AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 11, 1995
REGISTRATION NUMBER 33-62783
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
HARRAH'S ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 7993 62-1411755
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or Classification Code Number) Identification Number)
organization) 1023 CHERRY ROAD
MEMPHIS, TENNESSEE 38117
(901) 762-8600
</TABLE>
HARRAH'S OPERATING COMPANY, INC.
(Exact name of registrant as specified in governing instruments)
<TABLE>
<S> <C> <C>
DELAWARE 7993 75-1941623
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or Classification Code Number) Identification Number)
organization) 1023 CHERRY ROAD
MEMPHIS, TENNESSEE 38117
(901) 762-8600
</TABLE>
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
-------------------
E. O. ROBINSON, JR., ESQ.
GENERAL COUNSEL
HARRAH'S ENTERTAINMENT, INC.
1023 CHERRY ROAD
MEMPHIS, TENNESSEE 38117
(901) 762-8600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
-------------------
COPY TO:
JOHN M. NEWELL, ESQ.
LATHAM & WATKINS
633 WEST FIFTH STREET, SUITE 4000
LOS ANGELES, CALIFORNIA 90071-2007
(213) 485-1234
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective as determined by
market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. X
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
================================================================================
<PAGE>
PROSPECTUS
$200,000,000
HARRAH'S ENTERTAINMENT, INC.
COMMON STOCK
HARRAH'S OPERATING COMPANY, INC.
DEBT SECURITIES
PREFERRED STOCK
Harrah's Entertainment, Inc., a Delaware corporation ("Harrah's
Entertainment"), may offer from time to time shares of its common stock, par
value $0.10 per share (the "Common Stock"), and its wholly-owned subsidiary,
Harrah's Operating Company, Inc., a Delaware corporation ("Harrah's Operating"),
may offer from time to time in one or more series (i) its debt securities
consisting of debentures, notes or other evidence of indebtedness (the "Debt
Securities") or (ii) shares of its preferred stock, par value $0.10 per share
(the "Preferred Stock"), in amounts as may be sold for an aggregate public
offering price of up to $200,000,000 on terms to be determined at the time of
the offering. At the option of Harrah's Operating, the Debt Securities may be
issued as senior secured Debt Securities, as senior unsecured Debt Securities,
as senior subordinated Debt Securities or as subordinated Debt Securities, and
in any combination thereof. The payment of principal and interest with respect
to the Debt Securities will be unconditionally guaranteed by Harrah's
Entertainment. See "Description of Debt Securities--Guarantee." With respect to
the Preferred Stock, the payment of dividends, if and to the extent declared out
of monies held by Harrah's Operating and legally available therefor, and
payments on liquidation or redemption will be guaranteed by Harrah's
Entertainment to the extent described herein. See "Description of Preferred
Stock--Guarantee." The Common Stock, Debt Securities and Preferred Stock
(collectively, the "Securities") may be offered separately or together, in
separate series, in amounts, at prices and on terms determined by market
conditions at the time of sale and to be set forth in one or more supplements to
this Prospectus (each, a "Prospectus Supplement").
The specific terms of the Securities for which this Prospectus is being
delivered will be set forth in the applicable Prospectus Supplement which will
include, where applicable: (i) in the case of Common Stock, any initial public
offering price; (ii) in the case of Debt Securities, the specific title,
aggregate principal amount, form (which may be certificated or global),
authorized denominations, maturity (which may be fixed or extendible), interest
rate or rates (which may be fixed or variable) (or manner of calculation
thereof), if any, the time of payment of interest, if any, any terms of
redemption at the option of Harrah's Operating or repayment at the option of the
holder, any terms for sinking fund payments, additional covenants, initial
public offering price, purchase price and other terms with respect to the Debt
Securities; and (iii) in the case of Preferred Stock, the specific designation
and stated value per share, any dividend, liquidation, redemption, voting and
other rights, the terms of Harrah's Entertainment's guarantee and any initial
public offering price. The Debt Securities may be issued as Original Issue
Discount Securities to be sold at a substantial discount below their principal
amount and, if issued, certain terms thereof will be set forth in the Prospectus
Supplement related thereto. See "Description of Debt Securities."
The applicable Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations
relating to, and any listing on a securities exchange of, the Securities covered
by such Prospectus Supplement.
------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------------------------------
NO GAMING REGULATORY AUTHORITY HAS PASSED
UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS.
----------------------------------------------------
The Securities may be offered directly to one or more purchasers, through
agents designated from time to time by the offeror or to or through underwriters
or dealers. If any agents or underwriters are involved in the sale of the
Securities, their names, and any applicable purchase price, fee, commission or
discount arrangement between or among them, will be set forth, or will be
calculable from the information set forth, in the applicable Prospectus
Supplement. See "Plan of Distribution." No Securities may be sold without
delivery of a Prospectus Supplement describing the method and terms of the
offering of such Securities.
------------
THE DATE OF THIS PROSPECTUS IS OCTOBER 11, 1995
<PAGE>
AVAILABLE INFORMATION
Harrah's Entertainment and Harrah's Operating have filed with the Securities
and Exchange Commission (the "Commission") a Registration Statement on Form S-3
under the Securities Act of 1933, as amended (the "Securities Act"), for the
registration of the Securities offered hereby. This Prospectus, which
constitutes a part of the Registration Statement, does not contain all of the
information set forth in the Registration Statement, certain items of which are
contained in exhibits and schedules to, or incorporated by reference in, the
Registration Statement as permitted by the rules and regulations of the
Commission. For further information with respect to Harrah's Entertainment and
Harrah's Operating and the Securities offered hereby, reference is made to the
Registration Statement, including the exhibits thereto, and financial statements
and notes filed as a part thereof or incorporated by reference therein.
Statements made in this Prospectus concerning the contents of any document
referred to herein are not necessarily complete. With respect to each such
document filed with the Commission as an exhibit to, or incorporated by
reference in, the Registration Statement, reference is made to the exhibit for a
more complete description of the matter involved, and each such statement shall
be deemed qualified in its entirety by such reference.
Harrah's Entertainment and Harrah's Operating are subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). In accordance therewith, Harrah's Entertainment files
consolidated reports, proxy statements and other information with the
Commission. Reports, proxy statements and other information filed by Harrah's
Entertainment may be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the Commission's Regional Offices located at 500 West Madison Street,
Suite 1400, Chicago, Illinois 60606, and 7 World Trade Center, 13th Floor, New
York, New York 10048. Copies of such material may be obtained by mail from the
Public Reference Branch of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, at prescribed rates. In addition, such material may also be
inspected and copied at the offices of the New York, Midwest, Pacific and
Philadelphia Stock Exchanges, on which exchanges the Common Stock of Harrah's
Entertainment is listed.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents have been filed with the Commission and are
incorporated by reference in this Prospectus: (i) Annual Report on Form 10-K of
The Promus Companies Incorporated ("Promus") (File No. 1-10410), and Promus's
Amended Annual Report on Form 10-K/A, for the year ended December 31, 1994
(collectively, the "1994 Harrah's Entertainment Form 10-K/A"), (ii) Promus's
Quarterly Report on Form 10-Q for the period ended March 31, 1995, (iii) Form
8-K of Promus, filed with the Commission on May 19, 1995, (iv) Form 8-K of
Promus, filed with the Commission on May 31, 1995, (v) Form 8-K of Promus, filed
with the Commission on June 15, 1995, (vi) Harrah's Entertainment's Quarterly
Report on Form 10-Q for the period ended June 30, 1995, (vii) Form 8-K of
Harrah's Entertainment, filed with the Commission on July 7, 1995 and (viii) the
section entitled "Description of Promus--Description of Promus Capital Stock" in
the Proxy Statement, dated December 13, 1989, of Holiday Corporation. All
documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus and prior to the termination
of the offering of the Securities shall be deemed to be incorporated herein by
reference and to be a part hereof from the respective dates of filing of such
documents.
Any statement contained in a document incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein, or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
2
<PAGE>
Copies of all documents which are incorporated herein by reference (not
including the exhibits to such information, unless such exhibits are
specifically incorporated by reference in such information) will be provided
without charge to each person, including any beneficial owner, to whom this
Prospectus is delivered, upon written or oral request. Copies of this
Prospectus, as amended or supplemented from time to time, and any other
documents (or parts of documents) that constitute part of the Prospectus under
Section 10(a) of the Securities Act will also be provided without charge to each
such person, upon written or oral request. Requests should be directed to
Harrah's Entertainment, Inc., at its principal executive offices at 1023 Cherry
Road, Memphis, Tennessee 38117, Attention, Corporate Secretary, (901) 762-8600.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE SECURITIES AT
LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE CHICAGO STOCK EXCHANGE, THE NEW YORK STOCK
EXCHANGE, THE PACIFIC STOCK EXCHANGE AND THE PHILADELPHIA STOCK EXCHANGE (IN THE
CASE OF COMMON STOCK), IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
3
<PAGE>
THE COMPANY
The Company is one of the leading casino entertainment companies in the
United States. Until June 1995, Harrah's Entertainment existed under the name
"The Promus Companies Incorporated." As part of the spin-off by Promus of its
hotel business, Promus Hotel Corporation, on June 30, 1995, Promus changed its
name to Harrah's Entertainment, Inc., and Promus's wholly-owned subsidiary,
Embassy Suites, Inc., changed its name to Harrah's Operating Company, Inc.
Harrah's Entertainment is a holding company, the principal asset of which is the
capital stock of Harrah's Operating. Harrah's Operating directly owns certain of
the assets and directly and indirectly owns the stock of certain subsidiaries
which operate the Company's business. Unless the context otherwise requires, the
"Company" refers to Harrah's Entertainment, Inc., together with its
subsidiaries, "Harrah's Entertainment" refers to Harrah's Entertainment, Inc.,
and "Harrah's Operating" refers to Harrah's Operating Company, Inc. The
principal executive offices of Harrah's Entertainment and Harrah's Operating are
located at 1023 Cherry Road, Memphis, Tennessee 38117, telephone (901) 762-8600.
The Company has, through existing and predecessor entities, been in the
casino entertainment business for more than 57 years and is unique among casino
entertainment companies in its broad geographic diversification. The Company
operates casino hotels in the five traditional U.S. gaming markets of Reno, Lake
Tahoe, Las Vegas and Laughlin, Nevada and Atlantic City, New Jersey. The Company
also operates a temporary land-based casino in New Orleans, Louisiana; riverboat
casinos in Joliet, Illinois; dockside casinos in Vicksburg and Tunica,
Mississippi, Shreveport, Louisiana and North Kansas City, Missouri; limited
stakes casinos in Central City and Black Hawk, Colorado; and a casino on an
Indian reservation near Phoenix, Arizona. The Company also has under development
a permanent land-based casino in New Orleans, Louisiana (under development by a
partnership in which the Company is a general partner) to replace the existing
temporary casino in that city, a land-based casino in Auckland, New Zealand
under development by a company in which the Company owns an interest, a
riverboat casino in Maryland Heights (near St. Louis), Missouri, and a casino on
an Indian reservation in the State of Washington. The Company also owns a 13.8%
interest in Sodak Gaming, Inc., a leading distributor of electronic gaming
machines and gaming-related products and systems, and a 75% interest in a
partnership that owns the approximately 52-acre Station Square site across from
the Golden Triangle in Pittsburgh, on which the partnership plans to develop a
casino entertainment facility if casino gaming is legalized in that
jurisdiction. As of June 30, 1995, the Company operated a total of approximately
600,000 square feet of casino space, 18,200 slot machines, 875 table games,
5,345 hotel rooms or suites, approximately 76,000 square feet of convention
space, 48 restaurants, five showrooms and four cabarets, at casino facilities
which are wholly owned by the Company, partially owned by the Company, or owned
by a third party and managed by the Company.
RATIO OF EARNINGS TO FIXED CHARGES
The following are the consolidated ratios of earnings to fixed charges for
the Company for the six months ended June 30, 1995 and each of the fiscal years
1994, 1993, 1992, 1991 and 1990.
SIX MONTHS ENDED
JUNE 30, 1995 1994 1993 1992 1991 1990
---------------- ---- ---- ---- ---- ----
1.8 2.0 2.6 2.0 1.6 1.5
For purposes of computing this ratio, earnings consist of income before
income taxes plus fixed charges (excluding capitalized interest) and minority
interests (relating to subsidiaries whose fixed charges are included in the
computation), excluding equity in undistributed earnings of less than 50% owned
investments. Fixed charges include interest whether expensed or capitalized,
amortization of debt expense, discount or premium related to indebtedness and
such portion of rental expense deemed by the Company to be representative of
interest. Where applicable, both earnings and fixed charges
4
<PAGE>
have been adjusted to include 100% of the financial results of the Company's
nonconsolidated, majority-owned subsidiary.
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the Securities
for general corporate purposes, including acquisitions, capital expenditures and
working capital requirements; to repay, redeem or repurchase outstanding
indebtedness; or for such other purposes as may be specified in the Prospectus
Supplement. A description of any indebtedness to be refinanced with the proceeds
of the Debt Securities will be set forth in the applicable Prospectus
Supplement.
DESCRIPTION OF COMMON STOCK
The description of the Common Stock set forth below does not purport to be
complete and is qualified in its entirety by reference to Harrah's
Entertainment's Certificate of Incorporation (the "Harrah's Entertainment
Certificate") and Bylaws (the "Harrah's Entertainment Bylaws").
GENERAL
The Harrah's Entertainment Certificate authorizes the issuance of up to
360,000,000 shares of Common Stock with a par value of $0.10 per share. On July
31, 1995, Harrah's Entertainment had 102,586,669 shares of Common Stock issued
and outstanding. In addition, Harrah's Entertainment has reserved for issuance
under its 1990 Stock Option Plan and 1990 Restricted Stock Plan an aggregate of
9,954,562 shares of Common Stock.
Subject to the limitations contained in the Company's debt instruments and
after provision for the payment of dividends on any series of preferred stock
which might be issued and which has a preference with respect to the payment of
dividends, holders of Common Stock are entitled to receive such dividends as may
be declared by the Board of Directors of Harrah's Entertainment out of funds
legally available for such purpose.
The holders of shares of Common Stock are entitled in the event of any
liquidation, dissolution or winding up of the affairs of Harrah's Entertainment
to share pro rata in all lawful distributions of the remaining assets of
Harrah's Entertainment.
The holders of Common Stock will be entitled to one vote per share.
Stockholders are not entitled to cumulative voting rights in the election of
directors.
All shares of Common Stock now outstanding are, and additional shares of
Common Stock offered will be when issued, fully paid and non-assessable. The
Common Stock has no conversion rights. No holder of Common Stock has any
preemptive right to subscribe for any stock or other securities of Harrah's
Entertainment which may be issued.
REDEMPTION
The Common Stock can be redeemed by Harrah's Entertainment if, among other
circumstances, in the judgment of the Board of Directors such redemption is
necessary to avoid any regulatory sanctions against, or to prevent the loss of,
or to secure the reinstatement of, any license, franchise or entitlement from
any governmental agency held by Harrah's Entertainment, any affiliate of
Harrah's Entertainment, or any entity in which Harrah's Entertainment or an
affiliate is an owner, which license, franchise or entitlement is needed to
conduct any portion of the business of Harrah's Entertainment, any such
affiliate or other entity or which license, franchise or entitlement is
conditioned upon some or all of the holders of Common Stock possessing
prescribed qualifications.
5
<PAGE>
RIGHTS AND SPECIAL STOCK
Harrah's Entertainment currently has 5,000,000 authorized shares of special
stock, par value $1.12 1/2 per share ("Special Stock"). The Board of Directors
has the authority, without further action by stockholders, to determine the
rights, preferences and privileges of the unissued Special Stock. Provisions
could be included in the shares of Special Stock, such as extraordinary voting,
dividend, redemption or conversion rights, which could discourage an unsolicited
tender offer or takeover proposal.
Attached to each share of Common Stock is one-third of a right ("Right")
entitling the registered holder to purchase from Harrah's Entertainment, for
each whole Right, one two-hundredth of a share (a "Unit") of Series B Special
Stock, par value $1.12 1/2 per share (the "Series B Stock") at a purchase price
of $125.00 per unit (the "Purchase Price"), subject to adjustment. The Purchase
Price shall be paid in cash or by certified bank check or bank draft payable to
the order of Harrah's Entertainment. The description and terms of the Rights are
set forth in a Rights Agreement (the "Rights Agreement") between Harrah's
Entertainment and The Bank of New York, as rights agent.
Rights are attached to all Common Stock certificates representing
outstanding shares. The Rights detach from the Common Stock and are distributed
to holders of Common Stock upon a date (the "Rights Distribution Date") which is
the earlier of (i) ten days following a public announcement that a person or
group of affiliated or associated persons (an "Acquiring Person") has acquired
or obtained the right to acquire, beneficial ownership of 20% or more of the
outstanding shares of Common Stock ("the Stock Acquisition Date"), or (ii) ten
business days following the commencement of a tender offer or exchange offer
that would result in a person or group beneficially owning 30% or more of such
outstanding shares of Common Stock. The Board of Directors may postpone such
Rights Distribution Date beyond the earlier of the dates set forth in the
preceding sentence upon the vote of a majority of the directors who are not
Acquiring Persons or affiliated or associated with an Acquiring Person (the
"Continuing Directors"). Until the Rights Distribution Date (or earlier
redemption or expiration of the Rights), (i) the Rights are evidenced by the
Common Stock certificates and are transferred with and only with such
certificates, (ii) new Common Stock certificates will contain a notation
incorporating the Rights Agreement by reference, (iii) the surrender for
transfer of any certificates for Common Stock outstanding will also constitute
the transfer of the Rights associated with the shares represented by such
certificates, and (iv) Rights shall be issued in respect of all shares of Common
Stock which are issued after the Distribution. Except as otherwise determined by
the Board of Directors, only shares of Common Stock issued prior to the
Distribution Date will be issued with Rights.
The Rights are not exercisable until the Rights Distribution Date and expire
at the close of business on October 5, 1996, unless earlier redeemed by Harrah's
Entertainment as described below or upon the occurrence of certain merger or
other acquisition transactions approved by the Board of Directors. As soon as
practicable after the Rights Distribution Date, Rights Certificates will be
mailed to holders of record of shares of Common Stock as of the close of
business on the Rights Distribution Date and, thereafter, the separate Rights
Certificate alone will represent the Rights.
In the event that, at any time following the Rights Distribution Date, (i)
Harrah's Entertainment is the surviving corporation in a merger with an
Acquiring Person and its Common Stock is not changed or exchanged or (ii) an
Acquiring Person becomes the beneficial owner of more than 20% of the then
outstanding shares of Common Stock (except pursuant to an offer for all
outstanding shares of Common Stock which a majority of the Continuing Directors
determine to be fair to and otherwise in the best interests of stockholders),
each holder of a Right will thereafter have the right to receive, upon exercise,
Common Stock (or, in certain circumstances, cash, property or other securities
of Harrah's Entertainment) having a value equal to two times the exercise price
of the Right. Notwithstanding any of the foregoing, following the occurrence of
any of the events set forth in this paragraph, all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were, beneficially
owned by any Acquiring Person will be null and void. However, Rights are not
exercisable following the occurrence of
6
<PAGE>
any of the events set forth above until such time as the Rights are no longer
redeemable by Harrah's Entertainment as set forth below.
For example, at an exercise price of $125.00 per Right, each Right not owned
by an Acquiring Person (or by certain related parties) following an event set
forth in the preceding paragraph would entitle its holder to purchase $250.00
worth of Common Stock (or other consideration, as noted above) for $125.00.
