<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
HARVEYS CASINO RESORTS
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
HARVEYS CASINO RESORTS
P.O. BOX 128
U.S. HIGHWAY 50 & STATELINE AVENUE
LAKE TAHOE, NEVADA 89449
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY L, 1997
To the Stockholders:
NOTICE is hereby given that the Annual Meeting of Stockholders (the "Annual
Meeting") of Harveys Casino Resorts (the "Company") will be held at Harveys
Resort Hotel/Casino, U.S. Highway 50 and Stateline Avenue, Lake Tahoe, Nevada
89449, on Thursday, May l, 1997 at 10:00 a.m. local time, for the following
purposes:
1. To elect three directors to serve for a term of three years until the
2000 Annual Meeting of Stockholders and until their respective successors
have been duly elected and qualified; and
2. To consider and transact such other business as may properly come before
the Annual Meeting or any adjournment thereof.
Holders of the Company's common stock, par value $.01 per share (the "Common
Stock"), at the close of business on March 14, 1997, the record date fixed by
the Company's board of directors (the "Board of Directors"), are entitled to
notice of and to vote at the Annual Meeting. The Board of Directors urges all
stockholders of record to exercise their right to vote at the meeting personally
or by proxy. Accordingly, we are sending you the following Proxy Statement and
the enclosed proxy card.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE SPECIFY YOUR
VOTE ON THE ACCOMPANYING PROXY CARD AND SIGN, DATE AND RETURN IT AS PROMPTLY AS
POSSIBLE IN THE ENCLOSED SELF-ADDRESSED, POSTAGE-PAID ENVELOPE.
Your prompt response will be appreciated.
By Order of the Board of Directors
CHARLES W. SCHARER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Lake Tahoe, Nevada
March 28, 1997
<PAGE>
HARVEYS CASINO RESORTS
P.O. BOX 128
U.S. HIGHWAY 50 & STATELINE AVENUE
LAKE TAHOE, NEVADA 89449
------------------------
PROXY STATEMENT
------------------
The accompanying proxy is solicited by the board of directors (the "Board of
Directors") of Harveys Casino Resorts (the "Company") to be used at the Annual
Meeting of Stockholders on Thursday, May 1, 1997 (the "Annual Meeting") to be
held at 10:00 a.m. local time at Harveys Resort Hotel/Casino, U.S. Highway 50
and Stateline Avenue, Lake Tahoe, Nevada. This Proxy Statement, the enclosed
form of proxy and the Annual Report to Stockholders are being sent to
stockholders on or about March 28, 1997.
At the Annual Meeting, stockholders will be asked to consider and vote upon
the following matter:
ITEM I: The election of three directors to serve until the 2000 Annual
Meeting.
Any stockholder giving a proxy may revoke it at any time prior to its
exercise at the Annual Meeting by giving notice of such revocation either
personally or in writing to the Secretary of the Company at the Company's
executive offices, by subsequently executing and delivering another proxy or by
voting in person at the Annual Meeting.
The Annual Report to Stockholders that accompanies this Proxy Statement is
not to be regarded as proxy soliciting material.
The Board of Directors believes that the election of its director nominees
is in the best interests of the Company and its stockholders and recommends to
the stockholders the approval of each of the nominees.
VOTING
Only holders of record at the close of business on March 14, 1997 (the
"Record Date") of the Company's common stock, $.01 par value (the "Common
Stock"), will be entitled to vote at the Annual Meeting. On the Record Date,
there were 9,822,209 shares of Common Stock outstanding. Each share of Common
Stock is entitled to one vote on all matters presented at the Annual Meeting.
Shares of Common Stock represented by duly executed and unrevoked proxies in
the enclosed form received by the Board of Directors will be voted at the Annual
Meeting in accordance with the specifications made therein by the stockholders,
unless authority to do so is withheld. If no specification is made, shares of
Common Stock represented by duly executed and unrevoked proxies in the enclosed
form will be voted FOR the election of all of the nominees listed herein and,
with respect to any other matter that may properly come before the meeting, in
the discretion of the persons voting the respective proxies.
The cost of preparing, assembling and mailing the proxy materials will be
borne by the Company. The Company has retained American Stock Transfer & Trust
Co. to solicit proxies at an estimated cost of $10,000.
VOTE REQUIRED
The election of the director nominees requires a plurality of the votes cast
in person or by proxy at the Annual Meeting. Under Nevada law, the Company's
Restated Articles of Incorporation and the Company's Bylaws, shares as to which
a stockholder abstains or withholds from voting on the election of directors and
shares as to which a broker indicates that it does not have discretionary
authority to vote ("broker non-votes") on the election of directors will not be
counted as voting thereon and therefore will not affect the election of the
nominees receiving a plurality of the votes cast.
The stockholders of the Company have no dissenters' or appraisal rights in
connection with Item I.
<PAGE>
ITEM I
NOMINEES FOR ELECTION OF DIRECTORS
The Company's Restated Articles of Incorporation and Bylaws currently set
the number of directors on the Board of Directors at nine (9) and provide that
the number of directors may from time to time be decreased to not less than
three (3) or increased by amending the Bylaws. The Board of Directors presently
consists of the following persons: Richard F. Kudrna, Sr., William B. Ledbetter,
Thomas M. Yturbide, Jessica L. Ledbetter, Kirk B. Ledbetter, Luther Mack, Jr.,
Franklin K. Rahbeck, Eugene R. White and Charles W. Scharer. The Board is
staggered into three classes, with each class consisting of three members. Class
I consists of Mr. Kudrna, Ms. Ledbetter and Mr. Rahbeck, whose terms expire in
1998. Class II consists of Mr. W. Ledbetter, Mr. K. Ledbetter and Mr. White,
whose terms expire in 1999. Class III consists of Mr. Scharer, Mr. Mack and Mr.
Yturbide whose terms expire in 1997. At each annual meeting, the terms of three
directors expire and director nominees are elected to the Board of Directors for
terms of three years.
Mr. Yturbide has advised the Company that he will not seek an additional
term on the Board of Directors and has resigned effective May 1, 1997. The Board
of Directors has unanimously elected Charles W. Scharer to succeed Mr. Yturbide
as Chairman of the Board. Mr. Scharer will also retain his position as President
and Chief Executive Officer. The Board of Directors has unanimously nominated
Ronald R. Zideck, Managing Partner for the Reno office of Grant Thornton LLP, an
international firm of accountants and management consultants, as a nominee for
the seat on the Board of Directors to be vacated by Mr. Yturbide.
At the Annual Meeting, three directors are to be elected to serve until the
2000 Annual Meeting and until their successors are elected and qualified. Unless
authority to vote for directors is withheld in the proxy card, it is the
intention of the persons named in the enclosed form of proxy to vote FOR the
election of the three nominees listed below. The persons designated as proxies
will have discretion to cast votes for other persons in the event any nominee
for director is unable to serve. At present, it is not anticipated that any
nominee will be unable to serve. Due to existing management responsibilities in
his firm through the firm's July 31, 1997 fiscal year-end, Mr. Zideck will begin
his service on August 1, 1997 if elected.
The names and certain information concerning the persons to be nominated as
directors by the Board of Directors at the annual meeting are set forth below.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF THE NOMINEES
LISTED BELOW.
CHARLES W. SCHARER. Mr. Scharer was elected President and Chief Executive
Officer effective December 1, 1995. He has served as a Director since April
1995. Prior to becoming President and Chief Executive Officer, Mr. Scharer
served as Executive Vice President from August 1995. Mr. Scharer was elected
Chief Financial Officer in July 1993 and Treasurer in September 1993. Mr.
Scharer, a Certified Public Accountant, joined the Company in 1982 as Audit
Manager. He received progressive promotions to Corporate Director of Internal
Control in 1983, to Assistant General Manager in 1985, to Director of Cashier
Operations in 1988 and to Vice President Finance and Administration in December
1988.
LUTHER MACK, JR. Mr. Mack joined the Company's Board of Directors in August
1994. A respected business and civic leader in the Reno-Sparks area, Mr. Mack
has been an owner-operator of several McDonalds's franchises for over 20 years.
He is also the President and Chief Executive Officer of the Nevada Television
Corporation. Mr. Mack is a member of the board of the Nevada State Athletic
Commission and the Reno-Tahoe International Airport, as well as director and
member of the audit committee for Pioneer Citizens Bank of Nevada.
RONALD R. ZIDECK. Mr. Zideck is a Certified Public Accountant with more than
30 years of public accounting experience and, for the past 15 years, has been
Managing Partner for the Reno office of Grant Thornton LLP, an international
firm of accountants and management consultants. Mr. Zideck has served on Grant
Thornton LLP's National Executive Committee for the past six years. He is a
member of the
2
<PAGE>
University of Nevada's College of Business Advisory Board, is a founding board
member and past president of the University's Accounting Circle, and is chairman
of the University's Legislative Steering Committee. Mr. Zideck currently serves
as a board member and the treasurer for the Utility Shareholders' Association of
Nevada, as a board member of Saint Mary's Health Network and as a trustee of the
Economic Development Authority of Western Nevada. Previously, he served on the
boards of the Reno Philharmonic and the Nevada Museum of Art. Mr. Zideck is a
past president of Western Industrial Nevada and past chairman of the Greater
Reno-Sparks Chamber of Commerce.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the directors, director nominee and executive
officers of the Company as of February 28,1997. All directors hold their
positions until their terms expire or until their respective successors are
elected and have qualified. Executive officers are elected by and serve at the
discretion of the Board of Directors until their successors are duly chosen and
have qualified.
