P;|NYC\7069NYC0\
<PAGE>
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 [FEE REQUIRED]
For the fiscal year ended DECEMBER 31, 1999
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 1-11569
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
3700 West Flamingo Road
Las Vegas, Nevada 89103
--------------------------------------------------------------------------------
(Full title of the plan and the address of the plan)
HARRAH'S ENTERTAINMENT, INC..
5100 West Sahara Avenue, Suite 200
Las Vegas, Nevada 89146
--------------------------------------------------------------------------------
(Name of issuer of the securities held
pursuant to the plan and the address of
its principal executive office)
This document consists of 13 pages. Exhibit Index on page 13.
<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Report of Independent Public Accountants 3
Statements of Net Assets Available for Benefits
as of December 31, 1999 and 1998 4-5
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1999 6
Notes to Financial Statements 7-10
Schedules:
I. Schedule of Assets Held for Investment
Purposes as of December 31, 1999 11
</TABLE>
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<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors
of Rio Suite Hotel & Casino, Inc.:
We have audited the accompanying statements of net assets available for benefits
of the RIO SUITE HOTEL & CASINO EMPLOYEE RETIREMENT SAVINGS PLAN (the Plan) as
of December 31, 1999 and 1998, and the related statement of changes in net
assets available for benefits for the year ended December 31, 1999. These
financial statements and the schedule 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 auditing standards generally accepted
in the United States. 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 of the Plan as of
December 31, 1999 and 1998, and the changes in net assets available for benefits
for the year ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes as of December 31, 1999 is presented for the purpose of
additional analysis and is not a required part of the basic financial statements
but is 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 statement 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 schedule 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.
ARTHUR ANDERSEN LLP
Memphis, Tennessee
June 23, 2000.
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<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Fidelity Institutional
---------------------------------------------------------------------------------
Managed Money Market Intermediate
Magellan Balanced Income Market Index Bond
Fund Fund Portfolio Portfolio Fund Fund
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT MARKET VALUE:
Magellan Fund $ -- $ -- $ -- $ -- $ -- $ --
Balanced Fund -- -- -- -- -- --
Managed Income Portfolio -- -- 1,973,077 -- -- --
Money Market Portfolio -- -- -- -- -- --
Spartan U.S. Equity Index Fund -- -- -- -- 89,656 --
Intermediate Bond Fund -- -- -- -- -- --
Harrah's Common Stock Fund -- -- -- -- -- --
Loan Account -- -- -- -- -- --
Pending Transfer 16,196,149 4,536,218 -- 1,593,309 5,573,876 683,114
----------- ----------- ----------- ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $16,196,149 $ 4,536,218 $ 1,973,077 $ 1,593,309 $ 5,663,532 $ 683,114
=========== =========== =========== =========== =========== ===========
<CAPTION>
Fidelity Financial
-----------------------------------------
Harrah's Common Money
Stock Market Disbursement Loan
Fund Fund Account Account Total
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT MARKET VALUE:
Magellan Fund $ -- $ -- $ -- $ -- $ --
Balanced Fund -- -- -- -- --
Managed Income Portfolio -- -- -- -- 1,973,077
Money Market Portfolio -- 18,085 98,443 -- 116,528
Spartan U.S. Equity Index Fund -- -- -- -- 89,656
Intermediate Bond Fund -- -- -- -- --
Harrah's Common Stock Fund 5,662,184 -- -- -- 5,662,184
Loan Account -- -- -- 1,446,039 1,446,039
Pending Transfer -- -- -- 16,148 28,598,814
----------- ----------- ----------- ----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $ 5,662,184 $ 18,085 $ 98,443 $ 1,462,187 $37,886,298
=========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of this financial statement.