Assuming that the Common Stock had a per share value of $25.00 at such time, the
holder of each valid Right would be entitled to purchase 10 shares of Common
Stock for $125.00.
In the event that, at any time following the Stock Acquisition Date, (i)
Harrah's Entertainment is acquired in a merger or other business combination
transaction in which Harrah's Entertainment is not the surviving corporation or
Common Stock is changed into or exchanged for securities of any other person,
cash or other property (other than a merger which follows an offer described in
clause (ii) of the second preceding paragraph), or (iii) 50% or more of Harrah's
Entertainment's assets or earning power is sold or transferred, each holder of a
Right (except Rights which previously have been voided as set forth above) shall
thereafter have the right to receive, upon exercise, common stock of the
acquiring or surviving company having a value equal to two times the exercise
price of the Right. The events set forth in this paragraph and in the second
preceding paragraph are referred to as the "Triggering Events."
The Purchase Price payable, and the number of Units or other securities or
property issuable, upon exercise of Rights are subject to adjustment from time
to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Series B Stock, (ii) if
holders of the Series B Stock are granted certain rights or warrants to
subscribe for Series B Stock or convertible securities at less than the current
market price of the Series B Stock, or (iii) upon the distribution to holders of
the Series B Stock of evidences of indebtedness or assets (excluding regular
quarterly cash dividends) or of subscription rights or warrants (other than
those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least 1% of the Purchase
Price. In addition, to the extent that Harrah's Entertainment does not have
sufficient shares of Common Stock issuable upon exercise of the Rights following
the occurrence of a Triggering Event, Harrah's Entertainment may, under certain
circumstances, reduce the Purchase Price. No fractional Units will be issued
and, in lieu thereof, an adjustment in cash will be made based on the market
price of the Series B Stock on the last trading day prior to the date of
exercise.
At any time until ten days following the Stock Acquisition Date, Harrah's
Entertainment may redeem the Rights in whole, but not in part, at a price of
$0.05 per Right, as such redemption price may be adjusted pursuant to the Rights
Agreement. As long as the Rights are redeemable, a majority of the Continuing
Directors of Harrah's Entertainment may extend the period for redemption. After
the redemption period has expired, Harrah's Entertainment's rights of redemption
may be reinstated if an Acquiring Person reduces his beneficial ownership to 10%
or less of the outstanding shares of Common Stock in a transaction or series of
transactions not involving Harrah's Entertainment. Immediately upon the action
of the Board of Directors ordering redemption of the Rights, the Rights will
terminate and the only right of the holders of Rights will be to receive the
$0.05 redemption price (as adjusted) per Right.
Until a Right is exercised, the holder thereof, as such, will have no rights
as a stockholder of Harrah's Entertainment, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights will
not be taxable to Harrah's Entertainment or the holders of Common Stock, such
holders may, depending upon the circumstances, recognize taxable income in the
event that the Rights become exercisable for Common Stock (or other
consideration) or for common stock of the acquiring company as set forth above.
7
<PAGE>
DESCRIPTION OF THE DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent to which such general
provisions may apply to the Debt Securities will be described in a Prospectus
Supplement relating to such Debt Securities.
The Debt Securities may constitute either senior secured debt ("Senior
Secured Debt Securities"), senior unsecured debt ("Senior Unsecured Debt
Securities"), senior subordinated debt ("Senior Subordinated Debt Securities")
or subordinated debt ("Subordinated Debt Securities"), or any combination
thereof, of Harrah's Operating. Each such class of Debt Securities will be
issued under a separate indenture (the "Senior Secured Debt Indenture," the
"Senior Unsecured Debt Indenture," the "Senior Subordinated Debt Indenture," and
the "Subordinated Debt Indenture," respectively), between Harrah's Operating, as
obligor, Harrah's Entertainment, as guarantor, and one or more trustees (the
"Trustee"). The Senior Secured Debt Indenture, the Senior Unsecured Debt
Indenture, the Senior Subordinated Debt Indenture and the Subordinated Debt
Indenture are sometimes hereinafter referred to individually as an "Indenture"
and collectively as the "Indentures."
The terms of the Debt Securities include those stated in the applicable
Indenture and those made part of such Indenture by reference to the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and holders of
the Debt Securities are referred to the Indentures and the Trust Indenture Act
for a statement thereof. A copy of the form of each Indenture is filed as an
exhibit to the Registration Statement of which this Prospectus is a part. The
following summaries of certain provisions of the Debt Securities and the
Indentures, while including a discussion of all material aspects or features
thereof, do not purport to be complete and are subject to, and are qualified in
their entirety by reference to, all the provisions of the Debt Securities and
the Indentures, including the definitions therein of certain terms which are not
otherwise defined in this Prospectus. Wherever particular provisions or defined
terms of the Indentures are referred to, such provisions or defined terms are
incorporated herein by reference.
GENERAL
The Indentures will not limit the aggregate principal amount of Debt
Securities which may be issued thereunder. Debt Securities may be issued
thereunder from time to time as a single series or in two or more separate
series up to the aggregate principal amount from time to time authorized by
Harrah's Operating for each series. As of the date of this Prospectus, Harrah's
Operating has authorized the issuance under the Indentures of up to $200 million
aggregate principal amount of the Debt Securities. The Debt Securities will be
secured senior, unsecured senior, senior subordinated or subordinated
obligations or any combination thereof of Harrah's Operating.
The applicable Prospectus Supplement or Prospectus Supplements will
describe, among other things, the following terms of the Debt Securities, if
applicable to such Debt Securities: (i) the title of the Debt Securities; (ii)
any limit on the aggregate principal amount of the Debt Securities and whether
they will constitute senior secured, senior unsecured, senior subordinated or
subordinated Debt Securities; (iii) the price or prices (expressed as a
percentage of the aggregate principal amount thereof) at which the Debt
Securities will be issued; (iv) the date or dates on which the principal of the
Debt Securities is payable or the method of determination thereof; (v) the rate
or rates (which may be fixed or variable) at which the Debt Securities will bear
interest (which rate may be zero in the case of certain Debt Securities issued
at an issue price representing a discount from the principal amount payable at
maturity), and the date or dates from which such interest, if any, will accrue,
and the circumstances, if any, in which Harrah's Operating may defer interest
payments; (vi) the Interest Payment Dates, if any, on which any interest on the
Debt Securities will be payable, and the Regular Record Date for any
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interest payable on any Debt Securities; (vii) the right or obligation, if any,
of the Company to redeem or purchase Debt Securities pursuant to any sinking
fund or analogous provisions or at the options of a holder thereof, or
otherwise, the conditions, if any, giving rise to such right or obligation, and
the period or periods within which, and the price or prices at which and the
terms and conditions upon which Debt Securities shall be redeemed or purchased,
in whole or part, and any provisions for the marketing of such Debt Securities;
(viii) if the amount of payments of principal of, premium, if any, and interest,
if any, on the Debt Securities is to be determined by reference to an index,
formula or other method, the manner in which such amounts are to be determined
and the calculation agent, if any, with respect thereto; (ix) if other than the
principal amount thereof, the portion of the principal amount of the Debt
Securities which will be payable upon declaration or acceleration of the
Maturity thereof pursuant to an Event of Default; (x) whether the Debt
Securities will be issued in certificated or book-entry form and, if so, the
identity of the depository for the Debt Securities; (xi) any listing of the Debt
Securities on a securities exchange; (xii) any additional restrictive covenants
included for the benefit of Holders of such Debt Securities; (xiii) any
additional events of default provided with respect to such Debt Securities; and
(xiv) any other material terms of the Debt Securities. Any such Prospectus
Supplement will also describe any special provisions for the payment of
additional amounts with respect to the Debt Securities.
Harrah's Operating is dependent on the receipt of dividends or other
payments from its subsidiaries to make payments on interest and principal on the
Debt Securities. Neither the Indentures nor any other material contract
restricts subsidiaries of Harrah's Operating from making dividends or
distributions to Harrah's Operating.
GAMING REGULATION
The casino entertainment operations of the Company are subject to extensive
regulation by federal, state and local authorities in several jurisdictions. See
"Business and Properties -- Governmental Regulation" in the 1994 Harrah's
Entertainment Form 10-K/A, incorporated by reference herein. The Indentures
provide that if a Holder or a beneficial owner of Debt Securities is required to
qualify under the gaming laws of any jurisdiction to which Harrah's Operating or
Harrah's Entertainment or any of their Subsidiaries is subject and does not so
qualify, such Holder must dispose of his interest in the Debt Securities within
30 days after receipt of notice of failure so to qualify or such earlier date
prescribed by the Gaming Authorities, or the Company will have the right to
redeem such Debt Securities. The Indentures will require the Trustee to report
the names of the record Holders of the Debt Securities to any gaming authority
when required by law.
GUARANTEE
Harrah's Entertainment irrevocably and unconditionally will guarantee the
payment of all obligations of Harrah's Operating under the Debt Securities.
Rights of Holders pursuant to such Guarantee of the Senior Subordinated Debt
Securities and the Subordinated Debt Securities will be subordinate to the
rights of holders of the Senior Debt of Harrah's Entertainment to payment in
full in the same manner as the rights of Holders of the Senior Subordinated Debt
Securities and the Subordinated Debt Securities, respectively, are subordinate
to those of the Senior Debt of Harrah's Operating. Subject to the subordination
provisions of the Senior Subordinated Debt Indenture and the Subordinated Debt
Indenture (in the case of the Senior Subordinated Debt Securities and the
Subordinated Debt Securities, respectively), if Harrah's Operating defaults in
the payment of the principal of, premium, if any, or interest on such Debt
Securities when and as the same shall become due, whether upon maturity,
acceleration, call for redemption or otherwise, without the necessity of action
by the Trustee or any Holder of such Debt Securities, Harrah's Entertainment
shall be required promptly and fully to make such payment. The Indentures
provide for the release of the Guarantor in certain circumstances, including (i)
Harrah's Operating ceases to be a wholly owned Subsidiary of Harrah's
Entertainment, or
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(ii) a transfer by Harrah's Operating of all or substantially all of its assets
or a merger of Harrah's Operating which transfer or merger is governed by the
"Limitation on Merger, Sale or Consolidation" covenant, and in connection with
which the transferee entity assumes Harrah's Operating's obligations under the
Indentures and such transfer or merger otherwise complies with the requirements
of such covenant.
Harrah's Entertainment conducts substantially all of its business through
Harrah's Operating and its subsidiaries and does not own any material assets
other than all of the stock of Harrah's Operating. Harrah's Entertainment's
obligations under the Guarantee are as a secondary obligor, and such obligations
are subordinated to all present and future Senior Debt of Harrah's
Entertainment, as described above. Harrah's Entertainment is presently dependent
on the receipt of dividends or other payments from Harrah's Operating to make
payments on the Guarantee of the Debt Securities.
SUBORDINATION
The indebtedness evidenced by the Senior Subordinated Debt Securities and
the Subordinated Debt Securities (including principal, premium, if any, and
interest) will be subordinated in right of payment, as set forth in the
applicable Indentures, to the rights of holders of all Senior Debt of Harrah's
Operating to prior payment in full, whether outstanding on the date of such
Indentures or thereafter created, incurred, assumed or guaranteed.
As of June 30, 1995, the amount of outstanding Senior Debt of Harrah's
Operating was $460.4 million and the amount of outstanding Senior Debt of
Harrah's Entertainment was $429.2 million (which amounts include $305.0 million
of debt incurred by Harrah's Operating's subsidiaries and guaranteed by Harrah's
Entertainment and Harrah's Operating).
The Senior Subordinated Debt Indenture and Subordinated Debt Indenture
provide that no payment may be made on account of principal of, premium, if any,
or interest on the Senior Subordinated Debt Securities and the Subordinated Debt
Securities, respectively, by Harrah's Operating (or with respect to the
Guarantees thereof in the case of Harrah's Entertainment), or to acquire any of
such Debt Securities (pursuant to such Guarantees in the case of Harrah's
Entertainment), for cash or property (other than Capital Stock of Harrah's
Operating, or Harrah's Entertainment with respect to such Guarantees), or on
account of the redemption provisions of such Debt Securities by Harrah's
Operating (or with respect to such Guarantees in the case of Harrah's
Entertainment), (i) upon the maturity of any Senior Debt by lapse of time,
acceleration or otherwise, unless and until all principal of and interest on
such Senior Debt and all other obligations in respect thereof are first paid in
full in cash or cash equivalents or such payment duly is provided for, or (ii)
in the event of default in the payment of any principal of, premium, if any, or
interest on any Senior Debt when it becomes due and payable, whether at maturity
or at a date fixed for prepayment or by declaration or otherwise, unless and
until such payment default has been cured or waived or otherwise has ceased to
exist.
Upon the happening of a default (any event that, after notice or passage of
time would be an event of default) or an event of default (any event that
permits the holders of Senior Debt or their representative immediately to
accelerate its maturity) with respect to any Senior Debt, other than a default
in payment of the principal of, premium, if any, or interest on the Senior Debt,
or if an event of default would result upon any payment with respect to the
Senior Subordinated Debt Securities or the Subordinated Debt Securities (or
pursuant to the Guarantees thereof with respect to Harrah's Entertainment), upon
written notice of (i) the default given to Harrah's Operating, Harrah's
Entertainment and the applicable Trustee by the holders of a majority of the
principal amount outstanding of the Designated Senior Debt or their
representative, or (ii) the event of default given to Harrah's Operating,
Harrah's Entertainment and such Trustee by the holders of a majority of the
principal amount outstanding of the Designated Senior Debt or their
representative, or by any holder of Senior Debt or its representative after such
time as there is no Designated Senior Debt, then, unless and until such default
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or event of default has been cured or waived or otherwise has ceased to exist,
no payment may be made by Harrah's Operating with respect to the principal of or
premium, if any, or interest on such Debt Securities in cash or property (or
pursuant to such Guarantees with respect to Harrah's Entertainment), or to
acquire or repurchase any of such Debt Securities for cash or property (other
than Capital Stock of Harrah's Operating, or Harrah's Entertainment pursuant to
such Guarantees), or on account of the redemption provisions of such Debt
Securities (or pursuant to such Guarantees with respect to Harrah's
Entertainment). Notwithstanding the foregoing, unless the Senior Debt in respect
of which such default or event of default exists has been declared due and
payable in its entirety, in the case of a default within 30 days and, in the
case of an event of default, within 180 days after the date written notice of
such default, or event of default is delivered as set forth above (the "Payment
Blockage Period"), and such declaration has not been rescinded, Harrah's
Operating (and Harrah's Entertainment, with respect to such Guarantees) is
required then to pay all sums not paid to the Holders of such Senior
Subordinated Debt Securities or Subordinated Debt Securities during the Payment
Blockage Period due to the foregoing prohibitions and to resume all other
payments as and when due on such Debt Securities. Any number of such notices may
be given; provided, however, that (i) during any 360 consecutive days, the
aggregate of all Payment Blockage Periods shall not exceed 180 days, (ii) there
shall be a period of at least 180 consecutive days in each 360-day period when
no Payment Blockage Period is in effect, and (iii) any default or event of
default that resulted in the commencement of a 180-day period may not be the
basis for the commencement of any other 180-day period.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of Harrah's Operating, whether in cash, property or
securities (other than Capital Stock of Harrah's Operating), shall be received
by the applicable Trustee or the Holders of the Senior Subordinated Debt
Securities or the Subordinated Debt Securities before all Senior Debt is paid in
full, such payment or distribution shall be held in trust for the benefit of the
holders of, and shall be paid or delivered by such Trustee or such Holders, as
the case may be, to the holders of the Senior Debt remaining unpaid or
unprovided for or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any or
such Senior Debt may have been issued, ratably according to the aggregate
amounts remaining unpaid on account of the Senior Debt held or represented by
each, for application to the payment of all Senior Debt remaining unpaid, to the
extent necessary to pay all Senior Debt in full after giving effect to any
concurrent payment or distribution to the holders of such Senior Debt.
Upon any distribution of assets of Harrah's Operating (or Harrah's
Entertainment with respect to the Guarantees of the Senior Subordinated Debt
Securities and the Subordinated Debt Securities) upon any dissolution, winding
up, total or partial liquidation or reorganization or readjustment of Harrah's
Operating or Harrah's Entertainment, as applicable, whether voluntary or
involuntary, in bankruptcy, insolvency, receivership or a similar proceeding or
upon assignment for the benefit of creditors, or any other marshaling of the
assets and liabilities of Harrah's Operating or otherwise, (i) the holders of
all Senior Debt would first be entitled to receive payment in full in cash or
cash equivalents before the Holders of such Senior Subordinated Debt Securities
and Subordinated Debt Securities would be entitled to receive any payment on
account of the principal of, premium, if any, and interest on such Debt
Securities or in respect of the Redemption Price and (ii) any payment or
distribution of assets of Harrah's Operating (or Harrah's Entertainment, as
applicable), of any kind or character, whether in cash, property or securities
(other than Capital Stock), to which such Holders or the Trustee on behalf of
such Holders would be entitled, except for the subordination provisions
contained in the applicable Indenture, would be paid by the liquidating trustee
or agent or other person making such a payment of distribution directly to the
holders of Senior Debt to the extent necessary to make payment in full of all
Senior Debt remaining unpaid, after giving effect to any concurrent payment or
distribution to the holders of such Senior Debt.
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No provision contained in the Indentures or the Debt Securities will affect
the obligation of Harrah's Operating (and Harrah's Entertainment with respect to
the Guarantees of the Debt Securities), which is absolute and unconditional, to
pay, when due, principal of, premium, if any, and interest on the Debt
Securities, subject to a redemption required by applicable gaming laws as
specified above. See "--Gaming Regulation." The subordination provisions of the
Senior Subordinated Debt Securities and the Subordinated Debt Securities and any
Indenture governing same would not prevent the occurrence of any Event of
Default under the applicable Indenture or limit the rights of the Trustee under
such Indenture or any Holder of such Debt Securities to pursue any other rights
or remedies with respect to the respective Debt Securities.
Because the Debt Securities will not be guaranteed by any of Harrah's
Operating's Subsidiaries, the Debt Securities (and the Guarantees thereof, in
the case of Harrah's Entertainment) also effectively will be subordinated by
operation of law to all liabilities, including trade payables and capitalized
lease obligations, if any, of Harrah's Operating's Subsidiaries (and, with
respect to Harrah's Entertainment, Harrah's Entertainment's Subsidiaries). Any
right of Harrah's Operating or Harrah's Entertainment to receive the assets of
any of their Subsidiaries upon such Subsidiary's liquidation or reorganization
(and the consequent right of the Holders of such Debt Securities to participate
in those assets) effectively will be subordinated to the claims of any such
Subsidiary's creditors (including trade creditors), except to the extent that
Harrah's Operating (or Harrah's Entertainment, as applicable) is itself
recognized as a creditor of such Subsidiary, in which case the claims of
Harrah's Operating (or Harrah's Entertainment, as applicable) would still be
subordinate to any indebtedness of such Subsidiary senior to that held by
Harrah's Operating (or Harrah's Entertainment, as applicable). As of June 30,
1995, the indebtedness (including trade payables) of Harrah's Operating's
Subsidiaries (other than guarantees by Subsidiaries of Harrah's Operating of
Harrah's Operating's Senior Debt) was approximately $403.5 million.
