-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, B4unol1G0p12htMSzh1ArjSKO3MTuanO58THk6MmFk75JsqZgC2a8/YAX0EBcPyK wAGaG2OaSTN9tFLupZZYHA== 0000912057-97-021594.txt : 19970624 0000912057-97-021594.hdr.sgml : 19970624 ACCESSION NUMBER: 0000912057-97-021594 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970623 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HARRAHS ENTERTAINMENT INC CENTRAL INDEX KEY: 0000858339 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 621411755 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10410 FILM NUMBER: 97628288 BUSINESS ADDRESS: STREET 1: 1023 CHERRY ROAD CITY: MEMPHIS STATE: TN ZIP: 38117 BUSINESS PHONE: 9017628600 MAIL ADDRESS: STREET 1: 1023 CHERRY ROAD CITY: MEMPHIS STATE: TN ZIP: 38117 FORMER COMPANY: FORMER CONFORMED NAME: PROMUS COMPANIES INC DATE OF NAME CHANGE: 19920703 11-K 1 FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [x] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from to Commission file number 1-10410 A. Full title of the plan and address of the plan, if different from that of the issuer named below: Harrah's Entertainment, Inc. Savings and Retirement Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Harrah's Entertainment, Inc. 1023 Cherry Road Memphis, Tennessee 38117 HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN FINANCIAL STATEMENTS AS OF DECEMBER 31, 1996 AND 1995 AND FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994 TOGETHER WITH AUDITORS' REPORT REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Trustees of Harrah's Entertainment, Inc. Savings and Retirement Plan: We have audited the accompanying statements of net assets available for benefits, with fund information, of HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN as of December 31, 1996 and 1995, and the related statements of changes in net assets available for benefits, with fund information, for each of the three years ended December 31, 1996. These financial statements and the schedules referred to below are the responsibility of the Plan Administrator. Our responsibility is to express an opinion on these financial statements and schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits, with fund information, of Harrah's Entertainment, Inc. Savings and Retirement Plan as of December 31, 1996 and 1995, and the changes in its net assets available for benefits, with fund information, for each of the three years ended December 31, 1996, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes as of December 31, 1996 (Exhibit I), of loans or fixed income obligations in default as of December 31, 1996 (Exhibit II) and of reportable transactions for the year ended December 31, 1996 (Exhibit III) are presented for purposes of additional analysis and are not a required part of the basic financial statements, but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The fund information in the statements of net assets available for benefits and the statements of changes in net assets available for benefits is presented for purposes of additional analysis rather than to present the net assets available for benefits and changes in net assets available for benefits of each fund. The supplemental schedules and fund information have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. Memphis, Tennessee, April 14, 1997. -2-
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION AS OF DECEMBER 31, 1996 Fund Information ------------------------------------------------------------------------------------------------ Participant Directed Funds ---------------------------------------------------------------------------------------------- Company Aggressive S&P 500 Long-Term Income Treasury Executive Stock Fund Stock Fund Index Fund Bond Fund Fund Fund Life Fund -------------- ------------ ----------- ---------- ------------ ----------- ----------- (Note 5) ASSETS Investments (Notes 1 and 2) Harrah's Common stock $135,632,128 $ - $ - $ - $ - $ - $ - Mutual funds - 17,773,235 - 8,902,563 - 17,164,516 - Common/collective trust fund - - 52,537,865 - - - - Guaranteed investment contracts - - - - - - 7,840,674 Corporate securities - - - - 33,710,806 - - U.S. government and agency securities - - - - 23,225,678 - - Other - - - - 2,049,979 - - Temporary investments 2,110,694 236,466 302,150 39,411 489,352 108,380 235,544 Receivables Due from participants (Note 1) - - - - - - - Interest and dividends - - - - 511,449 - - Due (to) from other funds 495,533 934,948 548,072 (33,116) (879,066) (1,136,291) 151,977 Contributions 168,851 38,056 45,266 7,485 43,182 14,123 - Other 684 - - - - - 82,203 Cash 651,044 73,014 93,296 12,169 151,099 33,465 - ------------ ----------- ----------- ---------- ----------- ----------- ----------- Total assets 139,058,934 19,055,719 53,526,649 8,928,512 59,302,479 16,184,193 8,310,398 ------------ ----------- ----------- ---------- ----------- ----------- ----------- LIABILITIES Advances from Harrah's - - - - - - (2,340,947) Bank overdrafts (1,518,147) (170,260) (217,554) (28,377) (352,343) (78,036) - Accrued expenses (199,960) (52,718) (61,572) (10,653) (60,393) (18,514) - Accounts payable - - (10,431) - (2,286,159) (3,484) (552,032) Other (31,069) (2,717) (13,097) (1,948) (14,635) (5,924) - ------------ ----------- ----------- ---------- ----------- ----------- ----------- Total liabilities (1,749,176) (225,695) (302,654) (40,978) (2,713,530) (105,958) (2,892,979) ------------ ----------- ----------- ---------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $137,309,758 $18,830,024 $53,223,995 $8,887,534 $56,588,949 $16,078,235 $ 5,417,419 ============ =========== =========== ========== =========== =========== =========== ------------------------- Non- Participant Directed Fund ---------- ESOP Fund Loan Fund Total ---------- ---------- ------------ ASSETS Investments (Notes 1 and 2) Harrah's Common stock $10,809,098 $ - $146,441,226 Mutual funds - - 43,840,314 Common/collective trust fund - - 52,537,865 Guaranteed investment contracts - - 7,840,674 Corporate securities - - 33,710,806 U.S. government and agency securities - - 23,225,678 Other - - 2,049,979 Temporary investments 1,752 - 3,523,749 Receivables Due from participants (Note 1) - 21,687,690 21,687,690 Interest and dividends - - 511,449 Due (to) from other funds (82,057) - - Contributions - - 316,963 Other - - 82,887 Cash - - 1,014,087 ------------ ------------ ------------- Total assets 10,728,793 21,687,690 336,783,367 ------------ ------------ ------------- LIABILITIES Advances from Harrah's - - (2,340,947) Bank overdrafts - - (2,364,717) Accrued expenses - - (403,810) Accounts payable (14,326) - (2,866,432) Other - - (69,390) ------------ ----------- ------------ Total liabilities (14,326) - (8,045,296) ------------ ----------- ------------ NET ASSETS AVAILABLE FOR BENEFITS $10,714,467 $21,687,690 $328,738,071 ============ =========== ============
The accompanying Notes to Financial Statements are an integral part of this statement.