<TABLE>
<CAPTION>
NAME AGE TITLE
- --------------------------- --- ------------------------------------------------------------------------------
<S> <C> <C>
Thomas M. Yturbide......... 61 Chairman of the Board of Directors
William B. Ledbetter....... 66 Vice Chairman of the Board of Directors and Secretary
Charles W. Scharer......... 41 President, Chief Executive Officer and Director
Richard F. Kudrna, Sr...... 63 Chairman Emeritus and Director
Jessica L. Ledbetter....... 41 Director
Kirk B. Ledbetter.......... 37 Director
Luther Mack, Jr............ 57 Director
Franklin K. Rahbeck........ 74 Director
Eugene R. White............ 65 Director
Ronald R. Zideck........... 59 Director Nominee
Stephen L. Cavallaro....... 39 Chief Operating Officer of Subsidiary Properties
Gary D. Armentrout......... 49 Senior Vice President of Business Development and Government Relations
John J. McLaughlin......... 41 Senior Vice President, Chief Financial Officer and Treasurer
Edward B. Barraco.......... 52 Senior Vice President and General Manager - Harveys Wagon Wheel Hotel/Casino
Gary R. Selesner........... 43 Senior Vice President and General Manager - Hard Rock Hotel and Casino
Kevin O. Servatius......... 44 Senior Vice President and General Manager - Harveys Resort Hotel/ Casino
Verne H. Welch, Jr......... 59 Senior Vice President and General Manager - Harveys Casino Hotel
James J. Rafferty.......... 41 Corporate Vice President of Marketing
</TABLE>
Set forth below are the Class I and Class II directors whose terms do not
expire this year and executive officers of the Company, along with certain
information regarding these individuals.
RICHARD F. KUDRNA, SR. Mr. Kudrna served as Chairman of the Board of
Directors from 1983 until December 1, 1995, when he became Chairman Emeritus of
the Board of Directors. Mr. Kudrna's current term as a member of the Board of
Directors will expire at the 1998 Annual Meeting of Stockholders. Prior to
joining the Company in 1968, he had been employed by Harrah's for over 4 years.
Mr. Kudrna served as Sr. Vice President of Administration, then as Sr. Vice
President and General Manager before assuming the position of Chairman of the
Board. Mr. Kudrna is a past board member of the Lake Tahoe Gaming Alliance, past
director of the Lake Tahoe Visitors Authority and charter member and past
president of the Douglas County Education Foundation. Mr. Kudrna has also served
as past board president of the Tahoe Douglas Rotary Club, past president of the
Tahoe Douglas Chamber of Commerce and a member of the Douglas County Planning
Committee. He currently sits on the Advisory Board for the University of
Nevada-Reno Business College.
3
<PAGE>
JESSICA L. LEDBETTER. Ms. Ledbetter served as Executive Assistant from 1988
to 1993 and has served as a Director since 1987. Ms. Ledbetter's current term as
a member of the Board of Directors will expire at the 1998 Annual Meeting of
Stockholders. Ms. Ledbetter has been employed by the Company in a variety of
capacities, including internal audit, accounting and cashier functions, Director
of Planning, games and slot operations and food and beverage service. She
currently serves as a member of the Board of Directors of Barton Memorial
Hospital, Lake Tahoe Community Trust and the Lake Tahoe Education Foundation.
Ms. Ledbetter presently owns and operates the Thunderbird Ranch in northern
Nevada. Ms. Ledbetter is the daughter of William B. Ledbetter and the sister of
Kirk B. Ledbetter.
FRANKLIN K. RAHBECK. Mr. Rahbeck has served as a Director since 1987. Mr.
Rahbeck's current term as a Director will expire at the 1998 Annual Meeting of
Stockholders. He also serves on the Board of Directors of Barton Memorial
Hospital Foundation and is a director for the Washoe Tribe's Economic
Development Corporation. In 1947, Mr. Rahbeck founded the Nevada Lumber Company,
which he operated until its sale to Diamond International in 1959. He is the
co-founder of the Outdoorsman retail store in South Lake Tahoe which he managed
for a period of 23 years until 1983. Mr. Rahbeck currently resides in Carson
Valley where he engages in cattle ranching.
WILLIAM B. LEDBETTER. Mr. Ledbetter has served as Vice Chairman of the Board
of Directors and Secretary since October 1993. His current term as a Director
will expire at the 1999 Annual Meeting of Stockholders. From 1983 until October
1993, Mr. Ledbetter served as President, Chief Executive Officer and as a
Director. Since joining the Company in 1954, he has been involved in virtually
every aspect of the Company's operations. Mr. Ledbetter was instrumental in
developing the Company's present management team. From 1984 to 1991, he was
intimately involved in overseeing the completion of the Company's master plan.
Mr. Ledbetter is the father of Jessica L. and Kirk B. Ledbetter.
KIRK B. LEDBETTER. Mr. Ledbetter has served as a Director since 1987. His
current term as a Director will expire at the 1999 Annual Meeting of
Stockholders. He has been with the Company since 1977 and over the last 20 years
has obtained a wide range of experience in various functional systems and
customer service areas. He was appointed to the position of Customer Services
Systems Manager in 1993. In his current capacity he has responsibility for the
customer database, direct mail marketing, analysis of customer service ratings
and various marketing functions. He presently is the president and member of the
Board of Trustees for the Douglas County Education Foundation, was formerly a
member of the board of the Boys and Girls Club of Lake Tahoe and is active in
community service, sitting on various committees. Mr. Ledbetter holds B. S. and
MBA degrees from the University of Nevada-Reno. Mr. Ledbetter is the son of
William B. Ledbetter and brother of Jessica L. Ledbetter.
EUGENE R. WHITE. Mr. White was appointed to the Board of Directors in
November 1996. His current term as a Director will expire at the 1999 Annual
Meeting of Stockholders. Mr. White serves as Chairman of the Board of Antares
Alliance Group, a joint venture between EDS and Amdahl Corporation for the
development and marketing of software products. Mr. White is also a member of
the board of Needham and Company, Inc., a New York investment banking firm;
Varco International, Inc., an oil service company and Tyecin Systems, Inc., a
software systems company. Mr. White also serves as a trustee of JAIMS (Japan-
American Institute of Management Science) and as a consultant to the President
and Chairman of Fujitsu Limited of Japan.
STEPHEN L. CAVALLARO. Mr. Cavallaro was appointed Chief Operating Officer of
Subsidiary Properties in February 1996. In this position Mr. Cavallaro has
operational responsibility for Harveys Wagon Wheel Hotel/Casino in Central City,
Colorado; Harveys Casino Hotel in Council Bluffs, Iowa; and the Hard Rock Hotel
and Casino in Las Vegas, Nevada. Mr. Cavallaro joined the Company in February
1994 to direct and develop the Hard Rock Hotel and Casino as Senior Vice
President and General Manager - Hard Rock Hotel. From 1992 to 1994, Mr.
Cavallaro served as Vice President and General Manager of the Palace Station
Hotel/Casino. Mr. Cavallaro also served as Executive Vice President and General
Manager of Maloof Companies from 1990 to 1992.
4
<PAGE>
GARY D. ARMENTROUT. Mr. Armentrout has served as Senior Vice President of
Business Development and Government Relations since May 1995. In this position
he is responsible for identifying and pursuing the development of new projects.
Prior to joining the Company, Mr. Armentrout was employed by President Riverboat
Casinos, Inc. where he served as Vice President-Gaming from May 1990 until June
1994 when he became Vice President-Gaming Development, a position he held until
May 1995. From 1984 until 1990, Mr. Armentrout was Vice President and Assistant
General Manager for Harrah's Las Vegas.
JOHN J. MCLAUGHLIN. Mr. McLaughlin was elected Senior Vice President, Chief
Financial Officer and Treasurer in March 1996. Mr. McLaughlin joined the Company
in September 1995 as Chief Financial Officer. Mr. McLaughlin is a Certified
Public Accountant with over 16 years experience in the gaming industry and
served most recently as Chief Financial Officer of President Riverboat Casinos,
Inc. from January 1993 until September 1995. From 1984 until 1993, Mr.
McLaughlin was employed by TropWorld Casino and Entertainment Resort in Atlantic
City, where he served as Director of Financial Reporting from 1984 to 1986 and
then as Executive Director of Finance until 1993.