LIMITATION ON MERGER, SALE OR CONSOLIDATION
The Indentures will provide that Harrah's Operating may not consolidate with
or merge with or into another Person or, directly or indirectly, sell, lease or
convey all or substantially all of its assets (computed on a consolidated
basis), whether in a single transaction or a series of related transactions, to
another person, unless (i) (a) Harrah's Operating is the continuing corporation
in the case of a merger or (b) the resulting, surviving or transferee entity is
a corporation or partnership organized under the laws of the United States, any
state thereof or the District of Columbia and expressly assumes by supplemental
indenture all of the obligations of Harrah's Operating under the Debt Securities
and the Indentures; and (ii) no Event of Default (or event or condition that,
after notice or lapse of time or both, would become an Event of Default) shall
have occurred and be continuing immediately after giving effect to such
transaction. The term "all or substantially all" of the Company's assets is
likely to be interpreted by reference to applicable state law at the time, and
will be dependent on the facts and circumstances existing at the time.
Accordingly, the ability of a holder of Debt Securities to file a claim under an
Indenture as a result of a sale, lease, transfer, conveyance or other
disposition of less than all of the assets or properties of Harrah's Operating
or Harrah's Entertainment to another person may be uncertain.
Upon any consolidation or merger or any transfer of all or substantially all
of the assets of Harrah's Operating in accordance with the foregoing, the
successor corporation formed by such consolidation or into which Harrah's
Operating is merged or to which such transfer is made, shall succeed to, and be
substituted for, and may exercise every right and power of, Harrah's Operating
under the Indentures with the same effect as if such successor corporation had
been named as Harrah's Operating therein.
Unless otherwise indicated in a Prospectus Supplement, certain of the
covenants described herein and in the Indentures would not necessarily afford
debt holders protection in the event of a decline in the Company's credit
quality resulting from highly leveraged or other similar transactions involving
the Company.
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EVENTS OF DEFAULT AND REMEDIES
Each Indenture defines an Event of Default as being with respect to each
series of Debt Securities issued pursuant to such Indenture, (i) failure by
Harrah's Operating to pay any installments of interest on such Debt Securities
as and when the same become due and payable and the continuance of any such
failure for 30 days, (ii) failure by Harrah's Operating to pay all or any part
of the principal or premium, if any, on such Debt Securities when and as the
same becomes due and payable at maturity, redemption, by declaration or
otherwise, (iii) failure by Harrah's Operating or Harrah's Entertainment to
observe or perform any covenant or agreement contained in such Debt Securities
or such Indenture and the continuance of such failure for a period of 60 days
after written notice is given to Harrah's Operating or Harrah's Entertainment by
the Trustee or to Harrah's Operating, Harrah's Entertainment and the Trustee by
the Holders of at least 40% in aggregate principal amount of such Debt
Securities outstanding, (iv) certain events of bankruptcy, insolvency or
reorganization in respect of Harrah's Operating or any of its Significant
Subsidiaries, (v) any acceleration of the maturity of certain Debt of Harrah's
Operating or any of its Subsidiaries, or a failure to pay such Debt at its
stated maturity; provided, that an Event of Default shall not be deemed to occur
with respect to the acceleration of the maturity of Debt of Harrah's Operating
or any of its Subsidiaries if the event that caused such acceleration shall be
cured within 10 days, and (vi) certain final judgments not covered by insurance
rendered against Harrah's Operating or any of its Subsidiaries and not stayed or
discharged within 60 days. Each Indenture provides that, with respect to each
series of Debt Securities issued pursuant to such Indenture, if a default (the
term "default" for purposes of this provision being defined as any event or
condition which is, or with notice or lapse of time or both would be, an Event
of Default) occurs and is continuing and if it is known to the Trustee, the
Trustee must, within 90 days after the occurrence of such default, give to the
Holders of such Debt Securities notice of such default; provided, that, except
in the case of default in payment of principal of, premium, if any, or interest
on such Debt Securities the Trustee will be protected in withholding such notice
if it in good faith determines that the withholding of such notice is in the
interest of the Holders of such Debt Securities.
If an Event of Default occurs and is continuing (other than an Event of
Default specified in clause (iv) relating to Harrah's Operating or its
Significant Subsidiaries), unless the principal of all of the Debt Securities of
any series shall have already become due and payable, either the Trustee or the
Holders of 25% in aggregate principal amount of such Debt Securities then
outstanding, by notice in writing to Harrah's Operating and Harrah's
Entertainment (and to the Trustee if given by Holders) (an "Acceleration
Notice"), may declare all principal, determined as set forth below, and accrued
interest thereon to be due and payable immediately (in the case of the Senior
Secured Debt Securities and the Senior Unsecured Debt Securities) and, in the
case of the Senior Subordinated Debt Securities and the Subordinated Debt
Securities, (i) immediately if no Designated Senior Debt is outstanding or (ii)
if Designated Senior Debt is outstanding, upon the earlier of (a) 10 days after
such Acceleration Notice is received by Harrah's Operating or (b) the
acceleration of such Designated Senior Debt. If an Event of Default specified in
clause (iv) above relating to Harrah's Operating or its Significant Subsidiaries
occurs, all principal and accrued interest thereon will be immediately due and
payable on all outstanding Debt Securities of the applicable series without any
declaration or other act on the part of Trustee or the Holders thereof. The
Holders of not less than a majority in aggregate principal amount of such Debt
Securities generally are authorized to rescind such acceleration if all existing
Events of Default, other than the non-payment of the principal of and interest
on such Debt Securities which have become due solely by such acceleration, have
been cured or waived.
Prior to the declaration of acceleration of the maturity of the Debt
Securities of any series, the Holders of a majority in aggregate principal
amount of such Debt Securities at the time outstanding may waive on behalf of
all the Holders of such Debt Securities any default, except a default in the
payment of principal of or interest on any such Debt Securities not yet cured,
or a default with respect to any covenant or provision which cannot be modified
or amended without the consent of the Holder of each outstanding Debt Security
of such series affected. Subject to the provisions of the applicable
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Indenture relating to the duties of the Trustee thereunder, such Trustee is
under no obligation to exercise any of its rights or powers under such Indenture
at the request, order or direction of any of such applicable Holders, unless
such Holders have offered to such Trustee reasonable security or indemnity.
Subject to all provisions of the applicable Indenture and applicable law, the
Holders of a majority in aggregate principal amount of Debt Securities of a
series at the time outstanding have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee under
such Indenture, or exercising any trust or power conferred on such Trustee.
SATISFACTION AND DISCHARGE OF THE INDENTURE, COVENANT DEFEASANCE
Each Indenture ceases to be of further effect as to all outstanding Debt
Securities of a series issued thereunder (except as to (i) rights of
registration of transfer, substitution and exchange of Debt Securities and
Harrah's Operating's right of optional redemption, (ii) rights of Holders of
such Debt Securities to receive from the amounts deposited with the Trustee
payments of principal of, premium, if any, and interest on such Debt Securities,
and any other rights of such Holders with respect to such amounts, (iii) the
rights, obligations and immunities of the Trustee under the applicable Indenture
and (iv) certain other specified provisions in the applicable Indenture (the
foregoing exceptions (i) through (iv) are collectively referred to as the
"Reserved Rights")) and Harrah's Operating will be deemed to have paid and
discharged the entire indebtedness on all of the outstanding Debt Securities of
such series when (i) all outstanding such Debt Securities have been delivered to
the applicable Trustee for cancellation, or (ii) Harrah's Operating has paid or
caused to be paid the principal of and interest on such Debt Securities.
With respect to the Debt Securities not previously delivered to the
applicable Trustee for cancellation that have become due and payable or are by
their terms to become due and payable within one year or are to be called for
redemption within one year upon delivery of notice, the applicable Indenture
also ceases to be in effect (except as to the Reserved Rights and except as to
other obligations of Harrah's Operating under such Indenture preserved under
this paragraph) on the 91st day (or one day after such other greater period of
time in which any such deposit of trust funds may remain subject to bankruptcy
or insolvency laws, e.g., one year after any such deposit) after the irrevocable
deposit by Harrah's Operating with such Trustee, in trust for the benefit of the
Holders of such Debt Securities, (i) money in an amount, (ii) U.S. Government
Obligations which through the payment of interest and principal will provide,
not later than one day before the due date of payment in respect of such Debt
Securities, money in an amount, or (iii) a combination thereof, sufficient to
pay and discharge the principal of and each installment of principal and
interest on such Debt Securities then outstanding at the maturity date or
redemption date, as the case may be, of such principal or installment of
principal or interest. Such a trust may only be established if certain
conditions are satisfied, including delivery by Harrah's Operating to such
Trustee of an opinion of outside counsel acceptable to such Trustee (who may be
outside counsel to Harrah's Operating) to the effect that (i) the defeasance and
discharge will not be deemed, or result in, a federal income taxable event, with
respect to such Holders, (ii) Harrah's Operating's deposit will not result in
Harrah's Operating being subject to regulation under the Investment Company Act
of 1940, (iii) after the passage of 90 days (or any greater period of time in
which any such deposit of trust funds may remain subject to bankruptcy or
insolvency laws insofar as those laws apply to Harrah's Operating) following the
deposit of the trust funds, such funds will not be subject to any bankruptcy,
insolvency or other similar laws affecting creditors' rights generally and (iv)
such Holders will have a valid, perfected and unavoidable (under applicable
bankruptcy and insolvency laws), subject to the passage of time referred to in
clause (iii), first-priority security interest in the trust funds. The
applicable Indenture will not be discharged if, among other things, a default or
an event of default shall have occurred and be continuing on the date of such
deposit or during the period ending on the 91st day (or one day after such other
greater period of time in which any such deposit of trust funds may remain
subject to bankruptcy or insolvency laws) after such date.
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Each Indenture also provides that Harrah's Operating may cease to comply
with certain covenants (other than the Reserved Rights and other than covenants
relating to the timely payment of principal, interest, any premium, or any
installment of principal or interest) described above with respect to each
series of Debt Securities issued hereunder if Harrah's Operating irrevocably
deposits with the Trustee thereunder money and/or U.S. Government Obligations,
which, through the payment of interest and principal thereof in accordance with
their terms, will provide, not later than one day before the date payments in
respect of such Debt Securities are due, money in an amount sufficient to pay
any principal of, premium, if any, and interest on the outstanding Debt
Securities of such series at the maturity date of such principal or installment
of principal or interest. The obligations of Harrah's Operating under such
Indenture, excluding the covenants with which Harrah's Operating may cease to
comply, but including Harrah's Operating's obligations to pay principal and
interest on such Debt Securities, will remain in full force and effect. Such a
trust may only be established if certain conditions are satisfied, including the
delivery by Harrah's Operating to such Trustee of an opinion of counsel
acceptable to such Trustee (who may be counsel to Harrah's Operating) to the
effect that (i) the deposit and related covenant defeasance will not be deemed,
or result in, a Federal income taxable event with respect to Holders of such
Debt Securities, (ii) Harrah's Operating deposit will not result in Harrah's
Operating being subject to regulation under the Investment Company Act of 1940,
(iii) after the passage of 90 days (or any greater period of time in which any
such deposit of trust funds may remain subject to bankruptcy or insolvency laws)
following the deposit of the trust funds, such funds will not be subject to any
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally, and (iv) Holders of such Debt Securities will have a valid, perfected
and unavoidable (under applicable bankruptcy and insolvency laws insofar as such
laws apply to Harrah's Operating), subject to the passage of time referred to in
clause (iii), first-priority security interest in the trust funds. Harrah's
Operating will not be discharged from its obligations with respect to the
covenants under such Indenture if, among other things, a default or an event of
default shall have occurred and be continuing on the date of such deposit or
during the period ending on the 91st day (or one day after such other greater
period of time in which such deposit of trust funds may remain subject to
bankruptcy or insolvency laws) after such date. In the event that Harrah's
Operating takes the necessary action to enable it to omit to comply with certain
covenants of such Indenture as described above and such Debt Securities are
declared due and payable because of the occurrence of an Event of Default, the
amount of money and U.S. Government Obligations on deposit with such Trustee
will be sufficient to pay such Debt Securities at the time of their stated
maturity but may not be sufficient to pay amounts due on such Debt Securities at
the time of acceleration resulting from such Event of Default. In such event,
Harrah's Operating will remain liable for such payments.
REPORTS
Harrah's Operating and Harrah's Entertainment are required to furnish the
Trustee under each Indenture, within 120 days after the end of each fiscal year,
with an officers' certificate to the effect that such officers have conducted or
supervised a review of the activities of Harrah's Operating and its Subsidiaries
and of performance under such Indenture and that, to the best of such officers'
knowledge, based on their review, Harrah's Operating has fulfilled all of its
obligations under such Indenture or, if there has been a default, specifying
each default known to them, its nature and its status.
Harrah's Operating will distribute to registered Holders of Debt Securities
audited annual consolidated financial statements and unaudited summary quarterly
financial statements of the Company (with appropriate footnotes relating to
Harrah's Operating), unless otherwise required by law.
AMENDMENTS AND SUPPLEMENTS
Each Indenture contains provisions permitting Harrah's Operating and the
Trustee to enter into a supplemental indenture for certain limited purposes
without the consent of the Holders of the Debt
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Securities issued thereunder. With the consent of the Holders of not less than a
majority in aggregate principal amount of the applicable series of Debt
Securities at the time outstanding, Harrah's Operating and the Trustee will be
permitted to amend or supplement such Indenture or any supplemental indenture or
modify the rights of such Holders; provided, that no such modification may,
without the consent of each Holder affected thereby: (i) change the Stated
Maturity of the principal of, or any installment of principal of, or any
installment of interest on, any such Debt Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or change the place of payment where, or the coin or
currency in which, any such Debt Security or any premium or the interest thereon
is payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date) or (ii) reduce the percentage in
principal amount of the Outstanding Debt Securities of such series, the consent
of whose Holders is required for any such amendment, supplemental indenture or
waiver provided for in such Indenture, or (iii) modify any of the waiver
provisions, except to increase any required percentage or to provide that
certain other provisions of such Indenture cannot be modified or waived without
the consent of the Holder of each Outstanding Debt Security affected thereby.
NO PERSONAL LIABILITY OF STOCKHOLDERS, OFFICERS, DIRECTORS
No stockholder, officer or director, as such, past, present or future of
Harrah's Operating or Harrah's Entertainment or any successor corporation shall
have any personal liability in respect of the obligations of Harrah's Operating
or Harrah's Entertainment under the Indentures, the Debt Securities or the
Guarantees thereof by reason of his or its status as such stockholder, officer
or director.
DESCRIPTION OF PREFERRED STOCK
The description of Harrah's Operating's Preferred Stock set forth below does
not purport to be complete and is qualified in its entirety by reference to
Harrah's Operating's Certificate of Incorporation (the "Harrah's Operating
Certificate") and Bylaws (the "Harrah's Operating Bylaws").
GENERAL
The Harrah's Operating Certificate authorizes the issuance of 1,000,000
shares of Preferred Stock with a par value of $0.10 per share, none of which was
outstanding as of the date of this Prospectus. Shares of Preferred Stock may be
issued from time to time, in one or more series, as authorized by the Board of
Directors of Harrah's Operating. Prior to issuance of shares of each series, the
Board of Directors is required by the Harrah's Operating Certificate to fix for
each series the terms, preferences, rights, voting powers, restrictions,
limitations as to dividends or other distributions, qualifications and terms or
conditions of redemptions. The Preferred Stock will, when issued, be fully paid
and nonassessable and will have no preemptive rights.
TERMS
The following description of the Preferred Stock sets forth certain general
terms and provisions of the Preferred Stock to which any Prospectus Supplement
may relate. The statements below describing the Preferred Stock are in all
respects subject to and qualified in their entirety by reference to the
applicable provisions of the Harrah's Operating Certificate and Harrah's
Operating Bylaws and any applicable amendment to the Harrah's Operating
Certificate designating terms of a series of Preferred Stock (a "Designating
Amendment").
Reference is made to the Prospectus Supplement relating to the Preferred
Stock offered thereby for specific terms, including:
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(1) The title and stated value of such Preferred Stock;
(2) The number of shares of such Preferred Stock offered, the liquidation
preference per share and the offering price of such Preferred Stock;
(3) The dividend rate(s), period(s) and/or payment date(s) or method(s) of
calculation thereof applicable to such Preferred Stock;
(4) The date from which dividends on such Preferred Stock shall accumulate,
if applicable;
(5) The procedures for any auction and remarketing, if any, for such
Preferred Stock;
(6) The provision for a sinking fund, if any, for such Preferred Stock;
(7) The provision for redemption, if applicable, of such Preferred Stock;
(8) Any listing of such Preferred Stock on any securities exchange;
(9) The terms of Harrah's Entertainment's guarantee with respect to such
Preferred Stock;
(10) The voting rights, if any, of such Preferred Stock;
(11) Any other specific terms, preferences, rights, limitations or
restrictions of such Preferred Stock;
(12) A discussion of federal income tax considerations applicable to such
Preferred Stock;
(13) The relative ranking and preference of such Preferred Stock as to
dividend rights and rights upon liquidation, dissolution or winding up
of the affairs of the Company; and
(14) Any limitations on issuance of any series of Preferred Stock ranking
senior to or on a parity with such series of Preferred Stock as to
dividend rights and rights upon liquidation, dissolution or winding up
of the affairs of the Company.
RANK
Unless otherwise specified in the Prospectus Supplement, the Preferred Stock
will, with respect to dividend rights and rights upon liquidation, dissolution
or winding up of Harrah's Operating, rank (i) senior to all classes or series of
Common Stock of Harrah's Operating, and to all equity securities ranking junior
to such Preferred Stock with respect to dividend rights or rights upon
liquidation, dissolution or winding up of Harrah's Operating; (ii) on a parity
with all equity securities issued by the terms of which specifically provide
that such equity securities rank on a parity with the Preferred Stock with
respect to dividend rights or rights upon liquidation, dissolution or winding up
of Harrah's Operating; and (iii) junior to all equity securities issued by
Harrah's Operating the terms of which specifically provide that such equity
securities rank senior to the Preferred Stock with respect to dividend rights or
rights upon liquidation, dissolution or winding up of Harrah's Operating. The
term "equity securities" does not include convertible debt securities.
DIVIDENDS
Holders of the Preferred Stock of each series will be entitled to receive,
when, as and if declared by the Board of Directors of Harrah's Operating, out of
assets of Harrah's Operating legally available for payment, cash dividends at
such rates and on such dates as will be set forth in the applicable Prospectus
Supplement. Each such dividend shall be payable to holders of record as they
appear on the share transfer books of Harrah's Operating on such record dates as
shall be fixed by the Board of Directors of Harrah's Operating.
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Dividends on any series of the Preferred Stock may be cumulative or
noncumulative, as provided in the applicable Prospectus Supplement. Dividends,
if cumulative, will be cumulative from and after the date set forth in the
applicable Prospectus Supplement. If the Board of Directors of Harrah's
Operating fails to declare a dividend payable on a dividend payment date on any
series of the Preferred Stock for which dividends are noncumulative, then the
holders of such series of the Preferred Stock will have no right to receive a
dividend in respect of the dividend period ending on such dividend payment date,
and Harrah's Operating will have no obligation to pay the dividend accrued for
such period, whether or not dividends on such series are declared payable on any
future dividend payment date.