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION AS OF DECEMBER 31, 1995 Fund Information ----------------------------------------------------------------------------------------------- Participant Directed Funds ----------------------------------------------------------------------------------------------- Company Aggressive S&P 500 Long-Term Income Treasury Executive Stock Fund Stock Fund Index Fund Bond Fund Fund Fund Life Fund ------------- ----------- ----------- ---------- ---------- ---------- ---------- (Note 5) ASSETS Investments (Notes 1 and 2) Harrah's Common stock $160,163,755 $ - $ - $ - $ - $ - $ - Mutual funds - 8,007,657 - 7,514,110 1,128,109 17,092,695 - Common/collective trust fund - - 36,722,025 - - - - Guaranteed investment contracts - - - - 2,045,697 - 9,451,578 Corporate securities - - - - 19,189,663 - - U.S. government and agency securities - - - - 40,736,885 - - Other - - - - 15,585 - - Temporary investments 2,359,298 259,654 471,371 87,883 631,077 183,755 203,015 Receivables Due from participants (Note 1) - - - - - - - Interest and dividends - - - - 776,309 - - Due (to) from other funds (658,790) 1,023,690 1,529,977 543,451 (915,244) (1,661,867) 104,902 Contributions 813,137 75,874 152,317 29,465 217,288 70,208 - Other 264,323 9,647 208,441 10,104 42,609 12,894 384,803 Cash 1,182 130 236 44 319 92 - ------------ ---------- ----------- ---------- ---------- ---------- ---------- Total assets 162,942,905 9,376,652 39,084,367 8,185,057 63,868,297 15,697,777 10,144,298 ------------ ---------- ----------- ---------- ---------- ---------- ---------- LIABILITIES Advances from Harrah's - - - - - - (2,543,851) Bank overdrafts (1,255,131) (138,277) (251,026) (46,801) (334,172) (97,858) - Accrued expenses (175,614) (11,355) (35,179) (5,056) (79,253) (16,261) - Accounts payable (3,936) - - - (834,973) - (549,145) Other (35,707) (52) (13,465) (4,726) (7,569) (38) - ------------ ---------- ----------- ---------- ---------- ---------- ---------- Total liabilities (1,470,388) (149,684) (299,670) (56,583) (1,255,967) (114,157) (3,092,996) ------------ ---------- ----------- ---------- ---------- ---------- ---------- NET ASSETS AVAILABLE FOR BENEFITS $161,472,517 $9,226,968 $38,784,697 $8,128,474 $62,612,330 $15,583,620 $ 7,051,302 ============ ========== =========== ========== =========== =========== =========== -------------------------- Non- Participant Directed Fund --------- ESOP Fund Loan Fund Total --------- ---------- ---------- ASSETS Investments (Notes 1 and 2) Harrah's Common stock $13,861,665 $ - $174,025,420 Mutual funds - - 33,742,571 Common/collective trust fund - - 36,722,025 Guaranteed investment contracts - - 11,497,275 Corporate securities - - 19,189,663 U.S. government and agency securities - - 40,736,885 Other - - 15,585 Temporary investments 1,634 - 4,197,687 Receivables Due from participants (Note 1) - 21,850,295 21,850,295 Interest and dividends - - 776,309 Due (to) from other funds 33,881 - - Contributions 369,075 - 1,727,364 Other 2,563 - 935,384 Cash - - 2,003 ----------- ----------- ------------ Total assets 14,268,818 21,850,295 345,418,466 ----------- ----------- ------------ LIABILITIES Advances from Harrah's - - (2,543,851) Bank overdrafts - - (2,123,265) Accrued expenses - - (322,718) Accounts payable (44,032) - (1,432,086) Other 208 - (61,349) ----------- ----------- ------------ Total liabilities (43,824) - (6,483,269) ----------- ----------- ------------ NET ASSETS AVAILABLE FOR BENEFITS $14,224,994 $21,850,295 $338,935,197 =========== =========== ============
The accompanying Notes to Financial Statements are an integral part of this statement.