EDWARD B. BARRACO. Mr. Barraco has served as Senior Vice President and
General Manager-Harveys Wagon Wheel Hotel/Casino since July 1995. Mr. Barraco
joined the Company in 1971 and has over 29 years experience in the gaming and
hospitality industry. From 1985 to 1995, Mr. Barraco served as Assistant General
Manager-Lake Tahoe, where he was responsible for overseeing all aspects of the
operation on an assigned shift.
GARY R. SELESNER. Mr. Selesner was appointed Senior Vice President and
General Manager-Hard Rock Hotel and Casino in March 1996. Previously, Mr.
Selesner had served as Senior Vice President and General Manager-Maryland since
August 1995 where he was involved in the Company's development activities. Prior
to joining the Company, Mr. Selesner was Vice President-Sales and Marketing of
President Riverboat Casinos, Inc. from 1992 to August 1995. From July 1986 to
March 1991, Mr. Selesner was employed by the Trump Plaza Hotel and Casino in
Atlantic City, New Jersey where he served as Vice President of Marketing until
November 1988 and Executive Vice President until May 1990 when he became
President and Chief Operating Officer.
KEVIN O. SERVATIUS. Mr. Servatius was appointed Senior Vice President and
General Manager-Harveys Resorts Hotel/Casino in August 1995. Mr. Servatius has
over 16 years of experience in the gaming and hospitality industry. He started
his career with Harrah's where he progressed through the ranks of both the
Harrah's and Embassy Suites organizations, becoming Senior Vice President and
General Manager of Harrah's-Lake Tahoe in March 1993. He is a member of the Lake
Tahoe Visitors Authority and board member of the Lake Tahoe Gaming Alliance.
VERNE H. WELCH, JR. Mr. Welch has served as Senior Vice President and
General Manager-Harveys Casino Hotel since September 1995. Mr. Welch joined the
Company in 1987 and has over 23 years of experience in the gaming and
hospitality industry. Prior to moving to the Council Bluffs property, Mr. Welch
served as Senior Vice President and General Manager-Lake Tahoe from December
1993. From 1988 to December 1993, he served as Vice President-Casino Operations.
JAMES J. RAFFERTY. Mr. Rafferty was appointed Corporate Vice President of
Marketing in December 1995. Mr. Rafferty joined the Company in 1988 and has over
18 years of experience in the gaming and hospitality industry, including
management positions in the Las Vegas and Atlantic City markets. Mr. Rafferty
served as Vice President, Marketing-Lake Tahoe from 1992 to 1995. From 1988
through 1992, he served as Director of Employee Development.
MEETINGS OF THE BOARD OF DIRECTORS
During fiscal year 1996, the Board of Directors met on 10 occasions. None of
the members of the Board of Directors proposed for re-election attended less
than 75% of the meetings of the Board of
5
<PAGE>
Directors held during fiscal year 1996 or of the meetings of committees of the
Board of Directors on which such member served during fiscal year 1996.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors has established an Audit Committee and a Compensation
Committee. The functions of the Audit Committee are to recommend annually to the
Board of Directors the appointment of the independent public accountants of the
Company, discuss and review the scope and the fees of the prospective annual
audit and review the results thereof with the independent public accountants,
review and approve non-audit services of the independent public accountants,
review compliance with existing major accounting and financial policies of the
Company, review the adequacy of the financial organization of the Company and
review management's procedures and policies relative to the adequacy of the
Company's internal accounting controls. The current members of the Audit
Committee are Luther Mack, Jr. (chair), Franklin K. Rahbeck, and Eugene R.
White. During fiscal year 1996, the Audit Committee met on five occasions.
The functions of the Compensation Committee are to set compensation ranges
for the Company; review annual salaries and bonuses for all executive officers;
review and approve the annual salary and bonus for the President and Chief
Executive Officer and review, approve and recommend to the Board of Directors
the terms and conditions of all employee benefit plans or changes thereto. The
current members of the Compensation Committee are Eugene R. White (chair),
Jessica L. Ledbetter, Luther Mack, Jr., Richard F. Kudrna, Sr., William B.
Ledbetter and Franklin K. Rahbeck. During fiscal year 1996, the Compensation
Committee met on six occasions.
COMPENSATION OF DIRECTORS
In fiscal 1996, non-employee directors received an annual retainer of
$30,000 and an additional $1,000 for each board meeting attended. During such
period, non-employee committee members received $1,000 for each committee
meeting attended, and the non-employee chairs of each of the Audit Committee and
the Compensation Committee received $1,200 for each meeting attended.
Non-employee directors are reimbursed for expenses incurred in connection with
attending meetings of the Board of Directors and Committees thereof.
Non-employee directors are eligible to participate in the Non-employee Directors
Stock Option Program. See "--1993 Non-Employee Directors Stock Option Program."
The Company has established an Outside Directors' Retirement Plan pursuant
to which each outside director and any employee-director who is not covered
under the Company's Supplemental Executive Retirement Plan or Senior
Supplemental Executive Retirement Plan and who has served five or more years or
his/her beneficiaries, as applicable, shall be entitled to receive $25,000 per
year for up to ten years upon such director's retirement, death or disability.
The plan also provides for continuing medical insurance coverage under the
Company's executive health plan for a period of up to 10 years.
Directors who are also employees may be eligible to participate in the
Incentive Plans. See "--Em-
ployee Benefit Plans--Omnibus Incentive Plans."
HONORARY DIRECTOR PROGRAM
The Company's Honorary Director Program is a special program designed to
compensate Vera Gross for her years of service to the Company. Vera Gross served
as Executive Assistant and Director of the Company. She contributed over 25
years of service to the Company. Under the Honorary Director Program, for the
duration of her life, Mrs. Gross will receive annual payments of $50,000 and
benefits under the Company's Group Health Plan.
6
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The following individuals served on the Compensation Committee during fiscal
year 1996: Donald D. Snyder (chair, December 1, 1995 through April 25, 1996),
Jessica L. Ledbetter, Luther Mack, Jr., and Franklin K. Rahbeck. Thomas M.
Yturbide and Richard F. Kudrna, Sr. (chair, April 26, 1996 through November 30,
1996) participated as non-voting members. During fiscal year 1996, Richard F.
Kudrna, Sr. served as Director Emeritus of the Company and Thomas M. Yturbide
served as the Company's Chairman of the Board.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's executive officers and directors and
persons who own more than 10% of the Company's Common Stock to file reports of
ownership on Forms 3, 4 and 5 with the Commission. Executive officers, directors
and 10% stockholders are required by the Securities and Exchange Commission to
furnish the Company with copies of all Forms 3, 4 and 5 they file.
Based solely on the Company's review of the copies of such forms it has
received, the Company believes that all its executive officers, directors and
greater than 10% beneficial owners complied with all the filing requirements
applicable to them with respect to transactions during fiscal 1996 with the
exception of one late filing of a Form 4 reporting one sale of the Company's
Common Stock by Donald D. Snyder.
LEGAL PROCEEDINGS INVOLVING DIRECTORS, OFFICERS, AFFILIATES OR BENEFICIAL OWNERS
No director, officer or affiliate of the Company or beneficial owner of more
than 5% of the outstanding shares of Common Stock ("Beneficial Owner"), or any
associate thereof, is a party adverse to the Company or any of its subsidiaries
in any lawsuit nor has a material adverse interest thereto.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
PRINCIPAL STOCKHOLDERS
The following table sets forth as of March 14, 1997 certain information
regarding the shares of Common Stock beneficially owned by each stockholder who
is known by the Company to beneficially own in excess of 5% of the outstanding
shares of Common Stock, by each director, director nominee and Named Executive
Officer (as hereinafter defined) and by all executive officers and directors as
a group.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF BENEFICIAL OWNER(1) NUMBER(2) PERCENT OF CLASS (2)
- ----------------------------------------------------------------------- ---------- ---------------------
<S> <C> <C>
Estate of Beverlee A. Ledbetter, deceased (3).......................... 2,924,392 29.8
Kirk B. Ledbetter (3) (4).............................................. 3,561,392 36.3
Jessica L. Ledbetter (3) (5)........................................... 3,457,088 35.2
William B. Ledbetter (3) (6)........................................... 2,939,442 29.9
Richmont Capital Partners I, L.P....................................... 763,300 7.8
4300 Westgrove
Dallas, Texas 75248 (8)
FMR Corp............................................................... 745,500 7.6
82 Devonshire Street
Boston, Massachusetts 02109 (9)
Wells Fargo Bank, National Association................................. 694,000 7.1
P. O. Box 30100
Reno, Nevada 89520-0010 (7)
Dimensional Fund Advisors Inc.......................................... 497,100 5.1
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401 (9)
Thomas M. Yturbide (10)................................................ 231,667 2.3
Richard F. Kudrna, Sr. (6)(11)......................................... 58,550 *
Charles W. Scharer (10)................................................ 90,000 *
Stephen L. Cavallaro (10).............................................. 45,000 *
Kevin O. Servatius (10)................................................ 25,000 *
Franklin K. Rahbeck (5)................................................ 14,500 *
Luther Mack, Jr. (5)................................................... 4,700 *
Eugene R. White........................................................ -- *
Ronald R. Zideck....................................................... -- *
Executive Officers and Directors as a Group............................ 4,717,389 46.1
(17 persons)(3)(4)(5)(6)(10)(11)
</TABLE>
- ------------------------
* Less than one percent
(1) Unless otherwise indicated, the address of each of the stockholders named in
this table is: c/o Harveys Casino Resorts, P.O. Box 128, Highway 50 &
Stateline Avenue, Lake Tahoe, Nevada 89449.