If Preferred Stock of any series is outstanding, no dividends will be
declared or paid or set apart for payment on any capital stock of Harrah's
Operating of any other series ranking, as to dividends, on a parity with or
junior to the Preferred Stock of such series for any period unless (i) if such
series of Preferred Stock has a cumulative dividend, full cumulative dividends
have been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof is set apart for such payment on the
Preferred Stock of such series for all past dividend periods and the then
current dividend period, or (ii) if such series of Preferred Stock does not have
a cumulative dividend, full dividends for the then current dividend period have
been or contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof is set apart for such payment on the Preferred Stock of
such series. When dividends are not paid in full (or a sum sufficient for such
full payment is not so set apart) upon Preferred Stock of any series and the
shares of any other series of Preferred Stock ranking on a parity as to
dividends with the Preferred Stock of such series, all dividends declared upon
Preferred Stock of such series and on any other series of Preferred Stock
ranking on a parity as to dividends with such Preferred Stock shall be declared
pro rata so that the amount of dividends declared per share of Preferred Stock
of such series and such other series of Preferred Stock shall in all cases bear
to each other the same ratio that accrued dividends per share on the Preferred
Stock of such series (which shall not include any accumulation in respect of
unpaid dividends for prior dividend periods if such Preferred Stock does not
have a cumulative dividend) and such other series of Preferred Stock bear to
each other. No interest, or sum of money in lieu of interest, shall be payable
in respect of any dividend payment or payments on Preferred Stock of such series
which may be in arrears.
Except as provided in the immediately preceding paragraph, unless (i) if
such series of Preferred Stock has a cumulative dividend, full cumulative
dividends on the Preferred Stock of such series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
is set apart for payment for all past dividend periods and the then current
dividend period, and (ii) if such series of Preferred Stock does not have a
cumulative dividend, full dividends on the Preferred Stock of such series have
been or contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof is set apart for payment for the then current dividend
period, no dividends (other than in shares of Common Stock or other shares of
capital stock ranking junior to the Preferred Stock of such series as to
dividends and upon liquidation) shall be declared or paid or set aside for
payment nor shall any other distribution be declared or made upon the Common
Stock, or any other capital stock of Harrah's Operating ranking junior to or on
a parity with the Preferred Stock of such series as to dividends or upon
liquidation, nor shall any shares of Common Stock, or any other shares of
capital stock of Harrah's Operating ranking junior to or on a parity with the
Preferred Stock of such series as to dividends or upon liquidation, be redeemed,
purchased or otherwise acquired for any consideration (or any amounts be paid to
or made available for a sinking fund for the redemption of any such shares) by
Harrah's Operating (except by conversion into or exchange for other capital
stock of Harrah's Operating ranking junior to the Preferred Stock of such series
as to dividends and upon liquidation).
Any dividend payment made on shares of a series of Preferred Stock shall
first be credited against the earliest accrued but unpaid dividend due with
respect to shares of such series which remains payable.
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REDEMPTION
If so provided in the applicable Prospectus Supplement, the Preferred Stock
will be subject to mandatory redemption or redemption at the option of Harrah's
Operating, as a whole or in part, in each case upon the terms, at the times and
at the redemption prices set forth in such Prospectus Supplement.
The Prospectus Supplement relating to a series of Preferred Stock that is
subject to mandatory redemption will specify the number of shares of such
Preferred Stock that shall be redeemed by Harrah's Operating in each year
commencing after a date to be specified, at a redemption price per share to be
specified, together with an amount equal to all accrued and unpaid dividends
thereon (which shall not, if such Preferred Stock does not have a cumulative
dividend, include any accumulation in respect of unpaid dividends for prior
dividend periods) to the date of redemption. The redemption price may be payable
in cash or other property, as specified in the applicable Prospectus Supplement.
Notwithstanding the foregoing, unless (i) if a series of Preferred Stock has
a cumulative dividend, full cumulative dividends on all shares of such series of
Preferred Stock shall have been or contemporaneously are declared and paid or
declared and a sum sufficient for the payment thereof set apart for payment for
all past dividend periods and the then current dividend period, and (ii) if a
series of Preferred Stock does not have a cumulative dividend, full dividends on
all shares of the Preferred Stock of such series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for the then current dividend period, no shares of such
series of Preferred Stock shall be redeemed unless all outstanding shares of
Preferred Stock of such series are simultaneously redeemed. In addition, unless
(i) if such series of Preferred Stock has a cumulative dividend, full cumulative
dividends on all outstanding shares of such series of Preferred Stock have been
or contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for payment for all past dividend periods and the
then current dividend period, and (ii) if such series of Preferred Stock does
not have a cumulative dividend, full dividends on the Preferred Stock of such
series have been or contemporaneously are declared and paid or declared and a
sum sufficient for the payment thereof set apart for payment for the then
current dividend period, Harrah's Operating shall not purchase or otherwise
acquire directly or indirectly any shares of Preferred Stock of such series
(except by conversion into or exchange for capital stock of Harrah's Operating
ranking junior to the Preferred Stock of such series as to dividends and upon
liquidation); provided, however, that the foregoing shall not prevent the
purchase or acquisition of shares of Preferred Stock of such series pursuant to
a purchase or exchange offer made on the same terms to holders of all
outstanding shares of Preferred Stock of such series.
If fewer than all of the outstanding shares of Preferred Stock of any series
are to be redeemed, the number of shares to be redeemed will be determined by
Harrah's Operating and such shares may be redeemed pro rata from the holders of
record of such shares in proportion to the number of such shares held or for
which redemption is requested by such holder (with adjustments to avoid
redemption of fractional shares) or by any other equitable manner determined by
Harrah's Operating.
Notice of redemption will be mailed at least 30 days but not more than 60
days before the redemption date to each holder of record of Preferred Stock of
any series to be redeemed at the address shown on the stock transfer books of
Harrah's Operating. Each notice shall state: (i) the redemption date; (ii) the
number of shares and series of the Preferred Stock to be redeemed; (iii) the
redemption price; (iv) the place or places where certificates for such Preferred
Stock are to be surrendered for payment of the redemption price; (v) that
dividends on the shares to be redeemed will cease to accrue on such redemption
date; and (vi) the date upon which the holder's conversion rights, if any, as to
such shares shall terminate. If fewer than all the shares of Preferred Stock of
any series are to be redeemed, the notice mailed to each such holder thereof
shall also specify the number of shares of Preferred Stock to be redeemed from
each such holder and, upon redemption, a new certificate shall be issued
representing the unredeemed shares without cost to the holder thereof. If notice
of redemption of any Preferred Stock has been given and if the funds necessary
for such redemption have been set aside by
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Harrah's Operating in trust for the benefit of the holders of any Preferred
Stock so called for redemption, then from and after the redemption date
dividends will cease to accrue on such Preferred Stock, and all rights of the
holders of such shares will terminate, except the right to receive the
redemption price. In order to facilitate the redemption of shares of Preferred
Stock, the Board of Directors may fix a record date for the determination of
shares of Preferred Stock to be redeemed, such record date to be not less than
30 or more than 60 days prior to the date fixed for such redemption.
Subject to applicable law and the limitation on purchases when dividends on
Preferred Stock are in arrears, Harrah's Operating may, at any time and from
time to time, purchase any shares of Preferred Stock in the open market, by
tender or by private agreement.
LIQUIDATION PREFERENCE
Upon any voluntary or involuntary liquidation, dissolution or winding up of
the affairs of Harrah's Operating, then, before any distribution or payment
shall be made to the holders of any other class or series of capital stock of
Harrah's Operating ranking junior to the Preferred Stock in the distribution of
assets upon any liquidation, dissolution or winding up of Harrah's Operating,
the holders of each series of Preferred Stock shall be entitled to receive out
of assets of Harrah's Operating legally available for distribution to
stockholders liquidating distributions in the amount of the liquidation
preference per share, if any, set forth in the applicable Prospectus Supplement,
plus an amount equal to all dividends accrued and unpaid thereon (which shall
not include any accumulation in respect of unpaid noncumulative dividends for
prior dividend periods). After payment of the full amount of the liquidating
distributions to which they are entitled, the holders of Preferred Stock will
have no right or claim to any of the remaining assets of Harrah's Operating. In
the event that, upon any such voluntary or involuntary liquidation, dissolution
or winding up, the available assets of Harrah's Operating are insufficient to
pay the amount of the liquidating distributions on all outstanding shares of
Preferred Stock and the corresponding amounts payable on all shares of other
classes or series of capital stock of Harrah's Operating ranking on a parity
with the Preferred Stock in the distribution of assets upon the liquidation,
dissolution or winding up, then the holders of the Preferred Stock and all other
such classes or series of capital stock shall share ratably in any such
distribution of assets in proportion to the full liquidating distributions to
which they would otherwise be respectively entitled.
If liquidating distributions shall have been made in full to all holders of
Preferred Stock, the remaining assets of Harrah's Operating shall be distributed
among the holders of any other classes or series of capital stock ranking junior
to the Preferred Stock upon liquidation, dissolution or winding up, according to
their respective rights and preferences and in each case according to their
respective number of shares. For such purposes, the consolidation or merger of
Harrah's Operating with or into any other corporation, trust or entity, or the
sale, lease or conveyance of all or substantially all of the property or
business of the Company, shall not be deemed to constitute a liquidation,
dissolution or winding up of the Company.
GUARANTEE
Harrah's Entertainment will irrevocably and unconditionally agree, to the
extent set forth herein, to pay in full to the holders of the Preferred Stock of
any series, the Guarantee Payments (as defined below) (except to the extent paid
by Harrah's Operating), as and when due, regardless of any defense, right of
set-off or counterclaim which Harrah's Operating may have or assert (the
"Guarantee"). The following payments to the extent not paid by Harrah's
Operating (the "Guarantee Payments") will be subject to the Guarantee (without
duplication): (i) any accumulated and unpaid dividends which have been
theretofore declared on the Preferred Stock of such series out of funds legally
available therefor, (ii) the redemption price (including all accumulated unpaid
dividends) payable out of funds legally available therefor with respect to
Preferred Stock of any series called for redemption by Harrah's Operating and
(iii) upon the liquidation of Harrah's Operating, the lesser of (a) the
aggregate of the
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stated liquidation preference and all accumulated and unpaid dividends (whether
or not declared) to the date of payment and (b) the amount of assets of Harrah's
Operating legally available for distribution to holders of Preferred Stock of
such series in liquidation. Harrah's Entertainment's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
Harrah's Entertainment to the holders of Preferred Stock of any series or by
causing Harrah's Operating to pay such amounts to such holders.
In connection with the Guarantee, Harrah's Entertainment will covenant that,
so long as any shares of Preferred Stock of any series remain outstanding,
neither Harrah's Entertainment nor any majority owned subsidiary of Harrah's
Entertainment will declare or pay any dividend on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of Harrah's Entertainment's
capital stock or make any guarantee payments with respect to the foregoing
(other than payments under the Guarantee, redemptions described under
"Description of Common Stock--Redemption," payments to redeem common share
purchase rights under Harrah's Entertainment's shareholder rights plan dated
February 7, 1990, or the declaration of a dividend of similar share purchase
rights in the future), if at such time, Harrah's Entertainment will be in
default with respect to its payment or other obligations under the Guarantee.
The Guarantee will constitute an unsecured obligation of Harrah's
Entertainment and will rank (i) subordinate and junior in right of payment to
all other liabilities of Harrah's Entertainment, (ii) pari passu with the most
senior preferred stock now or hereafter issued by Harrah's Entertainment and
with any guarantee now or hereafter entered into by Harrah's Entertainment in
respect of any preferred or preference stock of any affiliate of Harrah's
Entertainment and (iii) senior to Harrah's Entertainment's common stock. For
purposes of clause (ii), pari passu means that any payments to which
beneficiaries of the Guarantee are entitled must be shared with holders of any
preferred or preference stock to which the Guarantee is stated to be pari passu
("Pari Passu Stock") to the same extent as would be required under applicable
law if instead the Guarantee constituted a class of preferred or preference
stock of Harrah's Entertainment ranking pari passu with such Pari Passu Stock as
to such payments.
The Guarantee will constitute a guarantee of payment and not of collection.
Accordingly, a holder of Preferred Stock may enforce the Guarantee directly
against Harrah's Entertainment, and Harrah's Entertainment will waive any right
or remedy to require that any action be brought against Harrah's Operating or
any other person or entity before proceeding against Harrah's Entertainment. The
Guarantee will not be discharged except by payment of the Guarantee Payments in
full to the extent not paid by Harrah's Operating.
Since Harrah's Entertainment is a holding company, the rights of Harrah's
Entertainment, and hence the rights of creditors of Harrah's Entertainment
(including the rights of holders of Preferred Stock under the Guarantee), to
participate in any distribution of the assets of any subsidiary upon its
liquidation or reorganization or otherwise is necessarily subject to the prior
claims of creditors of the subsidiary, except to the extent that claims of
Harrah's Entertainment itself as a creditor of the subsidiary may be recognized.
VOTING RIGHTS
Holders of the Preferred Stock will not have any voting rights, except as
set forth below or as otherwise from time to time required by law or as
indicated in the applicable Prospectus Supplement.
Unless provided otherwise for any series of Preferred Stock, so long as any
shares of Preferred Stock of a series remain outstanding, Harrah's Operating
will not, without the affirmative vote or consent of the holders of at least
two-thirds of the shares of such series of Preferred Stock outstanding at the
time, given in person or by proxy, either in writing or at a meeting (such
series voting separately as a class), (i) authorize or create, or increase the
authorized or issued amount of, any class or series of capital stock ranking
prior to such series of Preferred Stock with respect to payment of dividends or
the
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distribution of assets upon liquidation, dissolution or winding up or reclassify
any authorized capital stock of Harrah's Operating into such shares, or create,
authorize or issue any obligation or security convertible into or evidencing the
right to purchase any such shares; or (ii) amend, alter or repeal the provisions
of the Harrah's Operating Certificate or the Designating Amendment for such
series of Preferred Stock, whether by merger, consolidation or otherwise (an
"Event"), so as to materially and adversely affect any right, preference,
privilege or voting power of such series of Preferred Stock or the holders
thereof; provided, however, with respect to the occurrence of any of the Events
set forth in (ii) above, so long as the Preferred Stock remains outstanding with
the terms thereof materially unchanged, taking into account that upon the
occurrence of an Event Harrah's Operating may not be the surviving entity, the
occurrence of any such Event shall not be deemed to materially and adversely
affect such rights, preferences, privileges or voting power of holders of
Preferred Stock, and provided further that (x) any increase in the amount of the
authorized Preferred Stock or the creation or issuance of any other series of
Preferred Stock, or (y) any increase in the amount of authorized shares of such
series or any other series of Preferred Stock, in each case ranking on a parity
with or junior to the Preferred Stock of such series with respect to payment of
dividends or the distribution of assets upon liquidation, dissolution or winding
up, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
The foregoing voting provisions will not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of such series of Preferred Stock shall have
been redeemed or called for redemption and sufficient funds shall have been
deposited in trust to effect such redemption.
GAMING REDEMPTION
The Harrah's Operating Certificate provides that any equity security of
Harrah's Operating can be redeemed by Harrah's Operating if, among other
circumstances, in the judgment of the Board of Directors, such redemption is
necessary to avoid any regulatory sanctions against, or to prevent the loss of,
or to secure the reinstatement of any license, franchise or entitlement from any
governmental agency held by Harrah's Operating, an affiliate of Harrah's
Operating, or any entity in which Harrah's Operating or an affiliate is an
owner, which license, franchise or entitlement is needed to conduct any portion
of the business of Harrah's Operating, any such affiliate or other entity or
which license, franchise or entitlement is conditioned upon some or all of the
holders of such security possessing prescribed qualifications.
PLAN OF DISTRIBUTION
The Company may offer the Securities directly to purchasers or to or through
underwriters, dealers or agents. Any such underwriter(s), dealer(s) or agent(s)
involved in the offer and sale of the Securities in respect of which this
Prospectus is delivered will be named in the Prospectus Supplement. The
Prospectus Supplement with respect to such Securities will also set forth the
terms of the offering of such Securities, including the purchase price of such
Securities and the proceeds to the Company from such sale, any underwriting
discounts and other items constituting underwriters' compensation, any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers and any securities exchanges on which such Securities may be
listed.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Prospectus Supplement will
describe the method of distribution of the Securities.
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If underwriters are used in an offering of Securities, the name of each
managing underwriter, if any, and any other underwriters and terms of the
transaction, including any underwriting discounts and other items constituting
compensation of the underwriters and dealers, if any, will be set forth in the
Prospectus Supplement relating to such offering and the Securities will be
acquired by the underwriters for their own accounts and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
Any initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time. It is anticipated
that any underwriting agreement pertaining to any Securities will (1) entitle
the underwriters to indemnification by the Company against certain civil
liabilities under the Securities Act, or to contribution with respect to
payments which the underwriters may be required to make in respect thereof, (2)
provide that the obligations of the underwriters will be subject to certain
conditions precedent and (3) provide that the underwriters will be obligated to
purchase all Securities offered in a particular offering if any such Securities
are purchased.
If a dealer is used in an offering of Securities, the Company will sell such
Securities to the dealer, as principal. The dealer may then resell such
Securities to the public at varying prices to be determined by such dealer at
the time of resale. The name of the dealer and the terms of the transaction will
be set forth in the Prospectus Supplement relating thereto.
If an agent is used in an offering of Debt Securities, the agent will be
named, and the terms of the agency will be set forth, in the Prospectus
Supplement relating thereto. Unless otherwise indicated in such Prospectus
Supplement, an agent will act on a best efforts basis for the period of its
appointment.
Dealers and agents named in a Prospectus Supplement may be deemed to be
underwriters (within the meaning of the Securities Act) of the Securities
described therein and, under agreements which may be entered into with the
Company, may be entitled to indemnification by the Company against certain civil
liabilities under the Securities Act. Underwriters, dealers and agents may be
customers of, engage in transactions with, or perform services for, the Company
in the ordinary course of business.
Offers to purchase Securities may be solicited, and sales thereof may be
made, by the Company directly to institutional investors or others, who may be
deemed to be underwriters within the meaning of the Securities Act with respect
to any resales thereof. The terms of any such offer will be set forth in the
Prospectus Supplement relating thereto.
If so indicated in the Prospectus Supplement, the Company will authorize
underwriters or other agents of the Company to solicit offers by certain
institutional investors to purchase Securities from the Company pursuant to
contracts providing for payment and delivery at a future date. Institutional
investors with which such contracts may be made include commercial and savings
banks, insurance companies, pension funds, investment companies, educational and
charitable institutions and others, but in all cases such purchasers must be
approved by the Company. The obligations of any purchaser under any such
contract will not be subject to any conditions except that (1) the purchase of
the Securities shall not at the time of delivery be prohibited under the laws of
any jurisdiction to which such purchaser is subject and (2) if the Securities
are also being sold to underwriters, the Company shall have sold to such
underwriters the Securities not subject to delayed delivery. Underwriters and
other agents will not have any responsibility in respect of the validity or
performance of such contracts.
The anticipated date of delivery of Securities will be set forth in the
Prospectus Supplement relating to each offering.
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LEGAL MATTERS
Certain legal matters with respect to the Securities offered hereby will be
passed upon for Harrah's Entertainment and Harrah's Operating by Latham &
Watkins and E. O. Robinson, Jr., Senior Vice President and General Counsel of
Harrah's Entertainment and Harrah's Operating.
EXPERTS
The audited financial statements and schedules incorporated by reference in
this Prospectus and in the Registration Statement, to the extent and for the
periods indicated in their report, have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in giving said report.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
All expenses other than the Securities and Exchange Commission filing fees
are estimated.
SEC registration fee................................................ $ 68,966
Accountants' fees and expenses...................................... 5,000
Legal fees and expenses ............................................ 40,000
Printing and engraving expenses..................................... 14,000
Trustee's and registrar's fees and expenses......................... 3,000
Miscellaneous....................................................... 7,500
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Total............................................................... $138,466
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ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of Delaware empowers Harrah's
Entertainment and Harrah's Operating to indemnify, subject to the standards set
forth therein, any person who is a party in any action in connection with any
action, suit or proceeding brought or threatened by reason of the fact that the
person was a director, officer, employee or agent of such company, or is or was
serving as such with respect to another entity at the request of such company.