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1996 Fund Information ------------------------------------------------------------------------------------------------- Participant Directed Funds ----------------------------------------------------------------------------------------------- Company Aggressive S&P 500 Long-Term Income Treasury Executive Stock Fund Stock Fund Index Fund Bond Fund Fund Fund Life Fund ------------- ----------- ------------ ----------------------------------------------------- (Note 5) NET INVESTMENT INCOME Interest $ 85,149 $ 8,625 $ 24,784 $ 4,662 $ 4,119,998 $ 8,581 $ 11,553 Dividends - 1,443,087 - 716,785 215,529 844,585 - ------------ ----------- ----------- ----------- ------------- ----------- ----------- 85,149 1,451,712 24,784 721,447 4,335,527 853,166 11,553 REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 14,523,763 1,033,468 4,104,657 1,088,641 369,001,219 3,137,358 - Aggregate cost (9,349,397) (997,824) (3,079,235) (1,085,122) (369,936,453) (3,137,358) - ------------ ----------- ----------- ----------- ------------- ----------- ----------- Net realized gain (loss) 5,174,366 35,644 1,025,422 3,519 (935,234) - - UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (31,200,751) 108,890 8,535,784 (604,669) (1,297,829) - (1,131,082) CONTRIBUTIONS Participants 10,971,541 2,438,787 3,112,800 563,096 2,850,745 1,011,163 - Company 7,492,343 1,556,769 2,006,493 389,196 2,017,605 656,236 - ------------ ----------- ----------- ----------- ------------- ----------- ----------- 18,463,884 3,995,556 5,119,293 952,292 4,868,350 1,667,399 - OTHER Distributions to participants and beneficiaries (13,300,851) (1,476,339) (3,990,424) (472,704) (6,439,459) (2,787,806) (511,468) Transfers between funds (2,627,784) 5,738,338 4,058,146 213,219 (6,466,019) 827,018 (2,886) Administrative expenses (756,772) (250,745) (333,707) (54,044) (88,717) (65,162) - ------------ ----------- ----------- ----------- ------------- ----------- ----------- NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (24,162,759) 9,603,056 14,439,298 759,060 (6,023,381) 494,615 (1,633,883) NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 161,472,517 9,226,968 38,784,697 8,128,474 62,612,330 15,583,620 7,051,302 ------------ ----------- ----------- ----------- ------------- ----------- ----------- End of year $137,309,758 $18,830,024 $53,223,995 $ 8,887,534 $ 56,588,949 $16,078,235 $ 5,417,419 ============ =========== =========== =========== ============= =========== =========== --------------------------- Non- Participant Directed Fund ----------- ESOP Fund Loan Fund Total ------------ ---------- ------------- NET INVESTMENT INCOME Interest $ 118 $ 1,527,305 $ 5,790,775 Dividends - - 3,219,986 ----------- ----------- ------------- 118 1,527,305 9,010,761 REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 1,022,357 - 393,911,463 Aggregate cost (999,591) - (388,584,980) ----------- ----------- ------------- Net realized gain (loss) 22,766 - 5,326,483 UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (2,462,944) - (28,052,601) CONTRIBUTIONS Participants - - 20,948,132 Company - - 14,118,642 ----------- ----------- ------------- - - 35,066,774 OTHER Distributions to participants and beneficiaries (755,793) - (29,734,844) Transfers between funds (50,122) (1,689,910) - Administrative expenses (264,552) - (1,813,699) ----------- ----------- ------------- NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (3,510,527) (162,605) (10,197,126) NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 14,224,994 21,850,295 338,935,197 ----------- ----------- ------------- End of year $10,714,467 $21,687,690 $ 328,738,071 =========== =========== =============
The accompanying Notes to Financial Statements are an integral part of this statement.
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1995 Fund Information ------------------------------------------------------------------------------------------------- Participant Directed Funds ------------------------------------------------------------------------------------------------- Company Aggressive S&P 500 Long-Term Income Treasury Executive Stock Fund Stock Fund Index Fund Bond Fund Fund Fund Life Fund --------------- ----------- ------------ ----------- ---------- --------- ----------- (Note 5) NET INVESTMENT INCOME Interest $ 167,091 $ 2,729 $ 18,152 $ 3,950 $ 4,063,033 $ 8,764 $ - Dividends - 281,594 222,699 487,722 - 852,043 - ------------- ----------- ------------ ----------- ------------ ----------- ----------- 167,091 284,323 240,851 491,672 4,063,033 860,807 - REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 176,823,320 2,285,069 22,733,931 4,773,759 382,169,977 - - Aggregate cost (123,347,247) (1,953,996) (19,801,212) (4,586,597) (381,528,827) - - ------------- ----------- ------------ ----------- ------------ ----------- ----------- Net realized gain (loss) 53,476,073 331,073 2,932,719 187,162 641,150 - - UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (34,479,120) 675,878 6,192,843 819,131 3,769,754 - - CONTRIBUTIONS Participants 12,600,382 933,238 2,383,150 449,623 3,316,793 1,107,898 - Company 8,769,684 551,512 1,526,255 235,605 2,418,642 719,084 - ------------- ----------- ------------ ----------- ------------ ----------- ----------- 21,370,066 1,484,750 3,909,405 685,228 5,735,435 1,826,982 - OTHER Distributions to participants and beneficiaries (14,528,025) (106,902) (2,868,583) (130,710) (7,010,748) (1,975,670) (495,602) Transfers between funds (22,763,179) 6,333,753 5,489,055 8,448,867 (2,015,058) 4,475,334 (3,086) Transfers for spin-off (16,820,769) (1,996,362) (5,522,510) (4,157,672) (6,905,858) (2,753,804) (548,938) Administrative expenses (483,416) (40,100) (106,921) (18,450) (478,985) (53,817) - ------------- ----------- ------------ ----------- ------------ ----------- ----------- NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (14,061,279) 6,966,413 10,266,859 6,325,228 (2,201,277) 2,379,832 (1,047,626) NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 175,533,796 2,260,555 28,517,838 1,803,246 64,813,607 13,203,788 8,098,928 ------------- ----------- ------------ ----------- ------------ ----------- ----------- End of year $ 161,472,517 $ 9,226,968 $ 38,784,697 $ 8,128,474 $ 62,612,330 $15,583,620 $ 7,051,302 ============= =========== ============ =========== ============ =========== =========== -------------------------- Non- Participant Directed Fund ----------- ESOP Fund Loan Fund Total --------- ----------- ------------ NET INVESTMENT INCOME Interest $ 319 $ 1,555,553 $ 5,819,591 Dividends - - 1,844,058 ----------- ----------- -------------- 319 1,555,553 7,663,649 REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 14,826,674 - 603,612,730 Aggregate cost (11,114,433) - (542,332,312) ----------- ----------- -------------- Net realized gain (loss) 3,712,241 - 61,280,418 UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (2,433,756) - (25,455,270) CONTRIBUTIONS Participants - - 20,791,084 Company 371,642 - 14,592,424 ----------- ----------- -------------- 371,642 - 35,383,508 OTHER Distributions to participants and beneficiaries (1,525,468) - (28,641,708) Transfers between funds (9,714) 44,028 - Transfers for spin-off (844,424) (1,596,056) (41,146,393) Administrative expenses 1,229 - (1,180,460) ----------- ----------- -------------- NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (727,931) 3,525 7,903,744 NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 14,952,925 21,846,770 331,031,453 ----------- ----------- -------------- End of year $14,224,994 $21,850,295 $ 338,935,197 =========== =========== ==============
The accompanying Notes to Financial Statements are an integral part of this statement.