(2) Unless otherwise indicated in the footnotes to this table and subject to the
community property laws where applicable, each of the stockholders named in
this table has sole voting and investment power with respect to the shares
shown as beneficially owned. Percentages of beneficial ownership total more
than one hundred percent because shares of Common Stock held by the Estate
of Beverlee A. Ledbetter deceased, are reported as beneficially owned by
each of Kirk B. Ledbetter, Jessica L. Ledbetter and William B. Ledbetter.
(3) Includes the 2,924,392 shares held by the Estate of Beverlee A. Ledbetter,
deceased. Kirk B. Ledbetter, Jessica L. Ledbetter and William B. Ledbetter
have been appointed co-executors of the estate and share the voting power
and investment power of the shares held by the estate, subject to
8
<PAGE>
such rights and restrictions imposed under the terms of the governing estate
instruments and the applicable state law.
(4) Includes 200 shares owned by Kirk B. Ledbetter's spouse and 100 shares each
controlled by Mr. Ledbetter's spouse as custodian for their son and
daughter. Kirk B. Ledbetter disclaims beneficial ownership of all 400
shares.
(5) Includes, in respect to each of Jessica L. Ledbetter and Franklin K.
Rahbeck, options to purchase 6,500 shares of Common Stock, and in respect to
Luther Mack, Jr., options to purchase 4,000 shares of Common Stock, all
granted under the terms of the Company's 1993 Non-Employee Directors Stock
Option Program, which options are currently exercisable or are exercisable
within 60 days.
(6) Includes the following options to purchase shares of Common Stock granted
under the terms of employment contracts, which options are currently
exercisable: William B. Ledbetter, 15,000 and Richard F. Kudrna, Sr.,
12,500.
(7) All shares are held by Wells Fargo Bank, N.A., as Trustee of; 1) The
Ledbetter 1993 Irrevocable Trust (572,400 shares); 2) the Gregory Lou Kudrna
Trust (60,800 shares) and, 3) the Richard Frank Kudrna, Jr. Trust (60,800
shares). The beneficial interests in the Ledbetter 1993 Irrevocable Trust
are divided into two equal shares between Jessica L. Ledbetter and Kirk B.
Ledbetter. The shares will be distributed to the beneficiaries on the fourth
anniversary of the death of William B. Ledbetter. Wells Fargo Bank, N. A.
has sole voting power for all 694,000 shares.
(8) Represents shares beneficially owned as of December 4, 1996, based on
Amendment No. 1 to Schedule 13D filed in December 1996, with the Securities
and Exchange Commission.
(9) Represents shares beneficially owned as of December 31, 1996, based on a
Schedule 13G filed with the Securities and Exchange Commission in February
1997.
(10) Includes those restricted shares of Common Stock awarded under the terms of
the Company's Omnibus Incentive Plans in the following amounts: Stephen L.
Cavallaro, 15,000; Charles W. Scharer, 18,000; Kevin O. Servatius , 15,000;
Thomas M. Yturbide, 55,000; and, to all officers and directors as a group
163,000. Recipients of such shares have immediate power to vote all such
shares; however, ownership of such shares is subject to restrictions which
lapse as to 25% on the date of grant of such shares and on each of the
following three anniversaries of the grant date. Includes the following
options to purchase shares of Common Stock awarded under the terms of the
Company's Omnibus Incentive Plans, which options are currently exercisable
or are exercisable within 60 days: Stephen L. Cavallaro, 33,333; Charles W.
Scharer, 72,000; Kevin O. Servatius, 10,000; Thomas M. Yturbide, 176,667;
and, to all officers and directors as a group, 367,501.
(11) Includes 39,000 shares owned by Richard F. Kudrna, Sr.'s spouse. Mr. Kudrna
disclaims beneficial ownership of all 39,000 shares.
9
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid or accrued by the
Company to the Chief Executive Officer of the Company and to each of the four
most highly compensated executive officers of the Company (other than the Chief
Executive Officer) for services rendered to the Company in all capacities during
the last three fiscal years ended November 30, 1996 (the five individuals are
referred to herein as the "Named Executive Officers").
HARVEYS CASINO RESORTS
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------
AWARDS
------------------------ PAYOUTS
RESTRICTED ---------
ANNUAL COMPENSATION STOCK LTIP ALL OTHER
------------------------- AWARDS ($) PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION FISCAL YEAR SALARY ($) BONUS ($) (1) OPTIONS (#) ($) (2) ($) (3) (4)
- --------------------------------- ----------- ----------- ------------ ----------- ----------- --------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Charles W. Scharer (6)........... 1996 347,400 168,000 -- 135,000 -- 4,095
President, Chief Executive 1995 240,507 125,000 -- -- -- 1,819
Officer and Director 1994 184,712 60,000 252,000 32,000 134,364 664
Thomas M. Yturbide (7)........... 1996 400,000 -- -- 100,000 -- 41,146
Chairman of the Board 1995 400,000 148,000(5) -- -- -- 34,074
1994 350,000 241,300(5) 770,000 110,000 361,206 22,801
William B. Ledbetter............. 1996 239,274 -- -- -- -- 11,552
Vice Chairman of the 1995 239,274 -- -- -- -- 11,787
Board and Secretary 1994 239,274 -- -- -- -- 11,588
Stephen L. Cavallaro (8)......... 1996 267,785 120,000 -- 28,000 -- 3,873
Chief Operating Officer of 1995 242,135 124,020 -- -- -- 1,777
Subsidiary Properties 1994 173,077 45,000 210,000 30,000 -- 393
Kevin O. Servatius (9)........... 1996 231,538 100,000 -- 10,000 -- 260
Sr. Vice President and 1995 60,577 7,500 285,000 30,000 -- --
General Manager 1994 -- -- -- -- -- --
Harveys Resort
</TABLE>
- ------------------------
(1) In the case of Mr. Scharer, Mr. Yturbide and Mr. Cavallaro, represents the
market value ($14 per share) as of February 14, 1994 (the effective date of
the Company's initial public offering) of restricted stock awarded the Named
Executive Officers pursuant to the 1993 Omnibus Incentive Plan. The number
of shares awarded and the value as of November 30, 1996 are as follows: Mr.
Scharer, 18,000 shares ($303,750), Mr. Yturbide, 55,000 shares ($928,125);
and Mr. Cavallaro, 15,000 shares ($253,125). The shares vested, immediately
as to 25% of the award on February 14, 1994, 25% on November 12, 1994, 25%
on November 12, 1995 and the remaining 25% on November 12, 1996. In the case
of Mr. Servatius, represents the market value ($19 per share) as of August
14, 1995 of 15,000 shares of restricted stock awarded to Mr. Servatius
pursuant to the 1993 Omnibus Incentive Plan. The value as of November
30,1996 was $253,125. The shares vested immediately as to 25% of the award
on August 14, 1995, 25% on August 14, 1996 and the remaining shares will
vest as to 25% on each of the next two anniversaries of the date of grant.
The Named Executive Officers receive dividends on all of their shares. See
"Employee Benefit Plans--Omnibus Incentive Plans."
10
<PAGE>
(2) In 1990, the Company adopted a long-term incentive plan for key employees.
Payment of incentives under the plan was contingent upon the Company
attaining certain financial objectives over consecutive and concurrent
three-year periods. In 1993, the Company terminated the plan and in 1994
paid all participants, including the Named Executive Officers, all
incentives earned. In 1994, the Company adopted a new long-term incentive
plan for key employees. See "--Long-Term Incentive Plans-- Awards in Fiscal
Year 1996" below.
(3) Includes for fiscal year 1994, $644, $20,611, $393 and $2,848 of the above
market interest earned by Mr. Scharer, Mr Yturbide, Mr. Cavallaro and Mr.
Ledbetter, respectively, on deferred compensation. Includes for fiscal year
1995, $1,819, $31,884, $1,777 and $3,047 of above market interest earned by
Mr. Scharer, Mr Yturbide, Mr. Cavallaro and Mr. Ledbetter, respectively, on
deferred compensation. Includes for fiscal year 1996, $2,965, $38,023,
$3,873, $2,812 and $260 of above market interest earned by Mr. Scharer, Mr.
Yturbide, Mr. Cavallaro, Mr. Ledbetter and Mr. Servatius, respectively, on
deferred compensation.
(4) Includes for fiscal 1994 and 1995, $2,190 and $8,740 of term life insurance
premium payments by the Company for policies insuring the lives of Mr.