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<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1998
<TABLE>
<CAPTION>
Fidelity Institutional
------------------------------------------------------------------------------------------
Managed Money Market Intermediate
Magellan Balanced Income Market Index Bond
Fund Fund Portfolio Portfolio Fund Fund
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT MARKET VALUE:
Magellan Fund $ 9,096,399 $ -- $ -- $ -- $ -- $ --
Balanced Fund -- 3,416,002 -- -- -- --
Managed Income Portfolio -- 1,410,085 -- -- --
Money Market Portfolio -- -- -- 847,072 -- --
Market Index Fund -- -- -- -- 2,707,636 --
Intermediate Bond Fund -- -- -- -- -- 358,211
Rio Common Stock Fund -- -- -- -- -- --
Loan Account -- -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------
Total Investments 9,096,399 3,416,002 1,410,085 847,072 2,707,636 358,211
RECEIVABLES:
Receivables 69,342 35,316 17,622 14,490 43,368 5,033
Loan payments -- -- -- -- -- --
LIABILITIES
OUTSTANDING TRANSFERS (5,297) (856) 7,356 4,420 (500) 101
------------ ------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 9,171,038 $ 3,452,174 $ 1,420,351 $ 857,142 $ 2,751,504 $ 363,143
============ ============ ============ ============ ============ ============
<CAPTION>
Fidelity Financial
--------------------------------------------
Rio Common Money
Stock Market Disbursement Loan
Fund Fund Account Account Total
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT MARKET VALUE:
Magellan Fund $ -- $ -- $ -- $ -- $ 9,096,399
Balanced Fund -- -- -- -- 3,416,002
Managed Income Portfolio -- -- -- -- 1,410,085
Money Market Portfolio 38,875 18,054 59,866 -- 963,867
Market Index Fund -- -- -- -- 2,707,636
Intermediate Bond Fund -- -- -- -- 358,211
Rio Common Stock Fund 2,915,761 -- -- -- 2,915,761
Loan Account -- -- -- 945,471 945,471
------------ ------------ ------------ ------------ ------------
Total Investments 2,954,636 18,054 59,866 945,471 21,813,432
RECEIVABLES:
Receivables 176 -- (1,179) -- 184,168
Loan payments -- -- (8,649) 8,197 (452)
LIABILITIES
OUTSTANDING TRANSFERS 433 -- (6,633) 976 --
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 2,954,379 $ 18,054 $ 56,671 $ 952,692 $ 21,997,148
============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of this financial statement.
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<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
Fidelity Institutional
-------------------------------------------------------------------------------------
Managed Money Market Intermediate
Magellan Balanced Income Market Index Bond
Fund Fund Portfolio Portfolio Fund Fund
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
CONTRIBUTIONS:
Employer $ 1,621,429 $ 584,509 $ 273,072 $ 277,178 $ 819,665 $ 145,622
Employee 2,692,456 903,070 396,607 436,010 1,367,786 219,447
Rollover contributions 256,335 85,421 10,906 79,690 183,923 20,736
----------- ----------- ----------- ----------- ----------- -----------
Total contributions 4,570,220 1,573,000 680,585 792,878 2,371,374 385,805
INVESTMENT INCOME:
Realized gain (loss) 67,155 (289) -- -- 58,956 (5,713)
Unrealized gain (loss) 1,490,768 (295,731) -- -- 663,924 (19,935)
Interest and dividends 1,156,759 618,814 93,867 58,713 78,017 31,133
----------- ----------- ----------- ----------- ----------- -----------
Total net investment income 2,714,682 322,794 93,867 58,713 800,897 5,485
BENEFIT DISTRIBUTIONS 844,825 405,752 114,300 192,301 270,060 61,537
ADMINISTRATIVE EXPENSES 49,639 18,020 7,318 4,933 15,550 2,102
INTERFUND TRANSFERS 634,673 (387,978) (100,108) 81,810 25,367 (7,680)
----------- ----------- ----------- ----------- ----------- -----------
NET INCREASE 7,025,111 1,084,044 552,726 736,167 2,912,028 319,971
NET ASSETS AVAILABLE FOR
BENEFITS:
Beginning of year 9,171,038 3,452,174 1,420,351 857,142 2,751,504 363,143
----------- ----------- ----------- ----------- ----------- -----------
End of year $16,196,149 $ 4,536,218 $ 1,973,077 $ 1,593,309 $ 5,663,532 $ 683,114
=========== =========== =========== =========== =========== ===========
<CAPTION>
Fidelity Financial
-----------------------------------------
Harrah's Common Money
Stock Market Disbursement Loan
Fund Fund Account Account Total
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
CONTRIBUTIONS:
Employer $ 620,161 $ -- $ (57,313) $ -- $ 4,284,323
Employee 983,398 -- -- 6,998,774
Rollover contributions 164,151 -- -- -- 801,162
----------- ----------- ----------- ----------- -----------
Total contributions 1,767,710 -- (57,313) -- 12,084,259
INVESTMENT INCOME:
Realized gain (loss) 362,993 -- -- -- 483,102
Unrealized gain (loss) 1,787,543 -- -- 3,626,569
Interest and dividends 3,325 825 7,276 118,532 2,167,261
----------- ----------- ----------- ----------- -----------
Total net investment income 2,153,861 825 7,276 118,532 6,276,932
BENEFIT DISTRIBUTIONS 402,444 453 -- 65,040 2,356,712
ADMINISTRATIVE EXPENSES 17,683 84 -- -- 115,329
INTERFUND TRANSFERS (793,639) (257) 91,809 456,003 --
----------- ----------- ----------- ----------- -----------
NET INCREASE 2,707,805 31 41,772 509,495 15,889,150
NET ASSETS AVAILABLE FOR
BENEFITS:
Beginning of year 2,954,379 18,054 56,671 952,692 21,997,148
----------- ----------- ----------- ----------- -----------
End of year $ 5,662,184 $ 18,085 $ 98,443 $ 1,462,187 $37,886,298
=========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of this financial statement.