The General Corporation Law of Delaware also provides that Harrah's
Entertainment and Harrah's Operating may purchase insurance on behalf of any
such director, officer, employee or agent.
Article Tenth of the Certificate of Incorporation of Harrah's Entertainment
provides for indemnification of the officers and directors of Harrah's
Entertainment to the full extent permitted by the Delaware General Corporation
Law.
Article VI of the Bylaws of Harrah's Operating provides, in effect, for the
indemnification by Harrah's Operating of each director and officer of Harrah's
Operating to the fullest extent permitted by applicable law.
Harrah's Entertainment has entered into Indemnification Agreements with its
directors, executive officers and certain other officers. Generally, the
Indemnification Agreements provide that Harrah's Entertainment will indemnify
such persons against any and all expenses, judgments, fines, penalties and
amounts paid in settlement (including all interest, assessments and other
charges paid or payable in connection with or in respect to such expenses,
judgments, fines, penalties or amounts paid in settlement) of any Claim by
reason of (or arising in part out of) an Indemnifiable Event. "Claim" is defined
as any threatened, pending or completed action, suit or proceeding or any
inquiry or investigation, whether conducted by Harrah's Entertainment or any
other party, that the indemnitee in good faith believes might lead to the
institution of any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or other. "Indemnifiable Event" is defined as any
event or occurrence related to the fact that indemnitee is or was a director,
officer, employee, trustee, agent or fiduciary of Harrah's Entertainment, or is
or was serving at the request of Harrah's Entertainment or a director, officer,
employee, trustee, agent or fiduciary of another corporation, partnership, joint
venture, employee benefit plan, trust or other enterprise, or by reason of
anything done or not done by indemnitee in any such capacity. Notwithstanding
the foregoing, (i) the obligations of Harrah's Entertainment shall be subject to
the condition that the reviewing party (as defined) shall not have determined
(in a written opinion, in any case in which special, independent counsel is
involved) that indemnitee would
II-1
<PAGE>
not be permitted to be indemnified under applicable law, and (ii) the obligation
of Harrah's Entertainment to make an expense advance shall be subject to the
condition that, if, when and to the extent that the reviewing party determines
that indemnitee would not be permitted to be so indemnified under applicable
law, Harrah's Entertainment shall be entitled to be reimbursed by indemnitee
(who has agreed to reimburse Harrah's Entertainment, for any amounts theretofore
paid; provided, that if indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that indemnitee should be
indemnified under applicable law, any determination made by the reviewing party
that indemnitee would not be permitted to be indemnified under applicable law
shall not be binding and indemnitee shall not be required to reimburse Harrah's
Entertainment for any expense advance until a final judicial determination is
made with respect thereto as to which all rights of appeal therefrom have been
exhausted or lapsed).
Section 102(b)(7) of the Delaware General Corporation Law enables a Delaware
corporation to provide in its certificate of incorporation for the elimination
or limitation of the personal liability of a director to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director.
Any such provision cannot eliminate or limit a director's liability (1) for any
breach of the director's duty of loyalty to the corporation or its stockholders;
(2) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law; (3) under Section 174 of the Delaware
General Corporation Law (which imposes liability on directors for unlawful
payment of dividends or unlawful stock purchase or redemption); or (4) for any
transaction from which the director derived an improper personal benefit.
Article Thirteenth of the Certificate of Incorporation of Harrah's Entertainment
eliminates the liability of a director of Harrah's Entertainment to Harrah's
Entertainment or its stockholders for monetary damages for breach of fiduciary
duty as a director to the full extent permitted by the Delaware General
Corporation Law.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.1 Certificate of Incorporation of The Promus Companies Incorporated. (1)
4.2 Certificate of Amendment to Certificate of Incorporation of The Promus Companies
Incorporated dated April 29, 1994. (1)
4.3 Certificate of Amendment of Certificate of Incorporation of The Promus Companies
Incorporated effective June 30, 1995. (2)
4.4 Certificate of Amendment of Certificate of Incorporation of The Promus Companies
Incorporated effective May 26, 1995. (3)
*4.5 Certificate of Incorporation of Harrah's Operating Company, Inc.
*4.6 Bylaws of Harrah's Operating Company, Inc.
4.7 Rights Agreement dated as of February 7, 1990, between The Promus Companies
Incorporated and The Bank of New York as Rights Agent. (4)
4.8 Indenture dated as of January 15, 1984, between Holiday Inns, Inc. and Irving
Trust Company, as trustee. (5)
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.9 First Supplemental Indenture dated as of July 15, 1987, among Irving Trust
Company, as resigning trustee with respect to the 1999 Notes, Indiana National
Bank as successor trustee with respect to the 1999 Notes and Holiday Inns, Inc.;
Second Supplemental Indenture dated as of January 8, 1988, under Indenture dated
as of January 15, 1984, between Holiday Inns, Inc., and Irving Trust Company, as
trustee with respect to 8 3/8% Notes due 1996; Third Supplemental Indenture
dated as of January 8, 1988, under Indenture dated as of January 15, 1984, among
Holiday Inns, Inc., Irving Trust Company, as resigning trustee with respect to
the 8 3/8% Notes due 1996, and LaSalle National Bank as successor trustee with
respect to the 8 3/8% Notes due 1996; Fourth Supplemental Indenture dated as of
February 23, 1988, under Indenture dated as of January 15, 1984, between Holiday
Inns, Inc. and LaSalle National Bank, as trustee with respect to the 8 3/8%
Notes due 1996. (6)
4.10 Fifth Supplemental Indenture dated as of January 23, 1990, with respect to the 8
3/8% Notes due 1996, among LaSalle National Bank, as trustee, The Promus
Companies Incorporated and Holiday Inns, Inc., as issuer; Sixth Supplemental
Indenture dated as of February 7, 1990, with respect to the 8 3/8% Notes due
1996, among Holiday Inns, Inc., Embassy Suites, Inc., The Promus Companies
Incorporated and LaSalle National Bank; Form of Note for 8 3/8% Notes due 1996.
(4)
4.11 Indenture dated as of April 1, 1992, with respect to the 10 7/8% Senior
Subordinated Notes due 2002, among The Bank of New York, as trustee, The Promus
Companies Incorporated, as guarantor, and Embassy Suites, Inc., as issuer; Form
of Note for 10 7/8% Senior Subordinated Notes due 2002. (7)
4.12 Indenture dated as of August 1, 1993, with respect to the 8 3/4% Senior
Subordinated Notes due 2000, among The Bank of New York, as trustee, The Promus
Companies Incorporated, as guarantor, and Embassy Suites, Inc., as issuer; Form
of Note for 8 3/4% Senior Subordinated Notes due 2000. (8)
4.13 First Supplemental Indenture dated as of June 2, 1995, with respect to the 8
3/4% Senior Subordinated Notes due 2000, among Embassy Suites, Inc., as issuer,
The Promus Companies Incorporated, as guarantor, and The Bank of New York, as
trustee. (9)
4.14 First Supplemental Indenture dated as of June 2, 1995, with respect to the 10
7/8% Senior Subordinated Notes due 2002, among Embassy Suites, Inc., as issuer,
The Promus Companies Incorporated, as guarantor, and The Bank of New York, as
trustee. (9)
4.15 Interest Swap Agreement between Bank of America National Trust and Savings
Association and Embassy Suites, Inc. dated May 14, 1993. (8)
4.16 Interest Swap Agreement between NationsBank of North Carolina, N.A. and Embassy
Suites, Inc. dated May 18, 1993. (8)
4.17 Interest Swap Agreement between The Sumitomo Bank, Limited and Embassy Suites,
Inc. dated October 22, 1992; Interest Swap Agreement between The Bank of Nova
Scotia and Embassy Suites, Inc. dated October 22, 1992; Interest Swap Agreement
between The Nippon Credit Bank and Embassy Suites, Inc. dated October 22, 1992.
(7)
4.18 Interest Swap Agreement between Bank of America National Trust and Savings
Association and Embassy Suites, Inc. dated January 25, 1995. (10)
4.19 Interest Swap Agreement between NationsBank, N.A. (Carolinas) and Embassy
Suites, Inc. dated January 25, 1995. (10)
4.20 Interest Swap Agreement between The Bank of Nova Scotia and Embassy Suites, Inc.
dated January 25, 1995 and amended February 2, 1995. (10)
4.21 Interest Swap Agreement between The Bank of Nova Scotia and Embassy Suites, Inc.
dated March 16, 1995. (10)
4.22 Interest Swap Agreement between The Sumitomo Bank, Limited and Embassy Suites,
Inc. dated June 5, 1995. (11)
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.23 Interest Swap Agreement between Bankers Trust Company and Embassy Suites, Inc.
dated May 16, 1995. (11)
4.24 Interest Swap Agreement between Bankers Trust Company and Embassy Suites, Inc.
dated June 6, 1995. (11)
4.25 Credit Agreement, dated as of July 22, 1993 and amended and restated as of June
9, 1995, among The Promus Companies Incorporated, Embassy Suites, Inc., certain
subsidiaries of Embassy Suites, Inc., various banks, Bankers Trust Company, The
Bank of New York, CIBC, Inc., Credit Lyonnais, Atlanta Agency, First Interstate
Bank of California, the Long-Term Credit Bank of Japan, Limited, New York
Branch, NationsBank of Georgia, N.A., Societe Generale and Sumitomo Bank,
Limited, New York Branch, as Agents, and Bankers Trust Company, as
Administrative Agent. (11)
4.26 Amended and Restated Reimbursement Agreement, dated as of July 22, 1993, among
Embassy Suites, Inc., The Promus Companies Incorporated, Marina Associates and
The Sumitomo Bank, Limited, New York Branch. (12)
4.27 Master Collateral Agreement, dated as of July 22, 1993, among The Promus
Companies Incorporated, Embassy Suites, Inc., the other Collateral Grantors
parties thereto, Bankers Trust Company, as Administrative Agent, and Bankers
Trust Company as Collateral Agent. (12)
4.28 Security Agreement dated as of July 22, 1993, among Embassy Suites, Inc., the
Collateral Grantors parties thereto and Bankers Trust Company, as Collateral
Agent. (12)
4.29 Deed of Trust, Leasehold Deed of Trust, Assignment, Assignment of Leases and
Rents, Security Agreement and Financing Statement, dated as of July 22, 1993,
from Embassy Suites, Inc., Harrah's Laughlin, Inc., and Harrah's Reno Holding
Company, Inc., the Grantors, to First American Title Company of Nevada, as
Trustee, for the benefit of Bankers Trust Company, as Beneficiary. (12)
4.30 Mortgage, Leasehold Mortgage, Assignment, Assignment of Leases and Rents and
Security Agreement, dated as of July 22, 1993, from Marina Associates and
Embassy Suites, Inc., the Mortgagors, to Bankers Trust Company, as Collateral
Agent and the Mortgagee. (12)
4.31 Pledge Agreement, dated as of July 22, 1993, between The Promus Companies
Incorporated and Bankers Trust Company, as Collateral Agent. (12)
4.32 Pledge Agreement, dated as of July 22, 1993, among Embassy Suites, Inc., ESI
Equity Development Corporation, Harrah's, Harrah's Club, Casino Holding Company,
and Bankers Trust Company, as the General Collateral Agent, and Bank of America
Nevada as the Nevada Collateral Agent. (12)
4.33 First Amendment to Master Collateral Agreement, dated as of June 30, 1995, among
The Promus Companies Incorporated, Embassy Suites, Inc., the other Collateral
Grantors parties thereto, Bankers Trust Company, as Administrative Agent, and
Bankers Trust Company as Collateral Agent amending the Master Collateral
Agreement, dated as of July 22, 1993, among The Promus Companies Incorporated,
Embassy Suites, Inc., the other Collateral Grantors parties thereto, Bankers
Trust Company, as Administrative Agent, and Bankers Trust Company as Collateral
Agent. (11)
4.34 First Amendment to Parent Pledge Agreement, dated as of June 30, 1995, among The
Promus Companies Incorporated and Bankers Trust Company, as Collateral Agent,
amending the Pledge Agreement, dated as of July 22, 1993, between The Promus
Companies Incorporated and Bankers Trust Company, as Collateral Agent. (11)
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.35 First Amendment to Company/Sub Pledge Agreement, dated as of June 30, 1995,
among Embassy Suites, Inc., Harrah's, Harrah's Club, and Bankers Trust Company,
as the General Collateral Agent, and Bank of America Nevada as the Nevada
Collateral Agent, amending the Pledge Agreement, dated as of July 22, 1993,
among Embassy Suites, Inc., ESI Equity Development Corporation, Harrah's,
Harrah's Club, Casino Holding Company, and Bankers Trust Company, as the General
Collateral Agent, and Bank of America Nevada as the Nevada Collateral Agent.
(11)
4.36 First Amendment to Security Agreement, dated as of June 30, 1995, among Embassy
Suites, Inc., the Collateral Grantors parties thereto and Bankers Trust Company,
as Collateral Agent, amending the Security Agreement dated as of July 22, 1993,
among Embassy Suites, Inc., the Collateral Grantors parties thereto and Bankers
Trust Company, as Collateral Agent. (11)
4.37 First Amendment to Mortgage, Leasehold Mortgage, Assignment, Assignment of
Leases and Rents and Security Agreement, dated as of June 30, 1995, among
Embassy Suites, Inc., Marina Associates, the Mortgagors, to Bankers Trust
Company, as Collateral Agent and the Mortgagee, amending the Mortgage, Leasehold
Mortgage, Assignment, Assignment of Leases and Rents and Security Agreement,
dated as of July 22, 1993, from Marina Associates and Embassy Suites, Inc., the
Mortgagors, to Bankers Trust Company, as Collateral Agent and the Mortgagee.
(11)
4.38 First Amendment to Deed of Trust, Leasehold Deed of Trust, Assignment,
Assignment of Leases and Rents, Security Agreement and Financing Statement,
dated as of June 30, 1995, among Embassy Suites, Inc., Harrah's Laughlin, Inc.,
Harrah's Reno Holding Company, Inc., Harrah's, Harrah's Club and Harrah's Las
Vegas, Inc., the Collateral Grantors, and Bankers Trust Company as Collateral
Agent and Beneficiary, amending the Deed of Trust, Leasehold Deed of Trust,
Assignment, Assignment of Leases and Rents, Security Agreement and Financing
Statement, dated as of July 22, 1993, from Embassy Suites, Inc., Harrah's
Laughlin, Inc., and Harrah's Reno Holding Company, Inc., the Grantors, to First
American Title Company of Nevada, as Trustee, for the benefit of Bankers Trust
Company, as Beneficiary. (11)
4.39 Credit Agreement, dated as of June 9, 1995, among The Promus Companies
Incorporated, Embassy Suites, Inc., certain subsidiaries of Embassy Suites,
Inc., various banks, Bankers Trust Company, The Bank of New York, CIBC, Inc.,
Credit Lyonnais, Atlanta Agency, First Interstate Bank of California, The
Long-term Credit Bank of Japan, Limited, New York Branch, NationsBank of
Georgia, N.A., Societe Generale and The Sumitomo Bank, Limited, New York Branch,
as Agents, and Bankers Trust Company, as Administrative Agent. (11)
+4.40 Form of Indenture relating to Senior Secured Debt Securities.
+4.41 Form of Indenture relating to Senior Unsecured Debt Securities.
+4.42 Form of Indenture relating to Senior Subordinated Debt Securities.
+4.43 Form of Indenture relating to Subordinated Debt Securities.
*5 Opinion of Latham & Watkins regarding legality.
+12 Statement of computation of ratio of earnings to fixed charges.
+24.1 Consent of Arthur Andersen LLP.
*24.2 Consent of Latham & Watkins (included in Exhibit 5).
+25 Powers of Attorney.
+26.1 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Secured Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
+26.2 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Unsecured Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
+26.3 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Subordinated Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
+26.4 Statement of Eligibility and Qualifications on Form T-1 relating to Subordinated
Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
</TABLE>
- ------------
* Filed herewith.
+ Previously filed.
FOOTNOTES
(1) Incorporated by reference from the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ending March 31, 1994, filed with the Commission May
12, 1994, File No. 1-10410.
(2) Incorporated by reference from the Company's Proxy Statement, Annex V, dated
April 25, 1995, File No. 1-10410.
(3) Incorporated by reference from the Company's Proxy Statement, Annex VI,
dated April 25, 1995, File No. 1-10410.
(4) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 29, 1989, filed March 28, 1990, File No.
1-10410.
(5) Incorporated by reference from Holiday Inns, Inc.'s Quarterly Report on Form
10-Q for the quarter ended June 29, 1984, filed August 10, 1984, File No.
1-4804.
(6) Incorporated by reference from Holiday Corporation's Annual Report on Form
10-K for the fiscal year ended January 1, 1988, filed March 31, 1988, File
No. 1-8900.
(7) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992, filed March 12, 1993, File No.
1-10410.
(8) Incorporated by reference from the Company's and Embassy Suites, Inc.'s
Amendment No. 2 to Form S-4 Registration Statement, File No. 33-49509-01,
filed July 16, 1993.
(9) Incorporated by reference from the Company's Current Report on Form 8-K
filed June 15, 1995, File No. 1-10410.
(10) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1994, filed March 21, 1995, File No.
1-10410.
(11) Incorporated by reference from the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1995, filed August 14, 1995, File No.
1-10410.
(12) Incorporated by reference from the Company's Current Report on Form 8-K
filed August 6, 1993, File No. 1-10410.
ITEM 17. UNDERTAKINGS
(a) The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement;
II-6
<PAGE>
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrants pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrants' annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrants pursuant to the foregoing provisions, or otherwise, the
registrants have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrants of expenses
incurred or paid by a director, officer or controlling person of the registrants
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrants will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-7
<PAGE>
HARRAH'S ENTERTAINMENT SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Harrah's Entertainment, Inc. has duly caused this Amendment No. 1 to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized at Memphis, Tennessee on October 11, 1995.
HARRAH'S ENTERTAINMENT, INC.
Dated: October 11, 1995 By PHILIP G. SATRE
......................................
(Philip G. Satre, President
and Chief Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in their respective capacities with Harrah's Entertainment, Inc. on the
dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- -------------------------------------- ----------------------------- ----------------
<S> <C> <C>
* Director October 11, 1995
......................................
(James L. Barksdale)
* Director October 11, 1995
......................................
(Susan Clark-Jackson)
* Director October 11, 1995
......................................
(James B. Farley)
*
...................................... Director October 11, 1995
(Joe M. Henson)
* Director October 11, 1995
......................................
(D. Ralph Horn)
* Director and Chairman October 11, 1995
......................................
(Michael D. Rose)
* Director October 11, 1995
......................................
(Walter J. Salmon)
* Director, President and Chief October 11, 1995
...................................... Executive Officer
(Philip G. Satre)
* Director October 11, 1995
......................................
(Boake A. Sells)
* Director October 11, 1995
......................................
(Eddie N. Williams)
*
...................................... Director October 11, 1995
(Shirley Young)
* Chief Financial Officer October 11, 1995
......................................
(Charles A. Ledsinger, Jr.)
* Controller and Principal October 11, 1995
...................................... Accounting Officer
(Michael N. Regan)
*By E. O. ROBINSON, JR.
..................................
E. O. Robinson, Jr.
Attorney-in-fact
</TABLE>
II-8
<PAGE>
HARRAH'S OPERATING SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Harrah's Operating Company, Inc. has duly caused this Amendment No. 1 to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized at Memphis, Tennessee on October 11, 1995.
HARRAH'S OPERATING COMPANY, INC.
Dated: October 11, 1995 By PHILIP G. SATRE
....................................
