The deal is part of a bankruptcy reorganization plan Icahn negotiated to help the troubled casino company emerge from Chapter 11 (click here for the full plan).

TER's debtors have come out in support of the plan, which includes:

A capital contribution of $225 million in new equity capital--in exchange for 70% of the new equity in the reorganized debtors--in the form of a rights offering to holders of the debtors' 8.5% senior secured notes due and general unsecured claims backstopped by members of the Ad Hoc Committee of the holders of the senior lien notes--who will receive 20% of the new equity in the reorganized debtors as a backstop fee in consideration for their agreement to provide such backstop;
A $125-million repayment of Beal Bank's first lien loan and reinstatement of the balance of the loan on modified terms;
Five percent of the equity in the reorganized debtors and warrants to purchase up to an additional 5% of such new equity will be issued to Trump or his affiliates;
A pro rata distribution of 5% of the new equity in the reorganized debtors to holders of second lien notes and general unsecured claims; and
No recovery for old equity.
Trump Entertainment filed for bankruptcy protection in February, the third such filing for the company--which owns Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino and Trump Marina Hotel Casino--or its corporate predecessors. The deal was negotiated with Beal Bank and Beal Bank Nevada.

Instant Insights /

Icahn, Beal Propose Reorg Plan for Trump Entertainment

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