Yturbide and Mr. Ledbetter, respectively. Includes for fiscal year 1996,
$1,130, $3,123 and $8,740 of term life insurance premium payments by the
Company for policies insuring the lives of Mr. Scharer, Mr. Yturbide and Mr.
Ledbetter, respectively.
(5) Includes a $100,000 signing bonus paid by the Company in connection with Mr.
Yturbide's employment contract.
(6) As of December 1, 1995, Mr. Scharer became the Company's President and Chief
Executive Officer.
(7) As of December 1, 1995, Mr. Yturbide became the Company's Chairman of the
Board of Directors.
(8) As of February 1, 1996, Mr. Cavallaro became Chief Operating Officer of
Subsidiary Operations.
(9) As of August 14, 1995 Mr. Servatius became Senior Vice President and General
Manager-Harveys Resort Hotel/Casino
OPTIONS
The tables below set forth certain information regarding options granted to
the Named Executive Officers during fiscal 1996.
OPTIONS GRANTED IN FISCAL YEAR 1996
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF PERCENT OF ANNUAL RATES OF STOCK
SHARES TOTAL OPTIONS PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM
OPTIONS GRANTED EMPLOYEES IN BASE PRICE EXPIRATION ---------------------
NAME (1) FISCAL YEAR ($/SHARE) DATE 5% ($) 10% ($)
- --------------------------------- --------------- --------------- ----------- ----------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Charles W. Scharer............... 100,000 24.54 18.625 12/01/05 601,203 2,060,535
35,000 8.59 19.250 07/25/06 423,718 1,073,784
Thomas M. Yturbide............... 100,000 24.54 18.625 12/01/05 601,203 2,060,535
Stephen L. Cavallaro............. 28,000 6.87 19.250 07/25/06 338,974 859,027
Kevin O. Servatius............... 10,000 2.45 19.250 07/25/06 121,062 306,795
</TABLE>
- ------------------------
(1) The Named Executive Officers received options pursuant to the Company's
incentive plans. See
"--Employee Benefit Plans--Omnibus Incentive Plans."
11
<PAGE>
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1996 AND FISCAL 1996 YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED
OPTIONS AT
NOVEMBER 30, 1996
EXERCISABLE/UNEXERCISABLE VALUE OF IN-THE-MONEY
SHARES ACQUIRED VALUE -------------------------- UNEXERCISED OPTIONS AT
NAME ON EXERCISE REALIZED NOVEMBER 30, 1996(1)
- ----------------------------------- --------------- ------------- EXERCISABLE/UNEXERCISABLE
------------------------------
<S> <C> <C> <C> <C> <C> <C>
Charles W. Scharer................. -- -- 52,000 115,000 $ 88,000 --
Thomas M. Yturbide................. -- -- 142,000 66,667 302,500 --
William B. Ledbetter............... -- -- 15,000 -- 41,250 --
Stephen L. Cavallaro............... -- -- 33,000 24,667 82,000 --
Kevin O. Servatius................. -- -- 10,000 30,000 -- --
</TABLE>
- ------------------------
(1) Options are in-the-money if the fair market value of the underlying
securities exceeds the exercise price of the options.
LONG-TERM INCENTIVE PLAN
In fiscal year 1994, the Company adopted a Long-Term Incentive Plan. The
table below sets forth awards made to Named Executive Officers in the last
fiscal year under the Company's Long-Term Incentive Plan.
LONG-TERM INCENTIVE PLANS -- AWARDS IN FISCAL YEAR 1996
<TABLE>
<CAPTION>
NUMBER OF SHARES ESTIMATED FUTURE PAYOUTS UNDER
UNITS PERFORMANCE OR NON-STOCK PRICE-BASED PLANS
OR OTHER PERIOD UNTIL -----------------------------------
NAME OTHER RIGHTS MATURATION OR PAYOUT THRESHOLD TARGET MAXIMUN
- -------------------------------------- ----------------- ---------------------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C>
Charles W. Scharer.................... -- Three years ending $ 26,055 $ 52,110 $ 78,165
November 30, 1996
-- Three years ending 26,055 52,110 78,165
November 30, 1997
-- Three years ending 26,055 52,110 78,165
November 30, 1998
Thomas M. Yturbide.................... -- Three years ending 30,000 60,000 90,000
November 30, 1996
-- Three years ending 30,000 60,000 90,000
November 30, 1997
-- Three years ending -- -- --
November 30, 1998
Stephen L. Cavallaro.................. -- Three years ending 15,621 31,242 46,862
November 30, 1996
-- Three years ending 15,621 31,246 46,862
November 30, 1997
-- Three years ending 15,621 31,246 46,862
November 30, 1998
Kevin O. Servatius.................... -- Three years ending -- -- --
November 30, 1996
-- Three years ending -- -- --
November 30, 1997
-- Three years ending 11,577 23,154 34,731
November 30, 1998
</TABLE>
12
<PAGE>
Mr. Ledbetter does not participate in the Company's Long-Term Incentive
Plan. Mr. Yturbide does not participate in the Company's Long-term Incentive
Plan beyond the three-year cycle ending November 30, 1997. Benefits received by
participants under this plan are based on the Company's achieving specified
levels of cash flow and return on equity over three-year periods. The target
amount of the incentive is earned if the average of the percentage of
achievement of the two goals equals 100%. The threshold amount is earned if the
average of the percentage of achievement of the two goals equals 80% and the
maximum amount is earned if the average of the percentage of achievement of the
two goals equals or exceeds 120%.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The tables below set forth total benefits payable to executive employees,
including Named Executive Officers, who participate in the Company's
Supplemental Executive Retirement Plan (the "SERP"). Amounts shown represent the
aggregate amounts to which such employees are entitled under the SERP.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN TABLE
(SEVEN YEAR VESTING)
<TABLE>
<CAPTION>
ESTIMATED ANNUAL BENEFITS AT AGE 65
FOR REPRESENTATIVE YEARS OF SERVICE ($)
AVERAGE BASE COMPENSATION -----------------------------------------------------
FOR FINAL FIVE YEARS ($) 3 4 5 6 7
- -------------------------------------------------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
125,000........................................... 12,500 25,000 37,500 50,000 62,500
150,000........................................... 15,000 30,000 45,000 60,000 75,000
175,000........................................... 17,500 35,000 52,500 70,000 87,500
200,000........................................... 20,000 40,000 60,000 80,000 100,000
225,000........................................... 22,500 45,000 67,500 90,000 112,500
250,000........................................... 25,000 50,000 75,000 100,000 125,000
300,000........................................... 30,000 60,000 90,000 120,000 150,000
400,000........................................... 40,000 80,000 120,000 160,000 200,000
450,000........................................... 45,000 90,000 135,000 180,000 225,000
500,000........................................... 50,000 100,000 150,000 200,000 250,000
</TABLE>
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN TABLE
(20 YEAR VESTING)
<TABLE>
<CAPTION>
ESTIMATED ANNUAL BENEFITS AT AGE 65
FOR REPRESENTATIVE YEARS OF SERVICE ($)
AVERAGE BASE COMPENSATION ------------------------------------------
FOR FINAL FIVE YEARS ($) 5 10 15 20
- -------------------------------------------------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
125,000........................................... 15,625 31,250 46,875 62,500
150,000........................................... 18,750 37,500 56,250 75,000
175,000........................................... 21,875 43,750 65,625 87,500
200,000........................................... 25,000 50,000 75,000 100,000
225,000........................................... 28,125 56,250 84,375 112,500
250,000........................................... 31,250 62,500 93,750 125,000
300,000........................................... 37,500 75,000 112,500 150,000
400,000........................................... 50,000 100,000 150,000 200,000
450,000........................................... 56,250 112,500 168,750 225,000
500,000........................................... 62,500 125,000 187,500 250,000
</TABLE>
Participation in the plan requires a recommendation by the President of the
Company and officer or other key employee status. The seven year vesting SERP
presently covers approximately 23 current or former executive employees. The 20
year vesting SERP, for those who began participation after October 1,
13
<PAGE>
1994, covers approximately 21 executive employees. SERP benefits are based on a
percentage of average base compensation earned during the participant's last
five years of service. Base compensation is the participant's annual salary (but
not bonuses or incentive compensation), which is the same as compensation
depicted as salary in the Summary Compensation Table. Benefits are generally
computed as a straight-life annuity, and are not subject to any deduction for
social security benefits. Participants are entitled to receive SERP benefits
upon attaining age 65 (age 63 for Mr. Yturbide) and having become vested in the
SERP. Participants in the seven year vesting SERP become 20% vested after having
accumulated at least three years of service with the Company and vesting
continues in 20% increments each year thereafter, with 100% vesting occurring
upon completion of seven years of service. Participants in the 20 year vesting
SERP become 25% vested after having accumulated at least five years of service
with the Company and vesting continues in 5% increments each year thereafter,
with 100% vesting occurring upon completion of 20 years of service. Amounts
shown for seven years or 20 years of service in the respective tables above
represent the maximum annual payments a participant may receive under the SERP.