(Philip G. Satre, President
and Chief Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in their respective capacities with Harrah's Operating Company, Inc. on
the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- -------------------------------------- ----------------------------- ----------------
<S> <C> <C>
* Director, President and Chief October 11, 1995
...................................... Executive Officer
(Philip G. Satre)
* Director and Chief Financial October 11, 1995
...................................... Officer
(Charles A. Ledsinger, Jr.)
* Controller and Principal October 11, 1995
...................................... Accounting Officer
(Michael N. Regan)
*By E. O. ROBINSON, JR.
..................................
E. O. Robinson, Jr.
Attorney-in-fact
</TABLE>
II-9
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.1 Certificate of Incorporation of The Promus Companies Incorporated. (1)
4.2 Certificate of Amendment to Certificate of Incorporation of The Promus Companies
Incorporated dated April 29, 1994. (1)
4.3 Certificate of Amendment of Certificate of Incorporation of The Promus Companies
Incorporated effective June 30, 1995. (2)
4.4 Certificate of Amendment of Certificate of Incorporation of The Promus Companies
Incorporated effective May 26, 1995. (3)
*4.5 Certificate of Incorporation of Harrah's Operating Company, Inc.
*4.6 Bylaws of Harrah's Operating Company, Inc.
4.7 Rights Agreement dated as of February 7, 1990, between The Promus Companies
Incorporated and The Bank of New York as Rights Agent. (4)
4.8 Indenture dated as of January 15, 1984, between Holiday Inns, Inc. and Irving
Trust Company, as trustee. (5)
4.9 First Supplemental Indenture dated as of July 15, 1987, among Irving Trust
Company, as resigning trustee with respect to the 1999 Notes, Indiana National
Bank as successor trustee with respect to the 1999 Notes and Holiday Inns, Inc.;
Second Supplemental Indenture dated as of January 8, 1988, under Indenture dated
as of January 15, 1984, between Holiday Inns, Inc., and Irving Trust Company, as
trustee with respect to 8 3/8% Notes due 1996; Third Supplemental Indenture
dated as of January 8, 1988, under Indenture dated as of January 15, 1984, among
Holiday Inns, Inc., Irving Trust Company, as resigning trustee with respect to
the 8 3/8% Notes due 1996, and LaSalle National Bank as successor trustee with
respect to the 8 3/8% Notes due 1996; Fourth Supplemental Indenture dated as of
February 23, 1988, under Indenture dated as of January 15, 1984, between Holiday
Inns, Inc. and LaSalle National Bank, as trustee with respect to the 8 3/8%
Notes due 1996. (6)
4.10 Fifth Supplemental Indenture dated as of January 23, 1990, with respect to the 8
3/8% Notes due 1996, among LaSalle National Bank, as trustee, The Promus
Companies Incorporated and Holiday Inns, Inc., as issuer; Sixth Supplemental
Indenture dated as of February 7, 1990, with respect to the 8 3/8% Notes due
1996, among Holiday Inns, Inc., Embassy Suites, Inc., The Promus Companies
Incorporated and LaSalle National Bank; Form of Note for 8 3/8% Notes due 1996.
(4)
4.11 Indenture dated as of April 1, 1992, with respect to the 10 7/8% Senior
Subordinated Notes due 2002, among The Bank of New York, as trustee, The Promus
Companies Incorporated, as guarantor, and Embassy Suites, Inc., as issuer; Form
of Note for 10 7/8% Senior Subordinated Notes due 2002. (7)
4.12 Indenture dated as of August 1, 1993, with respect to the 8 3/4% Senior
Subordinated Notes due 2000, among The Bank of New York, as trustee, The Promus
Companies Incorporated, as guarantor, and Embassy Suites, Inc., as issuer; Form
of Note for 8 3/4% Senior Subordinated Notes due 2000. (8)
4.13 First Supplemental Indenture dated as of June 2, 1995, with respect to the 8
3/4% Senior Subordinated Notes due 2000, among Embassy Suites, Inc., as issuer,
The Promus Companies Incorporated, as guarantor, and The Bank of New York, as
trustee. (9)
4.14 First Supplemental Indenture dated as of June 2, 1995, with respect to the 10
7/8% Senior Subordinated Notes due 2002, among Embassy Suites, Inc., as issuer,
The Promus Companies Incorporated, as guarantor, and The Bank of New York, as
trustee. (9)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.15 Interest Swap Agreement between Bank of America National Trust and Savings
Association and Embassy Suites, Inc. dated May 14, 1993. (8)
4.16 Interest Swap Agreement between NationsBank of North Carolina, N.A. and Embassy
Suites, Inc. dated May 18, 1993. (8)
4.17 Interest Swap Agreement between The Sumitomo Bank, Limited and Embassy Suites,
Inc. dated October 22, 1992; Interest Swap Agreement between The Bank of Nova
Scotia and Embassy Suites, Inc. dated October 22, 1992; Interest Swap Agreement
between The Nippon Credit Bank and Embassy Suites, Inc. dated October 22, 1992.
(7)
4.18 Interest Swap Agreement between Bank of America National Trust and Savings
Association and Embassy Suites, Inc. dated January 25, 1995. (10)
4.19 Interest Swap Agreement between NationsBank, N.A. (Carolinas) and Embassy
Suites, Inc. dated January 25, 1995. (10)
4.20 Interest Swap Agreement between The Bank of Nova Scotia and Embassy Suites, Inc.
dated January 25, 1995 and amended February 2, 1995. (10)
4.21 Interest Swap Agreement between The Bank of Nova Scotia and Embassy Suites, Inc.
dated March 16, 1995. (10)
4.22 Interest Swap Agreement between The Sumitomo Bank, Limited and Embassy Suites,
Inc. dated June 5, 1995. (11)
4.23 Interest Swap Agreement between Bankers Trust Company and Embassy Suites, Inc.
dated May 16, 1995. (11)
4.24 Interest Swap Agreement between Bankers Trust Company and Embassy Suites, Inc.
dated June 6, 1995. (11)
4.25 Credit Agreement, dated as of July 22, 1993 and amended and restated as of June
9, 1995, among The Promus Companies Incorporated, Embassy Suites, Inc., certain
subsidiaries of Embassy Suites, Inc., various banks, Bankers Trust Company, The
Bank of New York, CIBC, Inc., Credit Lyonnais, Atlanta Agency, First Interstate
Bank of California, the Long-Term Credit Bank of Japan, Limited, New York
Branch, NationsBank of Georgia, N.A., Societe Generale and Sumitomo Bank,
Limited, New York Branch, as Agents, and Bankers Trust Company, as
Administrative Agent. (11)
4.26 Amended and Restated Reimbursement Agreement, dated as of July 22, 1993, among
Embassy Suites, Inc., The Promus Companies Incorporated, Marina Associates and
The Sumitomo Bank, Limited, New York Branch. (12)
4.27 Master Collateral Agreement, dated as of July 22, 1993, among The Promus
Companies Incorporated, Embassy Suites, Inc., the other Collateral Grantors
parties thereto, Bankers Trust Company, as Administrative Agent, and Bankers
Trust Company as Collateral Agent. (12)
4.28 Security Agreement dated as of July 22, 1993, among Embassy Suites, Inc., the
Collateral Grantors parties thereto and Bankers Trust Company, as Collateral
Agent. (12)
4.29 Deed of Trust, Leasehold Deed of Trust, Assignment, Assignment of Leases and
Rents, Security Agreement and Financing Statement, dated as of July 22, 1993,
from Embassy Suites, Inc., Harrah's Laughlin, Inc., and Harrah's Reno Holding
Company, Inc., the Grantors, to First American Title Company of Nevada, as
Trustee, for the benefit of Bankers Trust Company, as Beneficiary. (12)
4.30 Mortgage, Leasehold Mortgage, Assignment, Assignment of Leases and Rents and
Security Agreement, dated as of July 22, 1993, from Marina Associates and
Embassy Suites, Inc., the Mortgagors, to Bankers Trust Company, as Collateral
Agent and the Mortgagee. (12)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
4.31 Pledge Agreement, dated as of July 22, 1993, between The Promus Companies
Incorporated and Bankers Trust Company, as Collateral Agent. (12)
4.32 Pledge Agreement, dated as of July 22, 1993, among Embassy Suites, Inc., ESI
Equity Development Corporation, Harrah's, Harrah's Club, Casino Holding Company,
and Bankers Trust Company, as the General Collateral Agent, and Bank of America
Nevada as the Nevada Collateral Agent. (12)
4.33 First Amendment to Master Collateral Agreement, dated as of June 30, 1995, among
The Promus Companies Incorporated, Embassy Suites, Inc., the other Collateral
Grantors parties thereto, Bankers Trust Company, as Administrative Agent, and
Bankers Trust Company as Collateral Agent amending the Master Collateral
Agreement, dated as of July 22, 1993, among The Promus Companies Incorporated,
Embassy Suites, Inc., the other Collateral Grantors parties thereto, Bankers
Trust Company, as Administrative Agent, and Bankers Trust Company as Collateral
Agent. (11)
4.34 First Amendment to Parent Pledge Agreement, dated as of June 30, 1995, among The
Promus Companies Incorporated and Bankers Trust Company, as Collateral Agent,
amending the Pledge Agreement, dated as of July 22, 1993, between The Promus
Companies Incorporated and Bankers Trust Company, as Collateral Agent. (11)
4.35 First Amendment to Company/Sub Pledge Agreement, dated as of June 30, 1995,
among Embassy Suites, Inc., Harrah's, Harrah's Club, and Bankers Trust Company,
as the General Collateral Agent, and Bank of America Nevada as the Nevada
Collateral Agent, amending the Pledge Agreement, dated as of July 22, 1993,
among Embassy Suites, Inc., ESI Equity Development Corporation, Harrah's,
Harrah's Club, Casino Holding Company, and Bankers Trust Company, as the General
Collateral Agent, and Bank of America Nevada as the Nevada Collateral Agent.
(11)
4.36 First Amendment to Security Agreement, dated as of June 30, 1995, among Embassy
Suites, Inc., the Collateral Grantors parties thereto and Bankers Trust Company,
as Collateral Agent, amending the Security Agreement dated as of July 22, 1993,
among Embassy Suites, Inc., the Collateral Grantors parties thereto and Bankers
Trust Company, as Collateral Agent. (11)
4.37 First Amendment to Mortgage, Leasehold Mortgage, Assignment, Assignment of
Leases and Rents and Security Agreement, dated as of June 30, 1995, among
Embassy Suites, Inc., Marina Associates, the Mortgagors, to Bankers Trust
Company, as Collateral Agent and the Mortgagee, amending the Mortgage, Leasehold
Mortgage, Assignment, Assignment of Leases and Rents and Security Agreement,
dated as of July 22, 1993, from Marina Associates and Embassy Suites, Inc., the
Mortgagors, to Bankers Trust Company, as Collateral Agent and the Mortgagee.
(11)
4.38 First Amendment to Deed of Trust, Leasehold Deed of Trust, Assignment,
Assignment of Leases and Rents, Security Agreement and Financing Statement,
dated as of June 30, 1995, among Embassy Suites, Inc., Harrah's Laughlin, Inc.,
Harrah's Reno Holding Company, Inc., Harrah's, Harrah's Club and Harrah's Las
Vegas, Inc., the Collateral Grantors, and Bankers Trust Company as Collateral
Agent and Beneficiary, amending the Deed of Trust, Leasehold Deed of Trust,
Assignment, Assignment of Leases and Rents, Security Agreement and Financing
Statement, dated as of July 22, 1993, from Embassy Suites, Inc., Harrah's
Laughlin, Inc., and Harrah's Reno Holding Company, Inc., the Grantors, to First
American Title Company of Nevada, as Trustee, for the benefit of Bankers Trust
Company, as Beneficiary. (11)
4.39 Credit Agreement, dated as of June 9, 1995, among The Promus Companies
Incorporated, Embassy Suites, Inc., certain subsidiaries of Embassy Suites,
Inc., various banks, Bankers Trust Company, The Bank of New York, CIBC, Inc.,
Credit Lyonnais, Atlanta Agency, First Interstate Bank of California, The
Long-term Credit Bank of Japan, Limited, New York Branch, NationsBank of
Georgia, N.A., Societe Generale and The Sumitomo Bank, Limited, New York Branch,
as Agents, and Bankers Trust Company, as Administrative Agent. (11)
+4.40 Form of Indenture relating to Senior Secured Debt Securities.
+4.41 Form of Indenture relating to Senior Unsecured Debt Securities.
+4.42 Form of Indenture relating to Senior Subordinated Debt Securities.
+4.43 Form of Indenture relating to Subordinated Debt Securities.
*5 Opinion of Latham & Watkins regarding legality.
+12 Statement of computation of ratio of earnings to fixed charges.
+24.1 Consent of Arthur Andersen LLP.
*24.2 Consent of Latham & Watkins (included in Exhibit 5).
+25 Powers of Attorney.
+26.1 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Secured Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ----------
<C> <S>
+26.2 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Unsecured Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
+26.3 Statement of Eligibility and Qualifications on Form T-1 relating to Senior
Subordinated Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
+26.4 Statement of Eligibility and Qualifications on Form T-1 relating to Subordinated
Debt Securities with NationsBank of Tennessee, N.A., as Trustee.
</TABLE>
- ------------
* Filed herewith.
+ Previously filed.
FOOTNOTES
(1) Incorporated by reference from the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ending March 31, 1994, filed with the Commission May
12, 1994, File No. 1-10410.
(2) Incorporated by reference from the Company's Proxy Statement, Annex V, dated
April 25, 1995, File No. 1-10410.
(3) Incorporated by reference from the Company's Proxy Statement, Annex VI,
dated April 25, 1995, File No. 1-10410.
(4) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 29, 1989, filed March 28, 1990, File No.
1-10410.
(5) Incorporated by reference from Holiday Inns, Inc.'s Quarterly Report on Form
10-Q for the quarter ended June 29, 1984, filed August 10, 1984, File No.
1-4804.
(6) Incorporated by reference from Holiday Corporation's Annual Report on Form
10-K for the fiscal year ended January 1, 1988, filed March 31, 1988, File
No. 1-8900.
(7) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992, filed March 12, 1993, File No.
1-10410.
(8) Incorporated by reference from the Company's and Embassy Suites, Inc.'s
Amendment No. 2 to Form S-4 Registration Statement, File No. 33-49509-01,
filed July 16, 1993.
(9) Incorporated by reference from the Company's Current Report on Form 8-K
filed June 15, 1995, File No. 1-10410.
(10) Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1994, filed March 21, 1995, File No.
1-10410.
(11) Incorporated by reference from the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1995, filed August 14, 1995, File No.
1-10410.
(12) Incorporated by reference from the Company's Current Report on Form 8-K
filed August 6, 1993, File No. 1-10410.
Exhibit 4.5
RESTATED CERTIFICATE OF INCORPORATION
of
EMBASSY SUITES, INC.
The undersigned, E.O. Robinson, Jr. and Stephen H. Brammell, certify
that they are a Senior Vice President and an Assistant Secretary,
respectively, of EMBASSY SUITES, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), and do hereby
further certify as follows:
1. The name of the corporation is Embassy Suites, Inc., the name under
which it was originally incorporated.
2. The original Certificate of Incorporation of the Corporation was
filed in the Office of the Secretary of State of the State of Delaware on
August 8, 1983. An amendment to the Certificate of Incorporation was filed
in the office of the Secretary of State of the State of Delaware on November
22, 1989.
3. The amendment to the certificate of incorporation effected by this
certificate is to modify and restate Article Ninth of the original
certificate of Incorporation (which is Article Eighth of this Restated
Certification of Incorporation).
4. The amendments and the restatement of the certificate of
incorporation have been duly adopted by written consent of the stockholder of
the Corporation in accordance with Sections 242 and 245 of the General
Corporation Law of the State of Delaware.
5. The text of the Certificate of Incorporation of Embassy Suites,
Inc. as heretofore amended is hereby restated and further amended to read in
its entirety as follows;
FIRST: The name of the Corporation is Embassy Suites, Inc.
-----
SECOND: The address of the registered office of the corporation in the
------
State of Delaware is 1208 Orange Street, County of New Castle, Wilmington
Delaware 19801. The name of the registered agent of the Corporation as such
address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act
-----
or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
FOURTH: The total number of shares of stock which the Corporation is
------
authorized to issue is one thousand (1,000) shares of common stock, having a
par value of one dollar ($1.00) per share.
FIFTH: The business and affairs of the Corporation shall be managed
-----
by the board of directors, and the directors need not be elected by ballot.
SIXTH: In furtherance and not in limitation of the powers conferred
-----
by
<PAGE>
the laws of the State of Delaware, the board of directors is expressly
authorized, without stockholders action, to adopt, amend or repeal the
bylaws.
SEVENTH: The Corporation reserves the right to amend, alter change or
-------
repeal any provision contained in this Certificate of Incorporation in the
manner prescribed by the laws of the State of Delaware. All rights herein
conferred are granted subject to this reservation.
EIGHTH: Any equity securities of the Corporation are held subject
------
to the condition that the Corporation has the absolute right to redeem such
securities by action of the Board of Directors, if, (A) in the judgment of
the Board of Directors, any holder of the securities is determined by any
gaming regulatory agency to be unsuitable, or has an application for a
license or permit rejected, or has a previously issued license or permit
rescinded, suspended, revoked or not renewed, as the case may be, or that
such action otherwise should be taken to the extent necessary to avoid any
regulatory sanctions or, to prevent the loss of or secure the reinstatement
of any gaming license, franchise or other entitlement from any governmental
agency held by the Corporation, any affiliate of the Corporation or any
entity in which such Corporation or affiliate is an owner, which gaming
license, franchise or other entitlement is (i) conditioned upon some or all
of the holders of securities possessing prescribed qualifications, or (ii)
needed to allow the conduct of any portion of the business of the Corporation
or any such affiliate or other entity; or (B) the holder of any equity
security of the Corporation fails to enforce the provisions of the fourth
paragraph of this Article EIGHTH against its direct owners or any parties
Controlled by, Controlling, or under common Control with such holder;
provided that no holder of any equity security of this Corporation whose
equity securities are publicly traded pursuant to the Securities Exchange Act
of 1934, as amended, and traded on the New York Stock Exchange, the American
Stock Exchange, or NASDAQ be required to enforce the provisions of the fourth
paragraph of this Article EIGHTH. For purposes of this Article EIGHTH,
"Control" shall mean the ability, whether by the direct or indirect ownership
of shares or other equity interest, by contract or otherwise, to elect a
majority of the directors of a corporation, to select the managing partner of
a partnership or to control a majority of the members of the governing board
of such partnership representing any single partner, or otherwise to select,
or have the power to remove and select, a majority of those persons
exercising governing authority over an entity, and, in the case of a limited
partnership shall mean the sole general partner, all of the general partners
to the extent each has equal management control and authority, or the
managing general partner or managing general partners thereof.
The terms of such redemption shall permit the Corporation to redeem the
equity securities of a disqualified holder at a redemption price equal to the
fair market value of such securities, excluding any dividends or other
remuneration thereon from the date the Corporation receives notice of a
determination of unsuitability or disqualification from the government
agency, or in such lesser amount as may be specified by any applicable gaming
law, regulation or rule.
From and after the redemption date or such earlier date as mandated by
any applicable gaming law, regulation or rule, any and all rights of whatever
nature, which may be held by the owners of any equity securities of the
Corporation selected for redemption (including any rights to vote or
participate in any distributions of the Corporation), shall cease and
terminate and they shall thereafter.
<PAGE>
be entitled only to receive that amount payable upon redemption.