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1994 Fund Information ---------------------------------------------------------------------------------------------- Participant Directed Funds ---------------------------------------------------------------------------------------------- Company Aggressive S&P 500 Long-Term Income Treasury Executive Stock Fund Stock Fund Index Fund Bond Fund Fund Fund Life Fund -------------- ----------- ------------ ----------- --------- ---------- ----------- (Note 5) NET INVESTMENT INCOME Interest $ 74,748 $ 145 $ 8,842 $ 102 $ 4,274,148 $ 4,484 $ 2,875 Dividends - - 603,276 11,584 - 456,209 - ------------ ----------- ------------- --------- ------------ ------------ ----------- 74,748 145 612,118 11,686 4,274,148 460,693 2,875 REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 17,486,151 - 3,124,163 - 2,879,687 - - Aggregate cost (5,599,712) - (2,717,751) - (2,971,295) - - ------------ ----------- ------------- --------- ------------ ------------ ----------- Net realized gain (loss) 11,886,439 - 406,412 - (91,608) - - UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (92,596,671) (28,813) (2,382,635) 9,075 (2,262,385) - - CONTRIBUTIONS Participants 13,313,603 75,217 2,169,629 25,989 3,618,366 754,159 - Company 9,058,805 47,402 1,415,552 17,370 2,575,445 621,675 - ------------ ----------- ------------- --------- ------------ ------------ ----------- 22,372,408 122,619 3,585,181 43,359 6,193,811 1,375,834 - OTHER Distributions to participants and beneficiaries (13,819,311) (91) (2,121,419) (549) (5,767,763) (1,145,732) (286,300) Transfers between funds (12,149,250) 2,173,104 1,222,398 1,741,979 2,482,193 4,539,095 (61,541) Administrative expenses (675,971) (6,409) (136,023) (2,304) (373,372) (45,847) - ------------ ----------- ------------- --------- ------------ ------------ ----------- NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (84,907,608) 2,260,555 1,186,032 1,803,246 4,455,024 5,184,043 (344,966) NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 260,441,404 - 27,331,806 - 60,358,583 8,019,745 8,443,894 ------------ ----------- ------------- --------- ------------ ------------ ----------- End of year $175,533,796 $2,260,555 $28,517,838 $1,803,246 $64,813,607 $13,203,788 $8,098,928 ============ =========== ============= ========== ============ ============ =========== --------------------------- Non- Participant Directed Fund ----------- ESOP Fund Loan Fund Total ----------- ----------- ---------- NET INVESTMENT INCOME Interest $ - $ 1,616,847 $ 5,982,191 Dividends - - 1,071,069 ----------- ----------- ------------ - 1,616,847 7,053,260 REALIZED GAIN (LOSS) ON INVESTMENTS Aggregate proceeds 1,276,173 - 24,766,174 Aggregate cost (693,131) - (11,981,889) ----------- ----------- ------------ Net realized gain (loss) 583,042 - 12,784,285 UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS (8,085,372) - (105,346,801) CONTRIBUTIONS Participants - - 19,956,963 Company 540,119 - 14,276,368 ----------- ----------- ------------ 540,119 - 34,233,331 OTHER Distributions to participants and beneficiaries (1,242,271) - (24,383,436) Transfers between funds 6,646 45,376 - Administrative expenses - - (1,239,926) ----------- ----------- ------------ NET INCREASE (DECREASE) IN NET ASSETS AVAILABLE FOR BENEFITS (8,197,836) 1,662,223 (76,899,287) NET ASSETS AVAILABLE FOR BENEFITS, Beginning of year 23,150,761 20,184,547 407,930,740 ----------- ----------- ------------ End of year $14,952,925 $21,846,770 $331,031,453 =========== =========== ============
The accompanying Notes to Financial Statements are an integral part of this statement. HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN The following description of Harrah's Entertainment, Inc. Savings and Retirement Plan (the "Plan," formerly The Promus Companies Incorporated Savings and Retirement Plan) is provided for general information purposes only. Reference should be made to the Plan Document for a more complete description of the Plan's provisions. The Plan Effective June 30, 1995, The Promus Companies Incorporated ("Promus") was split into two independent public corporations (the "Spin-off"). Promus, which was renamed Harrah's Entertainment, Inc. ("Harrah's"), retained the casino entertainment business. Promus' hotel operations were transferred to a newly created company, Promus Hotel Corporation ("PHC"). The agreements governing the terms of the Spin-off transaction required that the assets allocable to those participants in the Plan who became employees of PHC be transferred to a new savings and retirement plan (the "PHC Plan"), which was established for the benefit of the eligible employees of PHC and its affiliates. Concurrent with the completion of the Spin-off, the Plan was renamed the Harrah's Entertainment, Inc. Savings and Retirement Plan. Participants' investments in Promus common stock through the Company Stock Fund and the ESOP Fund were converted into investments in the common stock of their employer, either Harrah's or PHC, after the Spin-off. The Plan was established by Harrah's effective February 6, 1990, to include eligible employees of Harrah's and its affiliates (the "Company") for the primary purpose of allowing these employees to accumulate capital for their retirement. Participants can contribute either pre-tax payroll dollars (i.e., temporary deferral of federal and/or state income taxes) or after-tax dollars to the Plan, as provided for under Sections 401(k) and 401(m) of the Internal Revenue Code. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Plan Investment Funds By election of a participant, his or her account balance (comprised of contributions, Company matching funds and accumulated earnings) can be invested in one or in a combination of up to six separate funds of the Plan in 1% increments as follows. Prior to October 1, 1996, funds could be invested in 10% increments. I. Company Stock Fund - invested in Harrah's common stock which provides a return based on the change in market value of Harrah's common stock, including any dividends declared thereon; NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued) II. Aggressive Stock Fund - invested in the Delaware Trend Institutional Fund, a mutual fund comprised primarily of a mix of common stocks of emerging and other growth-oriented companies, including securities convertible to common stocks; III. S&P 500 Index Fund (formerly called the Diversified Stock Fund) - invested in the State Street Bank Flagship Fund, an S&P 500 Indexed common/collective trust fund, which provides a return based on the performance of the stocks included within the Flagship Fund, including dividends thereon; IV. Long-Term Bond Fund - invested in the Vanguard Long-Term Corporate Portfolio, a mutual fund with investments in a diversified mix of long-term investment grade bonds; V. Income Fund - invested primarily in intermediate-term bonds issued by corporations and by the U.S. Government and its agencies, as directed by Western Asset Management Company, the fund's investment manager; or VI. Treasury Fund - invested in the Dreyfus Treasury Fund, a money market mutual fund that invests solely in United States Treasury Department backed short-term securities issued by the U.S. Government. The Plan also includes three other special purpose funds, as follows: VII. Executive Life Fund - segregates the assets and participants' equity accounts related to the investment in Executive Life Insurance Company's guaranteed investment contract. See Note 5 - Executive Life Investment for further details. VIII. ESOP Fund - accounts for special contributions by Harrah's of its common stock or cash equivalents to eligible employees. The ESOP Fund was established within the Plan to serve as a means to monitor the accounts and records of the participants. Participants are not allowed to make contributions to their ESOP account and distributions can be made only after a participant terminates employment. IX. Loan Fund - separately tracks loans to participants as provided for under the Plan. See "How To Borrow Money" in the Summary Plan Description for further details. Occasionally, the Funds hold cash on a temporary basis pending investment or withdrawals. Cash balances are invested in temporary investments. Plan Administration The general administration of the Plan is the responsibility of its Trustees, who are appointed by the Human Resources Committee of the Harrah's Board of Directors, and who act as the Plan Administrator. The Trustees perform the duties and exercise the authority set forth in the Plan and Trustee Agreements. The Trustees have delegated certain of their authority to individuals for purposes of day-to-day administration. -2- NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued) Employee Eligibility, Vesting and Termination Employees of the Company become eligible to join the Plan on the first entry date (January 1 or July 1) following completion of 12 months during which the employee is credited with at least 1,000 hours of service. Participants vest in Company matching contributions over seven calendar years of credited service as follows: Years of Vested Credited Service Percentage ---------------- ---------- One 10% Two 20% Three 30% Four 40% Five 60% Six 80% Seven 100% An employee's active participation in the Plan ceases upon separation of service at which time his or her vested account balance can either be withdrawn or remain in the Plan according to the Plan Document. Plan Expenses As sponsor of the Plan, Harrah's, through its wholly-owned subsidiary Harrah's Operating Company, Inc. ("HOC"), initially pays many of the costs associated with the operation of the Plan. These costs include salaries for employees who perform administrative services solely for the Plan, rent, various service charges and other direct costs of operation. The Plan reimbursed HOC for these costs in the amounts of approximately $1.1 million, $1.2 million and $1.2 million for 1996, 1995 and 1994, respectively. Such costs are included in administrative expenses in the accompanying statements of changes in net assets available for benefits. Participants' Contributions and Withdrawals Participants can elect to make basic contributions ranging from two to six percent of their eligible earnings, as defined. These contributions are then matched by the Company. If a non-highly compensated participant is making basic pre-tax contributions of six percent of his earnings to the Plan, the participant could elect to make supplemental contributions of up to an additional 10% of which 8% can be pre-tax dollars. Highly compensated employees could contribute up to an additional 10% of after-tax dollars as supplemental contributions. The Company will match the first six percent of all participants' contributions. -3- NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued) Participants' contributions, vested matching Company contributions and related income may be withdrawn by giving 30 days written notice subject to Plan and Internal Revenue Service rules. In-service withdrawals of pre-tax contributions are subject to hardship rules if the withdrawal occurs before age 59 1/2. Withdrawal of basic after-tax and matching contributions will not prohibit participants from making further contributions; however, if these contributions or any other funds are withdrawn, the Company will not match subsequent contributions for six months. Supplemental after-tax contributions and any earnings thereon may be withdrawn without this penalty. If a participant ceases to make contributions to the Plan, the participant's equity may remain constant, except for allocation of earnings, gains and losses on the Plan's investments. Allocation of Forfeitures and Net Plan Income As required by the Plan, forfeited amounts attributed to non-vested Company matching contributions of terminated employees will not be reallocated to remaining participants for a period of five years. Employees who return to service within that period will be credited, subject to further vesting, at the date of rehire with the unallocated equity amount. The total amount of potential forfeitures of terminated non-vested participants at December 31, 1996 was approximately $2.1 million. Forfeitures are allocated to active participants based upon their total basic contributions for the year. The Plan Administrator reallocated approximately $0.3 million, $0.5 