Benefits under the SERP are payable for a period of 15 years. In the event that
an individual or entity that did not own shares of Common Stock prior to
February 14, 1994 (the date of the initial public offering), or is not a family
member of an individual who did, acquires more than 25% of the total shares of
Common Stock, participants will become immediately entitled to benefits under
the SERP.
Messrs. Scharer and Yturbide are fully vested under the terms of the seven
year vesting plan. Mr. Cavallaro has three years of credited service under the
terms of the seven year vesting plan. Mr. Servatius has one year of credited
service under the terms of the twenty year vesting plan.
ALTERNATIVE DEFINED BENEFIT PLANS
Certain executives are entitled to participate in a Senior Supplemental
Executive Retirement Plan ("SSERP") that provides for benefits based on a
percentage of the salary that was being paid as of January 1, 1991 and computed
as a straight-life annuity. Benefits under the SSERP are payable one month after
retirement until the recipient reaches age 80. Messrs. Kudrna and William
Ledbetter are fully vested in the SSERP, and will each be entitled to annual
benefits of $200,000 commencing one month after retirement.
See "Honorary Director Program" for a discussion of a special defined
benefit plan designed to compensate Vera Gross for her many years of service to
the Company.
EMPLOYMENT CONTRACTS
Charles W. Scharer serves as President and Chief Executive Officer under an
employment contract with the Company. The term of the contract began on December
1, 1995 and ends on November 30, 2000. The agreement provides that Mr. Scharer's
salary during the term of the agreement will be $350,000 per year subject to
annual review by the Compensation Committee of the Board of Directors. The
agreement also provides Mr. Scharer options to purchase up to 100,000 shares of
the Company's Common Stock at $18 5/8 per share. Twenty percent of the options
granted to Mr. Scharer vested immediately on December 1, 1995, an additional
twenty percent vested on December 1, 1996 and the remaining options vest in
three equal installments on December 1, 1997, 1998 and 1999. The contract is
terminable at any time (upon ninety days notice) by Mr. Scharer or the Company.
If the agreement is terminated by the Company for reason other than cause, Mr.
Scharer is entitled to receive the full value of his salary and other benefits
for the remainder of the agreement. Prior to December 1, 1995, Mr. Scharer
served as Chief Financial Officer under an employment contract with the Company.
His annual salary was $200,000. The agreement also provided that Mr. Scharer
receive restricted stock and stock options pursuant to the 1993 Omnibus
Incentive Plan. See "-- Employee Benefit Plans -Omnibus Incentive Plans."
Thomas M. Yturbide serves as Consultant to the President and Chief Executive
Officer and as Chairman of the Board under an employment contract with the
Company. The term of the agreement
14
<PAGE>
began as of December 1, 1995 and ends on May 31, 1998. His annual salary under
this agreement is $400,000. The agreement also provides Mr. Yturbide options to
purchase up to 100,000 shares of the Company's Common Stock at $18 5/8 per
share. Thirty-three and one-third percent of the options granted to Mr. Yturbide
vested on April 1, 1996 and the remaining options vest in two equal installments
on April 1, 1997 and 1998. The contract is terminable at any time (upon ninety
days notice) by Mr. Yturbide or the Company. If the agreement is terminated by
the Company for reason other than cause, Mr. Yturbide is entitled to receive the
full value of his salary and other benefits for the remainder of the term of the
agreement. Mr Yturbide will continue to serve as consultant to the President and
Chief Executive Officer for the duration of the contract. Prior to December 1,
1995, Mr. Yturbide served as President and Chief Executive Officer under an
employment contract with the Company. His annual salary was $400,000. He also
received signing bonuses of $100,000 on December 6, 1993, $100,000 on December
1, 1994 and $100,000 on December 1, 1995. In addition, the agreement provided
that Mr. Yturbide receive restricted stock and stock options pursuant to the
1993 Omnibus Incentive Plan. See "-- Employee Benefit Plans-Omnibus Incentive
Plans."
William B. Ledbetter serves as Vice Chairman of the Board of Directors and
Secretary under an employment agreement with the Company. His annual salary is
$239,274. He also received, on November 29, 1993, (i) a one-time guaranteed
payment of $650,000 and (ii) options to purchase 15,000 shares of Common Stock
at $14.00 per share (the initial public offering price per share of Common
Stock), which options are immediately exercisable and remain exercisable for a
period of 10 years. Mr. Ledbetter's employment contract is for a term of five
years, terminating on October 31, 1998, and is terminable after two years at any
time by Mr. Ledbetter or at any time by the Company for cause or if Mr.
Ledbetter ceases to be reasonably available to the Company for a period of six
months.
Stephen L. Cavallaro serves as Chief Operating Officer of Subsidiary
Operations under an employment contract with the Company effective as of
February 1, 1996. The term of the contract was extended on February 10, 1997 and
runs for four years, terminating on January 31, 2000. Mr. Cavallaro's annual
salary established by the contract is $280,000 subject to annual review and
adjustment. The contract also provided for the award of options to purchase
10,000 shares of the Company's Common Stock pursuant to the 1996 Omnibus
Incentive Plan. The contract is terminable at any time (upon ninety days notice)
by Mr. Cavallaro or the Company. If the contract is terminated by the Company
for reasons other than cause, Mr. Cavallaro is entitled to receive the full
value of his salary and other benefits for the remainder of the contract term.
Prior to February 1, 1996, Mr. Cavallaro served as Senior Vice President and
General Manager-Hard Rock Hotel under an employment contract with the Company.
His annual salary under the contract was $245,000. The agreement also provided
that Mr. Cavallaro receive restricted stock and stock options pursuant to the
1993 Omnibus Incentive Plan. See "--Employee Benefit Plans Omnibus Incentive
Plans."
Mr. Servatius serves as Senior Vice President and General Manager- Harveys
Resort Hotel/Casino under an employment contract with the Company effective as
of August 14, 1995. The term of the contract runs for five years, terminating on
August 13, 2000. Mr. Servatius' annual salary established by the contract was
$225,000 for the first year, increased to $250,000 on the first anniversary of
the contract and will increase to $275,000 on the second anniversary of the
contract. The contract also provided for the award of 15,000 shares of the
Company's Common Stock and options to purchase an additional 30,000 shares
pursuant to the 1993 Omnibus Incentive Plan. See "--Employee Benefit
Plans-Omnibus Incentive Plans". The contract is terminable at anytime (upon
ninety days notice) by Mr. Servatius or the Company. If the contract is
terminated by the Company for reasons other than cause, Mr. Servatius is
entitled to receive the full value of his salary and other benefits for the
remainder of the contract term.
15
<PAGE>
EMPLOYEE BENEFIT PLANS
OMNIBUS INCENTIVE PLANS
In November 1993, the Company adopted the 1993 Omnibus Incentive Plan (the
"1993 Plan") and in March 1996, the Company adopted the 1996 Omnibus Incentive
Plan (the "1996 Plan" and together with the 1993 Plan, collectively referred to
as the "Incentive Plan"). The Incentive Plan was adopted to further and promote
the interests of the Company, its subsidiaries and its stockholders by enabling
the Company to attract, retain and motivate key employees or prospective
employees, and to align the interests of such individuals and the stockholders
of the Company. The Incentive Plan is administered by the Compensation
Committee, which is authorized to construe and interpret the Incentive Plan and
to promulgate, amend and rescind rules and regulations relating to the
implementation, administration and maintenance of the Incentive Plan, including
selecting the Incentive Plan's participants, making awards of stock options,
stock appreciation rights, restricted stock grants and/or performance units
(each an "Award," and collectively, "Awards") in such amounts and form as the
Compensation Committee determines and imposing any restrictions, terms and
conditions upon such Awards as the Compensation Committee deems appropriate.
The maximum number of shares of Common Stock authorized for issuance under
the 1993 Plan, other than shares of Common Stock issued pursuant to Awards and
subsequently reacquired by the Company, is 915,219. The maximum number of shares
of Common Stock authorized for issuance under the 1996 Plan, other than shares
of Common Stock issued pursuant to Awards and subsequently reacquired by the
Company, is 500,000. No Awards may be granted or shares of Common Stock issued
under the 1993 Plan or the 1996 Plan after 10 years from the date of adoption of
such plan; provided that shares of Common Stock may be issued thereafter
pursuant to Awards granted prior to such date. Awards granted prior to such date
may be amended after such date, so long as there is no increase in the number of
shares of Common Stock subject to or comprising that Award.
Any Award that constitutes a derivative security (as defined in Rule
16a-1(c) under the Exchange Act) and is granted to or held by a person subject
to Section 16 of the Exchange Act shall be subject to the restrictions on
exercisability and on transfer set forth in or pursuant to Rule 16b-3 of the
Exchange Act. The Incentive Plan is intended to satisfy the requirements of Rule
16b-3 under Section 16 of the Exchange Act in the case of recipients subject to
such Section 16.