The holder of any equity security of this Corporation shall require that
the articles of incorporation, charters, partnership agreements or other
formative documents of each person or entity owning a direct interest in such
holder or who are Controlled by, Control, or under common Control with such
holder (other than a holder who has been exempted from a suitability
determination by any gaming regulatory agency) shall incorporate the provisions
of this Article EIGHTH into their formative documents; provided that no holder
of any equity security of the Corporation whose equity securities are publicly
traded pursuant to the Securities Exchange Act of 1934, as amended, and traded
on the New York Stock Exchange, the American Stock Exchange, or NASDAQ shall be
required to incorporate the provisions of this Article EIGHTH into their
formative documents.
Any debt securities of the Corporation are held subject to the condition
that if a holder thereof is found to be disqualified or found unsuitable by any
government agency, including the New Jersey Casino Control Commission, the
Corporation shall have a right to redeem such securities.
The terms of such redemption for debt securities shall be subject to and in
accordance with the terms and provisions of the instrument governing such
securities.
IN WITNESS WHEREOF, Embassy Suites, Inc. has caused this certificate to be
signed by E.O. Robinson, Jr., its Senior Vice President, and attested to by
Stephen H. Brammell, its Assistant Secretary, this 8th day of July, 1994.
--- ----
EMBASSY SUITES, INC.
By: /s/ E. O. Robinson, Jr.
---------------------------
E. O. Robinson, Jr.,
Senior Vice President
ATTEST:
/s/ S. H. Brammell
- -----------------------
Assistant Secretary
STATE OF TENNESSEE
COUNTY OF SHELBY
This instrument was acknowledged before me on the 8th day of July, 1994
--- ----
by E.O. Robinson, Jr., Senior Vice President, and attested to by Stephen H.
Brammell, Assistant Secretary, of Embassy Suites, Inc.
/s/ Juanita M. Francis
-----------------------------
Notary Public
My Commission Expires:
MY COMMISSION EXPIRES JULY 15 1997
- -----------------------------
<PAGE>
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
EMBASSY SUITES, INC.
Embassy Suites, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:
FIRST: That the Board of Directors of Embassy Suites, Inc., by the
unanimous written consent of its members filed with the minutes of the Board,
duly adopted resolutions setting forth a proposed amendment to the Restated
Certificate of Incorporation of said corporation, declaring said amendment to be
advisable and in the best interest of the corporation and its stockholder, and
recommending that its stockholder approve the proposed amendment by written
consent in lieu of a meeting. The resolution setting forth the proposed
amendment is as follows:
RESOLVED, that the Board of Directors of Embassy Suites, Inc. (the
"Company"), hereby approves and sets forth the following proposed amendment
(the "Proposed Amendment") to Article FIRST of the Company's Restated
Certificate of Incorporation:
That Article FIRST of the Restated Certificate of Incorporation of the
Company be amended to read in its entirety as follows:
"FIRST: The name of the Corporation is Harrah's Operating Company, Inc."
-----
SECOND: That thereafter, pursuant to the resolution of its Board of
Directors, the stockholder of said corporation approved the amendment by written
consent without a meeting in accordance with Section 228 of the General
Corporation Law of the State of Delaware.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, said corporation has caused this Certificate to be
signed by E.O. Robinson, Jr., its Senior Vice President, the 30th day of June,
1995.
By: /s/ E. O. Robinson, Jr.
------------------------
E. O. Robinson, Jr.
Senior Vice President
<PAGE>
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
HARRAH'S OPERATING COMPANY, INC.
Harrah's Operating Company, Inc., a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That the Board of Directors of Harrah's Operating Company, Inc.
(the "Corporation"), by the unanimous written consent of its members filed
with the minutes of the Board, duly adopted resolutions setting forth a
proposed amendment to the Restated Certificate of Incorporation of said
Corporation, declaring said amendment to be advisable and in the best interest
of the Corporation and its stockholder, and recommending that its stockholder
approve the proposed amendment by written consent in lieu of a meeting. The
resolution setting forth the proposed amendment is as follows:
RESOLVED, that the Board of Directors of the Corporation hereby approves
and sets forth the following proposed amendment (the "Proposed Amendment") to
Article FOURTH of the Company's Certificate of Incorporation:
That Article FOURTH of the Restated Certificate of Incorporation of the
Corporation be amended to read in its entirety as follows:
"FOURTH: A. The total number of shares of stock which the Corporation
------
shall have authority to issue is 1,001,000, consisting of 1,000 shares of Common
Stock, par value $1.00 per share (the "Common Stock"), and 1,000,000 shares of
Preferred Stock, par value $0.10 per share (the "Preferred Stock").
B. Shares of Preferred Stock may be issued from time to time
in one or more series, as provided for herein or as provided for by the Board of
Directors as permitted hereby. All shares of Preferred Stock shall be of equal
rank and shall be identical, except in respect of the terms fixed herein for
the series provided for herein or fixed by the Board of Directors for series
provided for by the Board of Directors as permitted hereby. All shares of any
one series shall be identical in all respects with all the other shares of
such series, except the shares of any one series issued at different times may
differ as to the dates from which dividends thereon may be cumulative.
<PAGE>
The Board of Directors is hereby authorized, by resolution or resolutions,
to establish, out of the unissued shares of Preferred Stock not then allocated
to any series of Preferred Stock, additional series of Preferred Stock. Before
any shares of any such additional series are issued, the Board of Directors
shall fix and determine, and is hereby expressly empowered to fix and determine,
by resolutions, the distinguishing characteristics and the relative rights,
preferences, privileges and immunities of the shares thereof, so far as not
inconsistent with the provisions of this Article FOURTH. Without limiting the
generality of the foregoing, the Board of Directors may fix and determine:
1. The designation of such series and the number of shares which
shall constitute such series;
2. The rate of dividend, if any, payable on shares of such series;
3. Whether the shares of such series shall be cumulative, non-
cumulative or partially cumulative as to dividends, and the dates from
which any cumulative dividends are to accumulate.
4. Whether the shares of such series may be redeemed, and, if so,the
price or prices at which and the terms and conditions on which shares of
such series may be redeemed;
5. The amount payable upon shares of such series in the event of
the voluntary or involuntary dissolution, liquidation or winding up of the
affairs of the Corporation;
6. The sinking fund provisions, if any, for the redemption of shares
of such series;
7. The voting rights, if any, of the shares of such series;
8. The terms and conditions, if any, on which shares of such series
may be converted into shares of capital stock of the Corporation of any
other class or series;
9. Whether the shares of such series are to be preferred over shares
of capital stock of the Corporation of any other class or series as to
dividends, or upon the voluntary or involuntary dissolution, liquidation,
or winding up of the affairs of the Corporation, or otherwise; and
10. Any other characteristics, preferences, limitations, rights,
privileges, immunities or terms not inconsistent with the provisions of
this article FOURTH.
C. Except as otherwise provided in this Certificate of Incorporation
(including this Section C of Article FOURTH and including the resolutions
adopted by the
<PAGE>
Board of Directors pursuant to Section B of this Article FOURTH), each holder
of Common Stock shall be entitled to one vote for each share of Common Stock
held by him on all matters submitted to stockholders for a vote and each holder
of Preferred Stock of any series that has voting rights shall be entitled to
such number of votes for each share held by him as may be specified in the
resolutions providing for the issuance of such series."
SECOND: That thereafter, the stockholder of said Corporation approved the
amendment by written consent without a meeting in accordance with Section 228 of
the General Corporation Law of the State of Delaware.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, said Corporation has caused this Certificate to be
signed by E.O. Robinson , Jr., its Senior Vice President, the 10th day of
October, 1995.
By:/s/ E.O. Robinson, Jr.
----------------------
E.O. Robinson, Jr.
Senior Vice President
EXHIBIT 4.6
BYLAWS
OF
EMBASSY SUITES, INC.
(Amended April 29, 1994)
ARTICLE I
OFFICES
SECTION 1. Registered Office. The registered office of Embassy Suites,
Inc. (the "Corporation") shall be at The Corporation Trust Center, 1209 Orange
Street, in the City of Wilmington, County of New Castle, State of Delaware.
SECTION 2. Other Offices. The Corporation may also have offices at
such other places both within and without the State of Delaware as the Board of
Directors of the Corporation (the "Board of Directors") may from time to time
determine.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. Place of Meetings. Meetings of the stockholders for the
election of directors or for any other purpose shall be held at such time and
place, either within or without the State of Delaware as shall be designated
from time to time by the Board of Directors and stated in the notice of the
meeting or in a duly executed waiver of notice thereof.
SECTION 2. Annual Meetings. The annual meeting of stockholders shall
be held on the first Friday in May in each year or on such other date and at
such time as may be fixed by the Board of Directors and stated in the notice of
the meeting, for the purpose of electing directors and for the transaction of
only such other business as is properly brought before the meeting in accordance
with these Bylaws.
Written notice of an annual meeting stating the place, date and hour of the
meeting, shall be given to each stockholder entitled to vote at such meeting not
less than ten nor more than sixty days before the date of the meeting.
SECTION 3. Special Meetings. Unless otherwise prescribed by law or by
the Certificate of Incorporation, special meetings of stockholders, for any
purpose or purposes, may only be called by a majority of the entire Board of
Directors or by the Chairman or the President.
<PAGE>
Written notice of a special meeting stating the place, date and hour of the
meeting, shall be given to each stockholder entitled to vote at such meeting not
less than ten nor more than sixty days before the date of the meeting.
SECTION 4. Quorum. Except as otherwise provided by law or by the
Certificate of Incorporation, the holders of a majority of the capital stock
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business. If, however, such quorum shall
not be present or represented at any meeting of the stockholders, the holders of
a majority of the votes entitled to be cast by the stockholders entitled to vote
thereat, present in person or represented by proxy may adjourn the meeting from
time to time, without notice other than announcement at the meeting, until a
quorum shall be present or represented by proxy. At such adjourned meeting at
which a quorum shall be present or represented, any business may be transacted
which might have been transacted at the meeting as originally noticed. If the
adjournment is for more than thirty days, or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder entitled to vote at the meeting.
SECTION 5. Voting. Unless otherwise required by law, the Certificate
of Incorporation or these Bylaws, any question brought before any meeting of
stockholders shall be decided by the vote of the holders of a majority of the
stock represented and entitled to vote thereat. Each stockholder represented at
a meeting of stockholders shall be entitled to cast one vote for each share of
the capital stock entitled to vote thereat held by such stockholder, unless
otherwise provided by the Certificate of Incorporation. Such votes may be cast
in person or by proxy but no proxy shall be voted after three years from its
date, unless such proxy provides for a longer period. The Board of Directors,
in its discretion, or the officer of the Corporation presiding at a meeting of
stockholders, in his discretion, may require that any votes cast at such meeting
shall be cast by written ballot.
SECTION 6. List of Stockholders Entitled to Vote. The officer of the
Corporation who has charge of the stock ledger of the Corporation shall prepare
and make, at least ten days before every meeting of stockholders, a complete
list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder and the number
of shares registered in the name of each stockholder. Such list shall be open
to the examination of any stockholder, for any purpose germane to the meeting,
during ordinary business hours, for a period of at least ten days prior to the
meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder of the Corporation who is
present.
SECTION 7. Stock Ledger. The stock ledger of the Corporation shall be
the only evidence as to who are the stockholders entitled to examine the stock
ledger, the list required by Section 6 of this Article II or the books of the
2
<PAGE>
Corporation, or to vote in person or by proxy at any meeting of stockholders.
ARTICLE III
DIRECTORS
SECTION 1. Meetings. The Board of Directors of the Corporation may
hold meetings, both regular and special, either within or without the State of
Delaware. Regular meetings of the Board of Directors may be held without notice
at such time and at such place as may from time to time be determined by the
Board of Directors. Special meetings of the Board of Directors may be called by
the Chairman of the Board or the President or a majority of the entire Board of
Directors. Notice thereof stating the place, date and hour of the meeting shall
be given to each director either by mail not less than forty-eight (48) hours
before the date of the meeting, by telephone or telegram on twenty-four (24)
hours' notice, or on such shorter notice as the person or persons calling such
meeting may deem necessary or appropriate in the circumstances.
SECTION 2. Quorum. Except as may be otherwise specifically provided by
law, the Certificate of Incorporation or these Bylaws, at all meetings of the
Board of Directors, a majority of the entire Board of Directors shall constitute
a quorum for the transaction of business and the act of a majority of the
directors present at any meeting at which there is a quorum shall be the act of
the Board of Directors. If a quorum shall not be present at any meeting of the
Board of Directors, a majority of the directors present thereat may adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present.
SECTION 3. Actions of Board of Directors. Unless otherwise provided by
the Certificate of Incorporation or these Bylaws, any action required or
permitted to be taken at any meeting of the Board of Directors or of any
committee thereof may be taken without a meeting, if all the members of the
Board of Directors or committee, as the case may be, consent thereto in writing,
and the writing or writings are filed with the minutes of proceedings of the
Board of Directors or committee.
SECTION 4. Meetings by Means of Conference Telephone. Unless otherwise
provided by the Certificate of Incorporation or these Bylaws, members of the
Board of Directors of the Corporation, or any committee designated by the Board
of Directors, may participate in a meeting of the Board of Directors or such
committee by means of a conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and participation in a meeting pursuant to this Section 4 of Article III shall
constitute presence in person at such meeting.
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SECTION 5. Committees. The Board of Directors may, by resolution
passed by a majority of the entire Board of Directors, designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation. The Board of Directors may designate one or more directors as
alternate members of any committee, who may replace any absent or disqualified
member at any meeting of any such committee. In the absence or disqualification
of a member of a committee, and in the absence of a designation by the Board of
Directors of an alternate member to replace the absent or disqualified member,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint
another member of the Board of Directors to act at the meeting in the place of
any absent or disqualified member. Any committee, to the extent allowed by law
and provided in the resolution establishing such committee, shall have and may
exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation. Each committee shall
keep regular minutes and report to the Board of Directors when required.
SECTION 6. Compensation. The directors may be paid their expenses, if
any, of attendance at each meeting of the Board of Directors and may be paid a
fixed sum for attendance at each meeting of the Board of Directors or a stated
salary as director. No such payment shall preclude any director from serving
the Corporation in any other capacity and receiving compensation therefor.
Members of special or standing committees may be allowed like compensation for
attending committee meetings.
SECTION 7. Interested Directors. No contract or transaction between
the Corporation and one or more of its directors or officers, or between the
Corporation and any other corporation, partnership, association, or other
organization in which one or more of its directors or officers are directors or
officers, or have a financial interest, shall be void or voidable solely for
this reason, or solely because the director or officer is present at or
participates in the meeting of the Board of Directors or committee thereof which
authorizes the contract or transaction, or solely because his or their votes are
counted for such purpose if (i) the material facts as to his or their
relationship or interest and as to the contract or transaction are disclosed or
are known to the Board of Directors or the committee, and the Board of Directors
or committee in good faith authorizes the contract or transaction by the
affirmative votes of a majority of the disinterested directors, even though the
disinterested directors be less than a quorum; or (ii) the material facts as to
his or their relationship or interest and as to the contract or transaction are
disclosed or are known to the shareholder entitled to vote thereon, and the
contract or transaction is specifically approved in good faith by vote of the
shareholders; or (iii) the contract or transaction is fair as to the Corporation
as of the time it is authorized, approved or ratified, by the Board of
Directors, a committee thereof or the shareholders. Common or interested
directors may be counted in determining the presence of a quorum at a meeting of
the Board of Directors or of a committee which authorizes the contract or
transaction.
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ARTICLE IV
OFFICERS
SECTION 1. General. The officers of the Corporation shall be chosen by
the Board of Directors and shall be a President, a Secretary and a Treasurer.
The Board of Directors, in its discretion, may also choose a Chairman of the
Board of Directors (who must be a director) and one or more Vice Presidents,
Assistant Secretaries, Assistant Treasurers and other officers. Any number of
offices may be held by the same person, unless otherwise prohibited by law, the
Certificate of Incorporation or these Bylaws. The officers of the Corporation
need not be stockholders of the Corporation nor, except in the case of the
Chairman of the Board of Directors, need such officers be directors of the
Corporation.
SECTION 2. Election. The Board of Directors at its first meeting held
after each annual meeting of stockholders shall elect the officers of the
Corporation who shall hold their offices for such terms and shall exercise such
powers and perform such duties as shall be determined from time to time by the
Board of Directors; and all officers of the Corporation shall hold office until
their successors are chosen and qualified, or until their earlier resignation or
removal. Any officer elected by the Board of Directors may be removed at any
time by the affirmative vote of a majority of the Board of Directors. Any
vacancy occurring in any office of the Corporation shall be filled by the Board
of Directors. The salaries of all officers who are directors of the Corporation
shall be fixed by the Board of Directors.
SECTION 3. Voting Securities Owned by the Corporation. Powers of
attorney, proxies, waivers of notice of meeting, consents and other instruments
relating to securities owned by the Corporation may be executed in the name of
and on behalf of the Corporation by the President or any Vice President and any
such officer may, in the name and on behalf of the Corporation, take all such
action as any such officer may deem advisable to vote in person or by proxy at
any meeting of security holders of any corporation in which the Corporation may
own securities and at any such meeting shall possess and may exercise any and
all rights and power incident to the ownership of such securities and which, as
the owner thereof, the Corporation might have exercised and possessed if
present. The Board of Directors may, by resolution, from time to time confer
like powers upon any other person or persons.
SECTION 4. Chairman of the Board of Directors. The Chairman of the
Board of Directors, if there be one, shall preside at all meetings of the
stockholders and of the Board of Directors. Except whereby law the signature of
the President is required, the Chairman of the Board of Directors shall possess
the same power as the President to sign all contracts, certificates and other
instruments of the Corporation which may be authorized by the Board of
Directors. During the absence or disability of the President, the Chairman of
the Board of Directors shall exercise all the powers and discharge all the
duties of the President. The Chairman of the Board of Directors shall also
perform such other duties and may exercise such other powers as from time to
time may be assigned to him by these Bylaws or by the Board of Directors.
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SECTION 5. President. The President shall, subject to the control of
the Board of Directors and, if there be one, the Chairman of the Board of
Directors, have general supervision of the business of the Corporation and shall
see that all orders and resolutions of the Board of Directors are carried into
effect. He shall execute all bonds, mortgages, contracts and other instruments
of the Corporation requiring a seal, under the seal of the Corporation, except
where required or permitted by law to be otherwise signed and executed and
except that the other officers of the Corporation may sign and execute documents
when so authorized by these Bylaws, the Board of Directors or the President. In
the absence or disability of the Chairman of the Board of Directors, or if there
be none, the President shall preside at all meetings of the stockholders and the
Board of Directors. The President shall also perform such other duties and may
exercise such other powers as from time to time may be assigned to him by these
Bylaws or by the Board of Directors.
SECTION 6. Vice Presidents. At the request of the President or in his
absence or in the event of his inability or refusal to act (and if there be no
Chairman of the Board of Directors), the Vice President or the Vice Presidents
if there is more than one (in the order designated by the Board of Directors)
shall perform the duties of the President, and when so acting, shall have all
the powers of and be subject to all the restrictions upon the President. Each
Vice President shall perform such other duties and have such other powers as
the Board of Directors from time to time may prescribe. If there be no
Chairman of the Board of Directors and no Vice President, the Board of
Directors shall designate the officer of the Corporation who, in the absence
of the President or in the event of the inability or refusal of the President
to act, shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President.