million and $0.7 million of forfeited funds during 1996, 1995 and 1994, respectively. Net Plan income (i.e. unrealized appreciation/depreciation of investments, dividend and interest income, and realized gains or losses on the sale of investments) is allocated monthly to active participants based upon the individual's prior month-end equity balance. For purposes of calculating the realized gains or losses on investments, the Plan uses a cumulative average cost per share. Loans Loans may be made to participants upon written application to the Plan Administrator. All loans, other than those used to acquire or construct the principal residence of the participant, shall be repaid within five years. The minimum amount that may be borrowed is $500. The balance of loans outstanding under the Plan to a participant may not exceed $50,000 (which maximum is subject to reduction if another loan is outstanding) or one-half of the vested balance of the participant's account, whichever is less. Loans bear interest at a rate set by the Plan Administrator, and are secured by the account balance of the participant equal to the outstanding loan amount. Principal and interest paid by a participant are credited to the participant's account. At both December 31, 1996 and 1995, these loans had interest rates ranging from 7.5% to 9.5%. -4- NOTE 1 - SUMMARY DESCRIPTION OF THE PLAN (Continued) Accounting Policies The American Institute of Certified Public Accountants issued Statement of Position 94-4 ("SOP 94-4"), "Reporting of Investment Contracts Held by Health and Welfare Benefit Plans and Defined-Contribution Pension Plans," effective for fiscal years beginning after December 15, 1994. The application of SOP 94-4 to investment contracts entered into before December 31, 1993, is delayed to plan years beginning after December 15, 1995. SOP 94-4 changes the Plan's reporting for certain investment contracts (as defined in SOP 94-4) from contract value to fair market value. The Plan adopted SOP 94-4 during 1996, which resulted in a reduction in the carrying value of the Executive Life Insurance guaranteed investment contract of approximately $1.1 million. This reduction is included in unrealized appreciation (depreciation) of investments in the accompanying statement of changes in net assets available for benefits. The contract value as of December 31, 1996 was approximately $9.0 million. See Note 5 for further discussion. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates. NOTE 2 - VALUATION OF INVESTMENTS Investments in securities, common/collective trust funds and mutual funds are stated at market values on the last business day of the plan year. NOTE 3 - INVESTMENTS The fair market values of individual investments that represent 5% or more of the Plan's total net assets as of December 31, 1996 and 1995, were as follows:
1996 1995 ------------ ------------ Harrah's Entertainment, Inc. $146,441,226 $171,918,946 Common Stock Delaware Trend Institutional Fund 17,773,235 8,007,657 Dreyfus Treasury Fund 17,164,516 17,092,695 State Street Bank Flagship Fund 52,537,865 36,722,025 Loans to Participants 21,687,690 21,850,295
-5- NOTE 4 - EXCESS CONTRIBUTIONS Certain plan participants received a refund of a portion of their contributions and attributable earnings totaling approximately $54,000, $53,000 and $63,000 in 1996, 1995 and 1994, respectively. These refunds were paid in accordance with Internal Revenue Code Section 401(m) which requires that certain nondiscriminatory tests related to the overall composition of participants' contributions be met and Section 415 which requires annual contributions not to exceed 25% of the participant's compensation, as defined. NOTE 5 - EXECUTIVE LIFE INVESTMENT On May 1, 1991, the Plan was amended to provide that approximately $12.9 million attributable to a guaranteed investment contract issued by Executive Life Insurance Company ("Executive Life") and held in the Plan's Income Investment Fund would be frozen until such time as the contract is finally paid out. The $12.9 million represented the book value of this contract as of March 31, 1991. The action was taken by the Company due to the conservatorship imposed on Executive Life by the State of California Insurance Commissioner. The Company has agreed to pay to the Plan any deficiency between the $12.9 million and any amounts finally paid under the contract. The Company has also agreed to make interest free loans to the Plan, which are to be repaid out of any amounts received under the contract, so that persons who leave or who have already left the Company's employment may withdraw the vested portion of the Executive Life guaranteed investment contract, as well as other vested funds. Amounts loaned to the Plan are reflected in the accompanying statements of net assets available for benefits as advances from Harrah's. On September 3, 1993, the California Department of Insurance closed on a rehabilitation transaction with Aurora National Life Assurance Company ("Aurora"), whereby substantially all Executive Life assets and restructured liabilities were transferred to Aurora. Additionally, on September 3, 1993, Aurora made a payment of approximately $1.9 million to the Plan which reduced the principal of the Executive Life contract. Of this payment, approximately $0.4 million was paid to Harrah's to reduce the advances from Harrah's balance. The remaining amount was used to unfreeze part of the Executive Life Fund for each participant on a pro-rata basis. On February 4, 1994, the Plan elected to participate in an ongoing rehabilitation plan offered by Aurora. This plan provides for recovery of a minimum of 77.7% of the March 31, 1991, book value. On July 29, 1996, Aurora made a payment of approximately $0.1 million to the Plan which reduced the principal of the Executive Life contract. This payment will be used to unfreeze part of the Executive Life Fund for each participant on a pro-rata basis. Under the Plan Amendment that governs the Executive Life contract, non-benefit responsive distributions are allocated pro-rata among the remaining participants (based upon their investment in the contract) and to the Company (based on the Plan's payable to the