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<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. DESCRIPTION OF THE PLAN
The following description of the Rio Suite Hotel & Casino Employee Retirement
Savings Plan (the Plan) provides only general information. Participants should
refer to the Summary Plan Description for a more complete description of the
Plan's provisions.
GENERAL INFORMATION
The Plan is a voluntary, qualified, defined contribution plan covering
substantially all employees of the Rio Suite Hotel & Casino (the Company) who
have completed six months of service and have attained the age of twenty-one
prior to January 1, 1999. Subsequent to January 1, 1999, employees are eligible
to participate in the Plan after 90 days of service. Eligibility for Company
matching contributions begins on January 1 or July 1 following completion of one
year of service. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA). All investments are managed by
Fidelity Institutional Retirement Services Company. As of December 31, 1999,
Plan trustees were James A. Barrett, Jr. and Ronald J. Radcliffe.
As discussed in Note 7, the Company merged with Harrah's Entertainment Inc. and
HEI Acquisition Corp. III., effective January 1, 1999. In conjunction with the
merger, the Plan merged into the Harrah's Entertainment Savings and Retirement
Plan effective January 1, 2000.
COMPANY MERGER
Effective January 1, 1999, the Company was merged with Harrah's Entertainment,
Inc. As of that date the stock in the Rio Common Stock Fund was converted to the
common stock of Harrah's Entertainment, Inc.
ADMINISTRATION
The Plan is sponsored by the Company. Lebenson Actuarial Services, Inc. provides
recordkeeping for the Plan.
PARTICIPANTS' ACCOUNTS
Each participant's account is credited with the participant's contributions,
allocation of the Company's contributions and the proportionate allocation of
the Plan's earnings or losses. Forfeitures of terminated participants' nonvested
benefits are applied to reduce the Company's contributions to the Plan. The
benefit to which a participant is entitled is equal to the balance in the
participant's account less any non-vested matching employer contributions.
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<PAGE>
1. DESCRIPTION OF THE PLAN (CONTINUED)
CONTRIBUTIONS
Prior to January 1, 1999, the Company made matching contributions of 25% of
employee contributions, up to 6% of a participant's compensation. Effective
January 1, 1999, the Company increased its matching contribution to 100% of
employee contributions up to 6% of participant's compensation.
Participant contributions are limited to 1% to 15% of compensation. Participant
contributions were taken from before-tax compensation and, along with investment
earnings, are not part of a participant's annual taxable income until withdrawn
from the Plan.
VESTING
Participants are immediately 100% vested in their voluntary contributions plus
actual earnings thereon. A participant vests in the remaining balance at 40%
after two full years of service and in additional 20% increments until the
participant is 100% vested after five full years of credited service. Upon
death, a participant is automatically 100% vested.
PAYMENT OF BENEFITS
Upon termination of service, retirement, death or disability, a participant may
elect to receive the value of all vested benefits in the form of a joint and
survivor annuity, or, if not married, a life annuity, a lump-sum amount, or
monthly, quarterly, semi-annual or annual cash installments over a specified
period. If the value of a terminated participant vested benefit does not exceed
$5,000, the entire vested benefit will be paid in a single lump-sum.
EXCESS CONTRIBUTIONS
Included in net assets available for benefits at December 31, 1998 are excess
contributions of $16,434, which were refunded to participants before March 15,
1999.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The books and records of the Plan are maintained on an accrual basis.
INVESTMENTS
Investments are stated at their current market value measured by quoted market
prices in active markets. Investment income is recorded as earned on a daily
basis.
PLAN EXPENSES
Legal, trust management, administrative and accounting expenses are paid by the
trust fund to the extent not paid by the Company.
-8-
<PAGE>
3. INVESTMENTS
Participant contributions are invested in the following funds at the
participants' elections:
FIDELITY MAGELLAN FUND
The Magellan Fund seeks long-term capital appreciation by investing in common
stocks and convertible securities of both foreign and domestic companies.
FIDELITY BALANCED FUND
This fund seeks as much income as possible, consistent with preservation of
capital. Investments include common and preferred stocks and bonds.
FIDELITY MANAGED INCOME PORTFOLIO
This portfolio seeks preservation of capital and a competitive level of income
over time. This portfolio purchases short and long-term investment contracts
that meet the high credit quality standards of Fidelity Management Trust
Company. In addition, investments are made in money market instruments.