SECTION 7. Secretary. The Secretary shall attend all meetings of the
Board of Directors and all meetings of stockholders and record all the
proceedings thereat in a book or books to be kept for that purpose; the
Secretary shall also perform like duties for the standing committees when
required. The Secretary shall give, or cause to be given, notice of all
meetings of the stockholders and special meetings of the Board of Directors, and
shall perform such other duties as may be prescribed by the Board of Directors
or President, under whose supervision he shall be. If the Secretary shall be
unable or shall refuse to cause to be given notice of all meetings of the
stockholders and special meetings of the Board of Directors, and if there be no
Assistant Secretary, then either the Board of Directors or the President may
choose another officer to cause such notice to be given. The Secretary shall
have custody of the seal of the Corporation and the Secretary or any Assistant
Secretary, if there be one, shall have authority to affix the same to any
instrument requiring it and when so affixed, it may be attested by the signature
of the Secretary or by the signature of any such Assistant Secretary. The Board
of Directors may give general authority to any other officer to affix the seal
of the Corporation and to attest the affixing by his signature. The Secretary
shall see that all books, reports, statements, certificates and other documents
and records required by law to be kept or filed are properly kept or filed, as
the case may be.
SECTION 8. Treasurer. The Treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Corporation and shall
6
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deposit all moneys and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the Board of
Directors. The Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the President and the Board of Directors, at
its regular meetings, or when the Board of Directors so requires, an account of
all his transactions as Treasurer and of the financial condition of the
Corporation. If required by the Board of Directors, the Treasurer shall give
the Corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for the faithful performance of the
duties of his office and for the restoration to the Corporation, in case of his
death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the Corporation.
SECTION 9. Assistant Secretaries. Except as may be otherwise provided
in these Bylaws, Assistant Secretaries, if there be any, shall perform such
duties and have such powers as from time to time may be assigned to them by the
Board of Directors, the President, any Vice President, if there be one, or the
Secretary, and in the absence of the Secretary or in the event of his disability
or refusal to act, shall perform the duties of the Secretary, and when so
acting, shall have all the powers of and be subject to all the restrictions upon
the Secretary.
SECTION 10. Assistant Treasurers. Assistant Treasurers, if there be any,
shall perform such duties and have such powers as from time to time may be
assigned to them by the Board of Directors, the President, any Vice President,
if there be one, or the Treasurer, and in the absence of the Treasurer or in the
event of his disability or refusal to act, shall perform the duties of the
Treasurer, and when so acting, shall have all the powers of and be subject to
all the restrictions upon the Treasurer. If required by the Board of Directors,
an Assistant Treasurer shall give the Corporation a bond in such sum and with
such surety or sureties as shall be satisfactory to the Board of Directors for
the faithful performance of the duties of his office and for the restoration to
the Corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the Corporation.
SECTION 11. Controller. The Controller shall establish and maintain the
accounting records of the Corporation in accordance with generally accepted
accounting principles applied on a consistent basis, maintain proper internal
control of the assets of the Corporation and shall perform such other duties as
the Board of Directors, the President or any Vice President of the Corporation
may prescribe.
SECTION 12. Other Officers. Such other officers as the Board of Directors
may choose shall perform such duties and have such powers as from time to time
may be assigned to them by the Board of Directors. The Board of Directors may
delegate to any other officer of the Corporation the power to choose such other
officers and to prescribe their respective duties and powers.
7
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ARTICLE V
STOCK
SECTION 1. Form of Certificates. Every holder of stock in the
Corporation shall be entitled to have a certificate signed, in the name of the
Corporation (i) by the Chairman of the Board of Directors, the President or a
Vice President and (ii) by the Treasurer or an Assistant Treasurer, or the
Secretary or an Assistant Secretary of the Corporation, certifying the number of
shares owned by him in the Corporation.
SECTION 2. Signatures. Any or all of the signatures on the certificate
may be a facsimile, including, but not limited to, signatures of officers of the
Corporation and countersignatures of a transfer agent or registrar. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate shall have ceased to be such officer,
transfer agent or registrar before such certificate is issued, it may be issued
by the Corporation with the same effect as if he were such officer, transfer
agent or registrar at the date of issue.
SECTION 3. Lost Certificates. The Board of Directors may direct a new
certificate to be issued in place of any certificate therefore issued by the
Corporation alleged to have been lost, stolen or destroyed, upon the making of
an affidavit of that fact by the person claiming the certificate of stock to be
lost, stolen or destroyed. When authorizing such issue of a new certificate,
the Board of Directors may, in its discretion and as a condition precedent to
the issuance thereof, require the owner of such lost, stolen or destroyed
certificate, or his legal representative, to advertise the same in such manner
as the Board of Directors shall require and/or to give the Corporation a bond in
such sum as it may direct as indemnity against any claim that may be made
against the Corporation with respect to the certificate alleged to have been
lost, stolen or destroyed.
SECTION 4. Transfers. Stock of the Corporation shall be transferable
in the manner prescribed by law and in these Bylaws. Transfers of stock shall
be made on the books of the Corporation only by the person named in the
certificate or by his attorney lawfully constituted in writing and upon the
surrender of the certificate therefor, which shall be cancelled before a new
certificate shall be issued.
SECTION 5. Record Date. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or entitled to express consent to corporate action
in writing without a meeting, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board of Directors may fix, in advance,
a record date, which shall not be more than sixty days nor less than ten days
before the date of such meeting, nor more than sixty days prior to any other
action. A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.
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SECTION 6. Beneficial Owners. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and to hold liable
for calls and assessments a person registered on its books as the owner of
shares, and shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or not
it shall have express or other notice thereof, except as otherwise provided by
law.
ARTICLE VI
INDEMNIFICATION
SECTION 1. Subject to Section 3 of this Article VI, the Corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the Corporation or is or was serving at
the request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
---------------
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interest of the
Corporation, or, with respect to any criminal action or proceeding, had
reasonable cause to believe his conduct was unlawful.
SECTION 2. Subject to Section 3 of this Article VI, the Corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the right
of the Corporation to procure a judgment in its favor by reason of the fact that
he is or was a director, officer, employee or agent of the Corporation or is or
was serving at the request of the Corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Corporation; except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper.
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SECTION 3. Any indemnification under this Article VI (unless ordered by
a court) shall be made by the Corporation only as authorized in the specific
case upon a determination that indemnification of the director, officer,
employee, or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 1 or Section 2 of this
Article VI, as the case may be. Such determination shall be made (i) by the
Board of Directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or (ii) if such a quorum is
not obtainable, or, even if obtainable a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by the
stockholders. To the extent, however, that a director, officer, employee or
agent of the Corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding described in Section 1 or Section 2 of
this Article VI, or in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith, without the necessity of
authorization in the specific case.
SECTION 4. For purposes of any determination under Section 3 of this
Article VI, a person shall be deemed to have acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interest of the
Corporation, and, with respect to any criminal action or proceeding, to have had
no reasonable cause to believe his conduct was unlawful, if his action is based
on the records or books of account of the Corporation or another enterprise, or
on information supplied to him by the officers of the Corporation or another
enterprise in the course of their duties, or on the advice of legal counsel for
the Corporation or another enterprise or on information or records given or
reports made to the Corporation or another enterprise by an independent
certified public accountant or by an appraiser or other expert selected with
reasonable care by the Corporation or another enterprise. The term "another
enterprise" as used in this Section 4 of Article VI, shall mean any other
corporation or any partnership, joint venture, trust or other enterprise of
which such person is or was serving at the request of the Corporation as a
director, officer, employee or agent. The provisions of this Section 4 shall
not be deemed to be exclusive or to limit in any way the circumstances in which
a person may be deemed to have met the applicable standard of conduct set forth
in Section 1 or Section 2 of this Article VI as the case may be.
SECTION 5. Notwithstanding any contrary determination in the specific
case under Section 3 of this Article VI, and notwithstanding the absence of any
determination thereunder, any director, officer, employee or agent may apply to
any court of competent jurisdiction in the State of Delaware for indemnification
to the extent otherwise permissible under Section 1 and Section 2 of this
Article VI. The basis of such indemnification by a court shall be a
determination by such court that indemnification of the director, officer,
employee or agent is proper in the circumstances because he has met the
applicable standards of conduct set forth in Section 1 or Section 2 of this
Article VI, as the case may be. Notice of any application for indemnification
pursuant to this Section 5 of Article VI shall be given to the Corporation
promptly upon the filing of such application.
10
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SECTION 6. Expenses incurred in defending or investigating a threatened
or pending action, suit or proceeding may be paid by the Corporation in advance
of the final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of the director, officer, employee or agent to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Corporation as authorized in this Article VI.
SECTION 7. The indemnification and advancement of expenses provided by
this Article VI shall not be deemed exclusive of any other rights to which any
person seeking indemnification or advancement of expenses may be entitled under
any Bylaw, agreement, contract, vote of stockholders or disinterested directors
or pursuant to the direction (howsoever embodied) of any court of competent
jurisdiction or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, it being the policy of the
Corporation that indemnification of, and advancement of expenses to, the persons
specified in Section 1 and Section 2 of Article VI shall be made to the fullest
extent permitted by law. The provisions of this Article VI shall not be deemed
to preclude the indemnification of, and advancement of expenses to, any person
who is not specified in Section 1 or Section 2 of this Article VI but whom the
Corporation has the power or obligation to indemnify under the provisions of the
General Corporation Law of the State of Delaware, or otherwise. The
indemnification provided by this Article VI shall continue as to a person who
has ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such person.
SECTION 8. The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the Corporation would have the power or the obligation to
indemnify him against such liability under the provisions of this Article VI.
SECTION 9. For purposes of this Article VI, reference to "the
Corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
a consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, employees or
agents, so that any person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall stand
in the same position under the provisions of this Article VI with respect to the
resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
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ARTICLE VII
NOTICES
SECTION 1. Notices. Whenever written notice is required by law, the
Certificate of Incorporation or these Bylaws, to be given to any director,
member of a committee or stockholder, such notice may be given by mail,
addressed to such director, member of a committee or stockholder, at his address
as it appears on the records of the Corporation, with postage thereon prepaid,
and such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Written notice may also be given
personally or by telegram, telex or cable.
SECTION 2. Waivers of Notice. Whenever any notice is required by law,
the Certificate of Incorporation or these Bylaws, to be given to any director,
member of a committee or stockholder, a waiver thereof in writing, signed, by
the person or persons entitled to said notice, whether before or after the time
stated therein, shall be deemed equivalent thereto.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 1. Dividends. Dividends upon the capital stock of the
Corporation, subject to the provisions of the Certificate of Incorporation, if
any, may be declared by the Board of Directors at any regular or special
meeting, and may be paid in cash, in property, or in shares of the capital
stock. Before payment of any dividend, there may be set aside out of any funds
of the Corporation available for dividends such sum or sums as the Board of
Directors from time to time, in its absolute discretion, deems proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation, or for any proper
purpose, and the Board of Directors may modify or abolish any such reserve.
SECTION 2. Disbursements. All checks or demands for money and notes of
the Corporation shall be signed by such officer or officers or such other person
or persons as the Board of Directors may from time to time designate.
SECTION 3. Fiscal Year. The fiscal year of the Corporation shall end
on the Friday nearest December 31 and the following fiscal year shall commence
on the Saturday following the aforesaid Friday, unless the fiscal year is
otherwise fixed by affirmative resolution of the entire Board of Directors.*/
- --------------------
* On October 25, 1991, the Board of Directors of the Company adopted a
resolution changing the Company's fiscal year end to a calendar year
commencing with the year 1992.
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SECTION 4. Corporate Seal. The corporate seal shall have inscribed
thereon the name of the Corporation, the year of its organization and the words
"Corporate Seal, Delaware". The seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.
13
Exhibit 5
Latham & Watkins
885 Third Avenue, Suite 1000
New York, New York 10022
October 11, 1995
Harrah's Entertainment, Inc.
Harrah's Operating Company, Inc.
1023 Cherry Road
Memphis, Tennessee 38117
Re: Registration Statement No. 33-62783:
$200,000,000 Aggregate principal
Amount of Securities
-------------------------------------
Ladies and Gentlemen:
In connection with the registration of $200,000,000 aggregate
principal amount of (i) common stock, par value $0.10 per share (the
"Common Stock"), of Harrah's Entertainment, Inc., a Delaware corporation
("Harrah's Entertainment"), (ii) preferred stock, par value $0.10 per share
(the "Preferred Stock"), of Harrah's Operating Company, Inc., a Delaware
corporation ("Harrah's Operating"), and (iii) debt securities of Harrah's
Operating (the "Debt Securities" and, collectively with the Common Stock
and the Preferred Stock, the "Securities"), and the guarantee of the
Preferred Stock (the "Preferred Stock Guarantee") and the Debt Securities
(the "Debt Guarantee") by Harrah's Entertainment, under the Securities Act
of 1933, as amended (the "Act"), on Form S-3 filed with the Securities and
Exchange Commission (the "Commission") on September 20, 1995 (File No. 33-
62783), as amended by Amendment No. 1 filed with the Commission on October
11, 1995 (collectively, the "Registration Statement"), and the offering of
such Securities from time to time, as set forth in the prospectus contained
in the Registration Statement (the "Prospectus") and as to be set forth in
one or more supplements to the Prospectus (each a "Prospectus Supplement"),
you have requested our opinion with respect to the matters set forth below.
In our capacity as your special counsel in connection with such
registration, we are familiar with the proceedings taken and proposed to be
taken by Harrah's Entertainment and Harrah's Operating in connection with
the authorization and issuance of the Securities, the Preferred Stock
Guarantees and the Debt
<PAGE>
Harrah's Entertainment, Inc.
Harrah's Operating Company, Inc.
October 11, 1995
Page 2
Guarantee, respectively, and for the purposes of this opinion, have assumed
such proceedings will be timely completed in the manner presently proposed.
In addition, we have made such legal and factual examinations and
inquiries, including an examination of originals or copies, certified or
otherwise identified to our satisfaction, of such documents, corporate
records and instruments, as we have deemed necessary or appropriate for
purposes of this opinion.
In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals,
and the conformity to authentic original documents of all documents
submitted to us as copies.
We are opining herein as to the effect on the subject transaction
only of the internal laws of the State of New York and the General
Corporation Law of the State of Delaware, and we express no opinion with
respect to the applicability thereto, or the effect thereon, of the laws of
any other jurisdiction or, in the case of Delaware, any other laws, or as
to any matters of municipal law or the laws of any local agencies within
any state.
Capitalized terms used herein without definition have the
meanings ascribed to them in the Registration Statement.
Subject to the foregoing and the other matters set forth herein,
it is our opinion that as of the date hereof:
1. Harrah's Entertainment has authority pursuant to the its
Certificate of Incorporation to issue up to 360,000,000 shares of Common
Stock. Upon adoption by the Board of Directors of Harrah's Entertainment
of a resolution in form and content as required by applicable law and upon
issuance and delivery of and payment for such shares in the manner
contemplated by the Registration Statement and/or the applicable Prospectus
Supplement and by such resolution, the shares of Common Stock to be sold
pursuant to the Registration Statement and/or Prospectus Supplement will be
validly issued, fully paid and nonassessable.
2. Harrah's Operating has the authority pursuant to its
Certificate of Incorporation to issue up to 1,000,000 shares of Preferred
Stock. When a series of Preferred Stock has been duly established in
accordance with the terms of Harrah's
<PAGE>
Harrah's Entertainment, Inc.
Harrah's Operating Company, Inc.
October 11, 1995
Page 3
Operating's Certificate of Incorporation and applicable law, and upon
adoption by the Board of Directors of Harrah's Operating of a resolution in
form and content as required by applicable law and upon issuance and
delivery of and payment for such shares in the manner contemplated by the
Registration Statement and/or the applicable Prospectus Supplement and by
such resolution, such shares of such series of Preferred Stock will be
validly issued, fully paid and nonassessable.
3. The Debt Securities have been duly authorized by all
necessary corporate action of Harrah's Operating, and when the Debt
Securities have been duly established by an Indenture, and duly executed,
authenticated and delivered by or on behalf of Harrah's Operating against
payment therefor in accordance with the terms of an Indenture and as
contemplated by the Registration Statement and/or the applicable Prospectus
Supplement, the Debt Securities will constitute legally valid and binding
obligations of Harrah's Operating, enforceable against Harrah's Operating
in accordance with their terms.
4. The Debt Guarantee has been duly authorized by all necessary
corporate action of Harrah's Entertainment, and when the Guarantee has been
duly established by an Indenture, and duly executed in accordance with the
terms of an Indenture and upon due execution, authentication and delivery
of the Debt Securities and upon payment therefor, will be a legally valid
and binding obligation of Harrah's Entertainment.
5 The Preferred Stock Guarantee has been duly authorized by
all necessary corporate action of Harrah's Entertainment, and when (i) the
terms of the Preferred Stock Guarantee have been duly established in
accordance with applicable law, (ii) the instruments relating to the
Preferred Stock Guarantee have been duly authorized, executed and
delivered, and (iii) the shares of Preferred Stock to which any Preferred
Stock Guarantee relates have been duly issued and delivered, and payment
therefor has been received, in the manner contemplated by the Registration
Statement and/or the applicable Prospectus Supplement, the Preferred Stock
Guarantee will be a legally valid and binding obligation of Harrah's
Entertainment.
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Harrah's Entertainment, Inc.
Harrah's Operating Company, Inc.
October 11, 1995
Page 4
The opinions set forth above are subject to the following
exceptions, limitations and qualifications: (i) the effect of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other
similar laws now or hereafter in effect relating to or affecting the rights
and remedies of creditors; (ii) the effect of general principles of equity,
whether enforcement is considered in a proceeding in equity or at law, and
the discretion of the court before which any proceeding therefor may be
brought; (iii) the unenforceability under certain circumstances under law
or court decisions of provisions providing for the indemnification of or
contribution to a party with respect to a lability where such
indemnification or contribution is contrary to public policy; (iv) we
express no opinion concerning the enforceability of the waiver of rights or
defenses contained in Sections 515 and 1201 of each of the Indentures; (v)
we express no opinion with respect to whether acceleration of the Debt
Securities may affect the collectibility of that portion of the stated
principal amount thereof which might be determined to constitute unearned
interest thereon; and (vi) we express no opinion with respect to Article
XIII of the Senior Secured Debt Indenture or any other provision of the
Senior Secured Debt Indenture or the Senior Secured Debt Securities insofar as
they pertain to the Security Documents, the Bank Security Documents (each
as defined in the Senior Secured Debt Indenture), the security interests
contemplated thereby and the collateral subject thereto.
To the extent that the obligations of Harrah's Entertainment and
Harrah's Operating under the Indentures may be depended upon such matters,
we assume for purposes of this opinion that the Trustee is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization; that the Trustee is duly qualified to engage in the
activities contemplated by the Indentures; that each of the Indentures has been
duly authorized, executed and delivered by the Trustee and constitutes the
legally valid, binding and enforceable obligation of the Trustee
enforceable against the Trustee in accordance with its terms; that the
Trustee is in compliance, generally and with respect to acting as a trustee
under the Indentures, with all applicable laws and regulations; and that
the Trustee has the requisite organizational and legal power and authority
to perform its obligations under the Indentures.
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Harrah's Entertainment, Inc.
Harrah's Operating Company, Inc.
October 11, 1995
Page 5
This opinion is rendered only to you and is solely for your
benefit in connection with the transactions covered hereby. This opinion
may not be relied upon by you for any other purpose, or furnished to,
quoted to, or relied upon by any other person, firm or corporation for any
purpose, without our prior written consent.
We consent to your filing this opinion as an exhibit to the
Registration Statement and to the reference to our firm contained under the
heading "Legal Matters."
Very truly yours,
LATHAM & WATKINS