In the event of a stock split, the declaration of a stock dividend, the
exchange or conversion of securities of the class subject to an Award into cash,
property or different kinds of securities pursuant to a merger, reorganization
or otherwise, or the sale of substantially all of the assets of the Company or
if an extraordinary dividend is declared, adjustments will be made in (i) the
number and type of share or other securities or cash or other property that may
be acquired pursuant to each Award, (ii) the maximum number and type of shares
or other securities that may be issued pursuant to other Awards thereafter
granted under the Incentive Plan, and (iii) any other terms as are necessarily
affected by such event.
On November 12, 1993, the Company granted an aggregate of 176,500 shares of
restricted stock and 348,000 stock options to certain key management of the
Company. Of the shares of restricted stock, approximately 25% became
unrestricted and vested immediately upon the effective date of the Company's
initial public offering and the remaining shares became unrestricted and vested
over a period of approximately three years. The stock options granted become
exercisable in three installments, 33 1/3% on each of the first three
anniversaries of grant, and expire ten years from the date of grant. The initial
grantees included Mr. Scharer (18,000 shares of restricted stock and 32,000
stock options), Mr. Yturbide (55,000 shares of restricted stock and 110,000
stock options) and Mr. Cavallaro (15,000 shares of restricted stock and 30,000
stock options).
Subsequently, the Company has granted an additional 52,000 shares of
restricted stock and options to purchase 550,280 shares to key management
employees. The grantees of these additional Awards included Mr. Scharer (135,000
stock options), Mr. Yturbide (100,000 stock options), Mr. Cavallaro (28,000
stock
16
<PAGE>
options) and Mr. Servatius (15,000 shares of restricted stock and 40,000 stock
options). In each case, except for Mr. Scharer (as to 100,000 stock options),
Mr. Yturbide and Mr. Cavallaro (as to 10,000 stock options), the stock options
granted become exercisable in three installments, 33 1/3% on each of the first
three anniversaries of grant. As to Mr. Scharer's stock options, 100,000 stock
options vest in 20,000 share increments; the first on the grant date of December
1, 1995, the second on December 1, 1996 and the remaining options on the next
three anniversaries of the grant date. As to Mr. Yturbide's 100,000 stock
options, 33 1/3% vested on April 1, 1996 and the reminder vest in two equal
installments on April 1, 1997 and 1998. As to 10,000 of Mr. Cavallaro's stock
options, 33 1/3% became exercisable on the date of grant, July 25, 1996, and the
remainder become exercisable in equal installments on the next two anniversaries
of the grant. Mr. Servatius' 15,000 shares of restricted stock vested
immediately as to 25% of the shares on the grant date of August 14, 1995, an
additional 25% vested on August 14, 1996 and the balance will vest in equal
installments on each of the next two anniversaries of the grant date. All of the
stock options expire ten years from the date of grant.
1993 NON-EMPLOYEE DIRECTORS STOCK OPTION PROGRAM
The purpose of the Company's 1993 Non-Employee Directors Stock Option
Program (the "Program") is to promote the interests of the Company and its
stockholders by strengthening the Company's ability to attract and retain the
services of experienced and knowledgeable non-employee directors and by
encouraging such directors to acquire an increased proprietary interest in the
Company.
The total number of shares of Common Stock for which options may be granted
under the Program shall not exceed 60,000 subject to automatic adjustments for
stock splits and certain other corporate transactions and/or recapitalization.
An initial grant of options to acquire 4,500 shares has been awarded to each
current non-employee director with the exception of Eugene R. White who was
appointed to the Board of Directors in November 1996. Pursuant to the Program,
initial awards of options to acquire 4,500 shares will be granted to any new
non-employee director (such as Mr. White) immediately following the first annual
meeting after such non-employee director is first elected or appointed to the
Board of Directors. Subsequent annual grants of options to acquire 1,500 shares
will be made immediately following each annual meeting to all non-employee
directors who had previously received initial grants.
The Board of Directors may amend the Program, provided that no amendment
which would change the amount, price or timing of the initial and annual grants
may be made more often than once every six months, and provided, further, that
certain other material changes may not be made to the Program without
stockholder approval.
Options granted under the Program become exercisable in three installments,
33 1/3% on the date of grant and 33 1/3% on each of the next two anniversaries
of grant. Each option granted expires ten years from the date of its grant. The
Program continues in effect until it is terminated by action of the Board of
Directors or the stockholders.
If a non-employee director voluntarily terminates his or her board
membership at any time, the options granted to such director shall automatically
expire and be forfeited as of the effective date of such service termination.
For purposes of the Program, a "voluntary termination" will occur only if a non-
employee director resigns (other than due to death, disability or retirement (as
defined in the Program)) or refuses to stand for election to the Board of
Directors if nominated (other than due to death, disability or retirement). If
the director's membership on the Board of Directors is terminated for any other
reason, including a failure to be reelected by the stockholders of the Company,
the options will become fully exercisable as of the date of such termination and
each option shall expire two years after the date of any such termination (but
not beyond the expiration of the stated option term).
17
<PAGE>
1993 EMPLOYEE STOCK GRANT PROGRAM
In November 1993, the Company adopted the 1993 Employee Stock Grant Program
(the "Employee Stock Program") providing for a one-time grant of shares of
Common Stock to persons who had been employed by the Company for at least one
year and were not otherwise stockholders in the Company or eligible to
participate in any of the Company's other benefit plans providing for stock
ownership. Under the Employee Stock Program, each eligible employee on the date
of grant received one share of Common Stock for each full year of past service
to the Company plus five additional shares of Common Stock for every five years
of past service to the Company. The Company granted 20,133 shares of Common
Stock under the Employee Stock Program.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles of Incorporation contain, pursuant to Nevada law,
provisions for indemnification of officers and directors of the Company and in
certain cases employees and other persons. In addition, the Company's Bylaws
require the Company to indemnify such persons to the full extent permitted by
Nevada law. Each such person will be indemnified in any proceeding if he or she
acted in good faith and in a manner which he or she reasonably believed to be
in, or not opposed to, the best interests of the Company. Indemnification would
cover expenses, including attorneys' fees, judgments, fines and amounts paid in
settlement. The Company's Bylaws also provide that the Company's Board of
Directors may cause the Company to purchase and maintain insurance on behalf of
any present or past director or officer insuring against any liability asserted
against such person incurred in the capacity of director or officer or arising
out of such status, whether or not the Company would have the power to indemnify
such person. The Company maintains directors' and officers' liability insurance.
The Company has also entered into separate indemnification agreements with
its directors and officers. Each indemnification agreement provides for, among
other things (i) indemnification against any and all expenses, judgments, fines,
penalties and amounts paid in settlement of any claim against an indemnified
party unless it is determined, as provided in the indemnification agreement,
that indemnification is not permitted under law and (ii) prompt advancement of
expenses to any indemnitee in connection with his or her defense against any
claim.
18
<PAGE>
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
COMPENSATION PHILOSOPHIES
It is the responsibility of the Compensation Committee (the "Committee") to
establish and review the Company's executive compensation programs and policies,
to monitor performance and make recommendations concerning executive
compensation and benefits to the Board of Directors.
The Committee's philosophy and policies are to provide a total compensation
program which will enable the Company to attract, retain, and motivate an
outstanding management team. The Committee strongly believes that stock
ownership and incentive programs, based on above-average corporate performance,
will encourage management to best serve the interests of our shareholders.
EXECUTIVE COMPENSATION
Compensation paid to executive officers includes an industry competitive
salary, a management incentive cash bonus, which relates to the Company's annual
achievement of financial performance goals and individual performance, a
long-term incentive plan based on cash flow and return on equity goals, and
stock options which align management's interests with stockholders' interests.
In determining compensation levels, the Board of Directors and the
Compensation Committee consider, among other things, 1) the financial
performance of the Company during the past year; 2) recommendations of the
Company's Chief Executive Officer, based on his evaluation of the breadth of
duties of the executive officers and their contribution to the Company; 3)
extraordinary performance during the year; 4) levels at which the Company's
competitors compensate their executive officers; and 5) relative stock
performance vs. comparable gaming companies. Executive Officers also participate
in benefit plans generally available to employees including a medical plan, a
401(k) plan, and group life insurance. Additional benefits available to the
executive officers include deferred compensation and a supplemental executive
retirement program.
Executive compensation is evaluated annually. Existing compensation levels
are compared with compensation levels of executives in similar capacities with
other publicly-held gaming companies. The Company's current financial position
and performance for the past year is reviewed, including growth in revenues,
operating cash flow generated, and earnings per share. In addition , plans for
performance for the upcoming year and future periods are reviewed as to revenue
growth and earnings. An evaluation is made as to the degree that the executive,
including the Chief Executive Officer, contributes to the achievement of the
Company's results and other Company goals. Based on these factors, the Committee
makes recommendations to the Board of Directors regarding changes to executive
compensation.
The 1993 Omnibus Incentive Plan authorizes the Compensation Committee to
make awards of stock options, stock appreciation rights, restricted stock grants
and performance units. The size of grants and stock options are determined by a
number of factors, including comparable grants to executive officers and
employees by other gaming companies which compete in the gaming industry.