FIDELITY MONEY MARKET PORTFOLIO
This portfolio seeks as high a level of current income as is consistent with the
preservation of capital and liquidity. The yield will fluctuate with changes in
market conditions. Investments include short-term corporate obligations, U.S.
government obligations and certificates of deposit.
HARRAH'S COMMON STOCK FUND
This fund is invested by Fidelity Financial Group, Inc. (Fidelity) in Harrah's
Entertainment, Inc. common stock. Fidelity has discretion as to the timing and
manner of purchasing shares of common stock. Cash dividends or interest, if any,
are reinvested in this fund.
FIDELITY INTERMEDIATE BOND
This fund seeks high current income by investing mainly in investment-grade debt
securities while maintaining maturities of three to ten years. To achieve this
investment strategy, shareholders' investments are pooled and invested towards a
specific goal.
SPARTAN U.S. EQUITY INDEX FUND
This fund seeks a total return which corresponds to that of the Standard &
Poor's Composite Index of 500 Stocks. To achieve this investment strategy,
investments are made in the stocks which comprise the S&P Market Index.
4. PARTICIPANT LOANS
The Plan provides that participants are able to request loans for amounts equal
to as much as 50% of their account balances, subject to certain rules and
limitations specified in the Plan. Interest rates on participant loans
outstanding at December 31, 1999 vary from 8% to 11%.
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<PAGE>
5. TAX STATUS
The Plan obtained its last determination letter from the Internal Revenue
Service on January 26, 1995. At that time, the Plan was deemed to be designed to
satisfy the qualification requirements, and consequently the related trust
appeared to satisfy the tax exempt requirement of the Internal Revenue Code. The
Plan has been amended subsequently. The Plan administration and tax counsel
believe that the Plan is currently designed and being operated in compliance
with the qualification requirements of the Internal Revenue Code, and the
related trust was tax exempt as of the financial statement date.
6. VOLUNTARY COMPLIANCE RESOLUTION PROGRAM
During 1995, the Company discovered that there had been a discrepancy between
employee requested deferral amounts and actual deferrals for certain types of
non-regular payrolls relating to the three years ended December 31, 1994. The
Company engaged a firm with benefit plan expertise to determine the amount of
the under-withholding and submitted a plan for rectifying the discrepancy under
the Voluntary Compliance Resolution Program with the Internal Revenue Service.
In April 1997, the Company made an additional contribution to the Plan of
$106,830 in accordance with an agreement made under the Voluntary Compliance
Resolution Program with the Internal Revenue Service. The balance of $18,054 in
the VCR fund at December 31, 1999 and 1998 represented the amount due to
participants who terminated from the plan and have not been located to disburse
the funds. When the terminated participants are located, they will be paid out
of this fund.
7. SUBSEQUENT EVENT
As a result of a merger between Rio Hotel and Casino, Inc., Harrah's
Entertainment Inc. and HEI Acquisition Corp. III, effective January 1, 2000, the
Plan was merged into the Harrah's Entertainment, Inc. Savings and Retirement
Plan ("Harrah's Plan"). Approximately $36.3 million of assets were transferred
to the custodian of the Harrah's Plan, State Street Bank and Trust Company.
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<PAGE>
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD
FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1999 SCHEDULE I
(EIN: 88-0288115)
<TABLE>
<CAPTION>
DESCRIPTION OF MARKET
IDENTITY OF ISSUER INVESTMENT VALUE
------------------------------ --------------------------------------- -------------------
<S> <C> <C>
Fidelity Management Trust Co.* 1,976,942.880 units of Fidelity
Managed Income Portfolio $ 1,973,077
Harrah's Entertainment, Inc.* 214,391 shares of Harrah's
Entertainment, Inc. Common
Stock 5,662,184
Fidelity Management Trust Co.* 1,721.178 shares of Spartan U.S.
Equity Index Fund 89,656
Fidelity Management Trust Co.* 116,528 shares of Money Market 116,528
Portfolio
Participant Loans* 8%-11% 1,446,039
Other Pending Transfer to Harrah's
Savings and Retirement Plan 28,601,814
-------------------
Total $ 37,889,298
===================
</TABLE>
*Party-in-interest
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<PAGE>
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.
RIO SUITE HOTEL & CASINO
EMPLOYEE RETIREMENT SAVINGS PLAN
By: /s/ RONALD J. RADCLIFFE
----------------------------
Ronald J. Radcliffe, Trustee
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<PAGE>
EXHIBIT INDEX
Description
-----------
Consent of Independent Public Accountants
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