Company). Benefit responsive distributions are allocated to the Company as the -6- NOTE 5 - EXECUTIVE LIFE INVESTMENT (Continued) Company previously loaned the Plan the funds for the distributions. In April 1995, Aurora began honoring requests for distributions for terminated participants, as well as for hardship withdrawals. During 1996, Aurora discontinued reimbursements for hardship withdrawals. Harrah's remains liable to the Plan for any deficiency between the book value and amounts ultimately received. The restructured contract matures on September 3, 1998, and is presently earning interest at approximately 5%. The accounts payable balance for the Executive Life Fund as of December 31, 1996 and 1995, primarily represents a payable to the PHC Plan for that plan's portion of the Executive Life contract (see Note 1). The plan administrator expects the contract to be split into two separate contracts during 1997. NOTE 6 - PLAN QUALIFICATION The Plan is intended to satisfy the tax qualification requirements under Section 401(a) of the Internal Revenue Code ("IRC"); therefore, the trust funds of the Plan are intended to be exempt from federal income taxes under Section 501(a). A favorable determination letter regarding the Plan's status, dated November 19, 1992, has been received from the Internal Revenue Service. The Plan has been amended since receiving the determination letter; however, the plan administrator and the Plan's legal counsel believe that the Plan is designed and is currently being operated in compliance with the applicable requirements of the IRC. NOTE 7 - PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100% vested in their accounts. NOTE 8 - RECONCILIATION TO FORM 5500 As of December 31, 1996 and 1995, the Plan had approximately $0.7 million and $2.0 million, respectively, of pending distributions to participants who elected to withdraw from the Plan. These amounts are recorded as a liability in the Plan's Form 5500; however, these amounts are not recorded as a liability in the accompanying statement of net assets available for benefits in accordance with generally accepted accounting principles. -7- NOTE 8 - RECONCILIATION TO FORM 5500 (Continued) The following table reconciles net assets available for benefits per the financial statements to the Form 5500 as filed by the Company for the years ended December 31, 1996 and 1995:
NET ASSETS NET ASSETS BENEFITS AVAILABLE FOR AVAILABLE FOR PAYABLE TO BENEFITS BENEFITS PARTICIPANTS BENEFITS PAID DECEMBER 31,1995 DECEMBER 31, 1996 ------------ ------------- ---------------- ----------------- Per financial statements $ - $29,734,844 $338,935,197 $328,738,071 Accrued benefit payment 700,000 700,000 - (700,000) Reversal of 1995 accrual for benefit payment - (2,000,000) (2,000,000) - -------- ----------- ------------ ------------ Per Form 5500 $700,000 $28,434,844 $336,935,197 $328,038,071 ======== =========== ============ ============
NOTE 9 - SUBSEQUENT EVENT Subsequent to December 31, 1996, Harrah's announced the sale of its ownership interest in two limited stakes casinos located in Colorado, subject to regulatory approval, and discontinued managing those casinos on March 31, 1997. This event qualifies as a disposition of a subsidiary as defined in the Plan Document, which resulted in the immediate vesting of all affected participants. -8- EXHIBIT I Page 1 of 4 HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1996
COST MARKET VALUE ------------ ------------ HARRAH'S ENTERTAINMENT, INC. COMMON STOCK Company Stock Fund* $108,400,619 $135,632,128 ESOP Fund* 9,035,933 10,809,098 ------------- ------------- 117,436,552 146,441,226 ------------- ------------- MUTUAL FUNDS Delaware Trend Institutional Fund 16,900,229 17,773,235 Dreyfus Treasury Fund 17,164,516 17,164,516 Vanguard - Long-Term Corporate Portfolio 8,758,809 8,902,563 -------------- -------------- 42,823,554 43,840,314 -------------- -------------- COMMON/COLLECTIVE TRUST FUND State Street Bank Flagship Fund 36,059,519 52,537,865 -------------- -------------- GUARANTEED INVESTMENT CONTRACTS Executive Life Insurance Company 8,971,756 7,840,674 -------------- -------------- CORPORATE SECURITIES Asset Securitization Corporation Series 1996-MD6 Class A1A, 6.72%, dated 12/17/96, due 11/13/26 1,112,375 1,108,910 Bridgestone/Firestone Master Trust Series 1996-1 Class A, 6.17%, dated 11/8/96, due 7/1/03 1,592,000 1,591,648 Champion Home Equity Loan Series 1995-2 Class A2, Variable Rate, dated 5/1/95, due 5/25/50 520,928 521,601 Citibank Credit Card Master Trust Series 1996-1 Class A, 0.00%, dated 1/29/96, due 2/7/03 1,156,250 1,249,680 Cityscape Home Equity Loan Trust Series 1996-4 Class AIO, 7.40%, dated 12/9/96, due 9/25/27 1,000,000 1,000,000 Contimortgage Home Equity Loan Trust Series 1995-1 Class A2A, 8.60%, dated 2/23/95, due 2/15/10 481,944 485,271 Deutsche Bank Financial, 6.70%, dated 12/13/96, due 12/13/06 1,694,747 1,665,592 DLJ Mortgage Acceptance Corporation Series 1996-CF2, Class A1A, 6.86%, dated 11/1/96, due 7/1/05 875,633 872,348
EXHIBIT I Page 2 of 4
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1996 COST MARKET VALUE ----------- ------------ CORPORATE SECURITIES (CONTINUED) Donaldson Lufkin and Jenrette, 5.625%, dated 2/15/96, due 2/15/16 $ 1,241,136 $ 1,245,491 Faxco Series 1996-BA1 Class A, 9.05%, dated 9/1/96, due 3/13/03 945,950 948,503 Ford Motor Credit Corporation Note, 7.75%, dated 11/15/92, due 11/15/02 1,232,539 1,209,625 First Boston Mortgage Securities Corporation, Series A Class IO, 9.488%, dated 3/1/87, due 5/16/18 316,816 331,632 First Boston Mortgage Securities Corporation, Series A Class PO, 0.00%, dated 3/1/87, due 5/16/18 960,474 970,299 Green Tree Financial Corporation Series 1994-A Class A, 6.90%, dated 3/24/94, due 2/15/04 1,064,721 1,082,927 Heller Financial Inc., 6.50%, dated 11/4/96, due 11/1/01 996,730 989,860 Lehman Brothers Mortgage Trust Series 1990-5 Class A1, Adjustable Rate, dated 9/1/90, due 10/25/20 1,622,790 1,659,167 Mego FHA 1996-2, Class A1, 7.275%, dated 8/1/96, due 8/25/17 949,113 956,029 Merrill Lynch Mortgage Invs Inc. Series 1996-C2 Class A1, 6.69%, dated 11/1/96, due 11/21/28 815,247 806,655 Mid-State Trust II Mortgage Backed Note Class A-4, 9.625%, dated 4/1/88, due 4/1/03 P/Q 1,235,287 1,204,782 Old Stone Credit Corporation Home Equity Trust Series 1992-3 Class A2, 6.30%, dated 8/25/92, due 9/25/07 97,573 101,410 Oakdale Series 94-1 Class 144A, 7.95%, dated 4/1/94, due 5/1/01 1,045,313 1,037,100 Option One Cts Arm Trust Series 1996-1 Class IO, Floating Rate, dated 3/14/96, due 3/25/01 266,161 200,862 Phillip Morris, 6.95%, dated 6/1/96, due 6/1/06 999,640 1,013,100 Salomon, Inc. Mtn, Floating Rate, dated 11/4/96, due 11/5/97 2,000,000 1,992,200 Securitized Asset Sales Inc. Series 1995-6 Class AP, 0.00%, dated 11/1/95, due 12/25/10 144,889 170,527 Standard Credit Card Trust Series 1995-9 Class A, 6.55%, dated 10/13/95, due 10/7/07 1,468,713 1,473,390 TCI Communications, Inc., Variable Rate, dated 9/13/95, due 9/15/10 1,188,552 1,192,128