1996 CHIEF EXECUTIVE OFFICER COMPENSATION
The same philosophies described above for executive compensation were used
by the Compensation Committee to determine the compensation of the Company's
President and Chief Executive Officer, Charles W. Scharer. The Compensation
Committee established Mr. Scharer's annual base salary of $350,000 for the
fiscal year 1996 based upon a review of compensation by gaming companies having
similar revenues and scopes of operations, together with an evaluation of the
Company's results in fiscal year 1995, and the degree of progress made in
implementing the Company's strategic plans. Mr. Scharer also received a bonus of
$125,000 paid in fiscal year 1996.
19
<PAGE>
SECTION 162(M) OF THE INTERNAL REVENUE CODE
Section 162(m) of the Internal Revenue Code disallows a deduction for
federal income tax purposes of most compensation exceeding $1,000,000 in any
year paid to the Company's Chief Executive Officer and the four other most
highly compensated executive officers of a publicly traded corporation. The
Company was not impacted by Section 162(m) in fiscal 1996. In future years, the
Compensation Committee intends to take into account the effect of Section 162(m)
if the compensation payable to any executive officer approaches $1,000,000.
Respectfully Submitted,
HARVEYS CASINO RESORTS COMPENSATION
COMMITTEE
Eugene R. White [Chair]
Richard Kudrna, Sr.
Jessica L. Ledbetter
William B. Ledbetter
Luther Mack, Jr.
Franklin K. Rahbeck
20
<PAGE>
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder return of the
Company, with the cumulative total return of the Standard & Poor's 500 Stock
Index ("S&P 500") and the cumulative total return of the Dow Jones Entertainment
& Leisure-Casinos Index ("DJ Casinos"). The performance graph assumes that $100
was invested on February 15, 1994 in each of the Company's Common Stock, the S&P
500 and the DJ Casinos. The stock price performance shown in this graph is
neither necessarily indicative of nor intended to suggest future stock price
performance.
COMPARISON OF 33 MONTH CUMULATIVE TOTAL RETURN*
AMONG HARVEYS CASINO RESORTS, THE S&P 500 INDEX
AND THE DOW JONES ENTERTAINMENT & LEISURE-CASINOS INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DOW JONES ENTERTAINMENT &
<S> <C> <C> <C>
HARVEY'S CASINO RESORTS S&P 500 LEISURE-CASINOS
2/15/94 $100 $100 $100
11/94 97 98 61
11/95 109 134 94
11/96 124 172 107
</TABLE>
* $100 INVESTED ON 2/15/94 IN STOCK OR INDEX --
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING NOVEMBER 30.
CERTAIN TRANSACTIONS
Wells Fargo Bank, N. A., Jessica L. Ledbetter, Kirk B. Ledbetter and
Franklin K. Rahbeck are the co-trustees of the William B. Ledbetter and Beverlee
A. Ledbetter Irrevocable Trust (the "Trust"). The Trust owns survivorship life
insurance policies on the lives of William B. Ledbetter and Beverlee A.
Ledbetter, deceased. Prior to fiscal 1995 the Company paid the premiums on the
life insurance policies. The Company has no further obligation to pay such
premiums. On November 15, 1993 the Trust issued a note payable to the Company
for the amounts of the premiums previously paid by the Company. On January 31,
1994, the Trust issued a note payable to the Company for the amount of a premium
paid by the Company in 1994. The notes are in the principal amounts of
$1,376,995 and $455,275 and bear interest at the rate of 5.84% and 6.30%,
respectively. Interest on the notes is payable on December 31 of each year and
the entire unpaid principal amount becomes due on the earlier of November 15,
2001 or the death of William B. Ledbetter.
21
<PAGE>
SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche LLP to serve as the
Company's independent public accountants to audit the financial statements of
the Company for the 1997 fiscal year. Deloitte & Touche LLP served as the
Company's independent public accountants during the 1996 fiscal year. A
representative of Deloitte & Touche LLP will attend the Annual Meeting, will be
given an opportunity to make a statement and will be available to answer
appropriate questions.
On June 27, 1996, Grant Thornton LLP, who had previously been engaged as the
independent public accountants to audit the financial statements of the Company
was dismissed as the Company's certifying accountant, and replaced by Deloitte &
Touche LLP.
The independent public accountants' reports on the financial statements of
the Company for each of the past two fiscal years did not contain an adverse
opinion or a disclaimer of opinion, nor were the opinions qualified or modified
as to uncertainty, audit scope, or accounting principles.
The decision to change accountants was recommended by the Audit Committee of
the Board of Directors of the Company and was approved by the Company's Board of
Directors.
During the Company's two fiscal years and the subsequent interim period
preceding the change in accountants there were no disagreements with Grant
Thornton LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreement, if not
resolved to the satisfaction of Grant Thornton LLP would have caused them to
make reference to the subject matter of the disagreement in connection with
their report.
During the Company's two fiscal years and the subsequent interim period
preceding the change in accountants there were no "reportable events" as listed
in paragraph (a) (1) (v) of Item 304 of Regulation S-K.
OTHER MATTERS
The Board of Directors is not aware of any other matters to be presented at
the meeting. If any other matters should properly come before the meeting, the
persons named in the proxy will vote the proxies according to their best
judgment.
STOCKHOLDER PROPOSALS
Stockholder proposals, if any, which may be considered for inclusion in the
Company's proxy materials for the 1998 Annual Meeting must be received by the
Company at its offices at Highway 50 & Stateline Avenue, Lake Tahoe, Nevada
89449 not later than November 28, 1997.
ANNUAL REPORT
The Annual Report to Stockholders for fiscal 1996 accompanies this proxy
statement.
22
<PAGE>
HARVEYS CASINO RESORTS
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS MAY 1, 1997
The undersigned hereby appoints William B. Ledbetter and Richard F. Kudrna,
Sr., and each of them, the proxies and attorneys-in-fact of the undersigned,
with full power of substitution in each, for and in the name of the
undersigned to attend the Annual Meeting of Stockholders of Harveys Casino
Resorts to be held May 1, 1997 at 10:00 a.m. local time at Harveys Resort
Hotel/Casino, U.S. Highway 50 and Stateline Avenue, Lake Tahoe, Nevada, and
any and all adjournments thereof, and to vote thereat the number of shares of
Common Stock which the undersigned would be entitled to vote if then
personally present as follows:
(Continued and to be signed on the reverse side)
X Please mark your
votes as in this
example.
<TABLE>
<S> <C> <C>
FOR all nominees WITHHOLD MANAGEMENT RECOMMENDS A VOTE FOR ITEM 1.
listed at right (except AUTHORITY IF NO SPECIFICATION IS MADE, THIS
as indicated to the (to vote for all nominees NOMINEES: Charles W. Scharer PROXY WILL BE VOTED FOR ELECTION
contrary below) listed at right) Luther Mack, Jr. OF THE PROPOSED DIRECTORS.
Ronald R. Zideck If any other business is presented
Item 1. To at the annual meeting, the proxy
elect three / / / / will be voted in accordance with
Directors to the recommendations of management.
serve a term
of three years I PLAN ON ATTENDING THE MEETING. / /
until the 2000 Annual Meeting of Stockholders.
INSTRUCTIONS: To withhold authority to vote for any
individual nominee, write the nominee's name here.
PLEASE SIGN AND RETURN PROMPTLY IN THE
SELF-ADDRESSED ENVELOPE.
______________________________________________________
SIGNATURE ____________________________________ DATE ____________ SIGNATURE ________________________________ DATE ______________
NOTE: Signature of stockholders should correspond exactly with the name shown herein. Corporate officers, attorneys, trustees,
executors, administrators, guardians, and others should designate their full titles. Joint owners should each sign.
</TABLE>
<PAGE>
HARVEYS CASINO RESORTS
1997 ANNUAL MEETING OF STOCKHOLDERS
HARVEYS RESORT HOTEL/CASINO
U.S. HIGHWAY 50 AND STATELINE AVENUE
LAKE TAHOE, NEVADA
MAY 1, 1997
10:00 A.M.
ADMITTANCE TICKET
This ticket entitles you and one guest to attend the Annual Meeting.
For room reservations call 1-800-HARVEYS and ask for the
"Shareholder's Special Offer"
CAMERAS AND RECORDING DEVICES WILL NOT BE ALLOWED AT THE MEETING.
Dear Stockholder:
The 1997 Annual Meeting of Stockholders of Harveys Casino Resorts will be
held at Harveys Resort Hotel/Casino, U.S. Highway 50 and Stateline Avenue,
Lake Tahoe, Nevada on May 1, 1997 at 10:00 a.m., Local Time. At the meeting,
stockholders will act to elect three directors.
Your vote is important. Whether or not you plan to attend the meeting, please
review the enclosed proxy statement, complete the proxy form and return it
promptly in the envelope provided.
If you plan to attend the annual meeting in person, please note that
attendance at the meeting will be limited to you and one guest.
Sincerely,
Charles W. Scharer
Chief Executive Officer and Director
