: THCR Enterprises, Inc.
By: /s/ Robert M. Pickus
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Robert M. Pickus
Executive Vice President
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