EXHIBIT I Page 3 of 4
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1996 Cost Market Value ------------ ------------ CORPORATE SECURITIES (CONTINUED) The Money Store Home Equity Trust Series 1995-A2 Class A7, Floating Rate, dated 3/30/95, due 6/15/25 $ 582,657 $ 583,074 Time Warner Inc., 7.75%, dated 6/15/95, due 6/15/05 1,450,932 1,424,500 USL Capital Corporation Mtn, 7.76%, dated 3/29/95, due 3/29/02 924,449 915,710 Wachovia Capital Trust I, 7.64%, dated 12/16/96, due 1/15/27 1,300,000 1,300,000 World Financial Network Credit Card Master Trust Series 1996-B Class A, 6.95%, dated 5/9/96, due 4/15/06 1,197,375 1,222,501 YPF Sociedad Anonima, 7.5%, dated 10/26/95, due 10/26/02 1,178,405 1,184,284 ------------ ------------ 33,659,339 33,710,806 ------------ ------------ U.S. GOVERNMENT AND AGENCY SECURITIES U.S. Treasury Bill, due 1/9/97 194,591 194,591 U.S. Treasury Note, 6.875%, dated 5/15/96, due 5/15/06 1,715,354 1,762,907 U.S. Treasury Note, 7.00%, dated 7/15/96, due 7/15/06 2,953,248 2,909,368 U.S. Treasury Note, 6.125%, dated 12/31/96, due 12/31/01 2,994,401 2,988,750 FHLMC Multiclass Mortgage Partn CTFS GTD REMIC Trust Series 1345 Class A, 0.00%, dated 7/1/92, due 7/15/22 251,529 248,401 FHLMC Gold Pool #C90020, 6.50%, dated 6/1/93, due 6/1/13 522,435 523,641 FHLMC Pool #181282, 7.50%, dated 8/1/82, due 9/1/07 635,363 631,198 FNMA GTD REMIC Pass Thru CTF REMIC Trust Series 4 Class 2 Strip, 9.50%, dated 3/1/87, due 2/25/17 78,897 97,929 FNMA Pool #303323, 9.00%, dated 4/1/95, due 4/1/25 597,493 613,252 GNMA II Pool #8585, Adjustable Rate, dated 1/1/95, due 1/20/25 1,950,764 1,944,777 GNMA Pool #286149, 9.50%, dated 1/1/90, due 1/15/05 369,674 361,305 GNMA Pool #302318, 9.50%, dated 1/1/91, due 1/15/06 567,679 555,360 Resolution Trust Corporation Series 1991-3 Class 3A, Floating Rate, dated 8/1/91, due 8/25/21 419,424 429,490 Resolution Trust Corporation Series 1991-4 Class B, Adjustable Rate, dated 8/1/91, due 2/25/21 716,453 747,871 Resolution Trust Corporation Series 1991-6 Class A1, Adjustable Rate, dated 9/1/91, due 5/25/19 257,470 264,949 Resolution Trust Corporation Series 1991-7 Class A, 7.75%, dated 9/1/91, due 12/25/18 568,981 580,832
EXHIBIT I Page 4 of 4
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1996 COST MARKET VALUE ------------ ------------ U.S. GOVERNMENT AND AGENCY SECURITIES (CONTINUED) Resolution Trust Corporation Series 1991-11 Class 3A, Adjustable Rate, dated 10/1/91, due 10/25/21 $ 497,070 $ 499,724 Resolution Trust Corporation Series 1991-15 Class A2, Floating Rate, dated 10/1/91, due 7/25/20 2,169,967 2,265,339 Resolution Trust Corporation Series 1991-M6 Class A2, Floating Rate, dated 12/1/91, due 6/25/21 1,646,179 1,808,315 Resolution Trust Corporation Series 1992-3 Class A1, Adjustable Rate, dated 2/1/92, due 11/25/21 871,766 869,374 Resolution Trust Corporation Series 1992-M4 Class A2, Floating Rate, dated 5/1/92, due 9/25/21 935,698 956,546 Resolution Trust Corporation Series 1992-12 Class A1, Variable Rate, dated 9/1/92, due 8/25/22 799,848 802,844 Resolution Trust Corporation Series 1992-15 Class A3, 10.00%, dated 4/1/96, due 7/25/27 1,180,362 1,168,915 ------------ ------------ 22,894,646 23,225,678 ------------ ------------ OTHER Long-term bond futures, expire 3/19/97 (14,954) (14,954) United Mexican States, Floating Rate, dated 8/5/96, due 8/6/01 895,500 901,125 Province of Quebec, step up, dated 2/29/96, due 2/27/26 1,200,000 1,163,808 ------------ ------------ 2,080,546 2,049,979 ------------ ------------ LOANS TO PARTICIPANTS, 7.5% to 9.5% N/A 21,687,690 ------------ ------------ TEMPORARY INVESTMENTS Salomon Brothers, Inc. investment cash Company Stock Fund 2,210 2,210 ESOP Fund 1,752 1,752 Fidelity Money Market Trust 3,519,787 3,519,787 ------------ ------------ 3,523,749 3,523,749 ------------ ------------ Total Investments $267,449,661 $334,857,981 ============ ============
* Represents a party-in-interest transaction. EXHIBIT II
HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1996 Current Value of Cost of Assets on Purchase Selling Assets Transaction Gain Description Price Price Sold Date (Loss) - -------------------------------------------------- ----------- ----------- ------------ ----------- -------- Fidelity Institutional Cash Purchases/sales $80,779,838 $81,907,946 $(81,907,946) $81,907,946 $ - Fidelity Money Market Trust Purchases/sales 62,034,000 62,884,509 (62,884,509) 62,884,509 - U.S. Treasury Note, 5.25%, dated 1/31/96, due 1/31/01 Purchases/sales 17,915,069 17,934,695 (17,915,069) 17,934,695 19,626 U.S. Treasury Note, 6.125%, dated 4/10/96, due 3/31/98 Purchases/sales 22,151,800 22,042,460 (22,151,800) 22,042,460 (109,340)
Signature -------------- Pursuant to the requirements of the Securities Exchange Act of 1934, the Trustees have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. HARRAH'S ENTERTAINMENT, INC. SAVINGS AND RETIREMENT PLAN Dated: June 23, 1997 By: /S/ MICHAEL N. REGAN ---------------------------------- MICHAEL N. REGAN Authorized Trustee of the Plan and Vice President and Controller of Harrah's Entertainment, Inc. CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report dated April 14, 1997, included in this Form 11-K for the year ended December 31, 1996, into Harrah's previously filed Registration Statement File No. 33-59975. ARTHUR ANDERSEN LLP Memphis, Tennessee, April 14, 1997. -----END PRIVACY-ENHANCED MESSAGE-----