EXHIBIT 10(42)
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HARRAH'S ENTERTAINMENT, INC.
Stock Option Award
THIS CERTIFIES THAT the Human Resources Committee of the Board of
Directors of Harrah's Entertainment, Inc. has awarded
__________________________________ a Nonqualified Stock Option to
purchase ___________________ shares of the Company's Common Stock at a
price of ____________ per share.
Original Grant Date: ___________________
This option is exercisable as follows:
This award is subject to the terms and conditions on the reverse side of
this award and to the terms and conditions of the Company's 1990 Stock
Option Plan, as it may be amended from time to time. A summary of
certain of the Plan's terms and conditions is included on the reverse
side of this award. This document constitutes part of a prospectus
concerning securities that have been registered under the Securities Act
of 1933.
DATED as of this ______________ day of _____________________, 19_______.
HARRAH'S ENTERTAINMENT, INC.
/s/ Rebecca W. Ballou /s/ Michael D. Rose
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Secretary Chairman of the Board
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SUMMARY OF CERTAIN CONDITIONS
Shares of Harrah's Entertainment, Inc. ("Harrah's Entertainment" or
"Company") common stock may be purchased under this stock option. Subject
to the terms and conditions of the Plan, the term of this option is 10
years and one day from the original grant date shown on the front side of
this certificate. The option is exercisable in accordance with the stated
schedule indicated on the front side of this certificate by giving written
notice addressed to the Corporate Compensation Department, Harrrah's
Entertainment, Inc. 1023 Cherry Road, Memphis, TN 38117 (or such other
address designated by the Company), specifying the number of shares to be
purchased and by payment of the option price according to the rules of the
Plan.
Subject to the Plan and the Administrative Regulations thereunder and
contractual provisions, this stock option, to the extent not exercised,
shall terminate and be forfeited on the expiration of 10 years and one day
from the original grant date shown on the front side of this certificate,
upon breach by the optionee of any provision of this option, or upon
optionee's ceasing to be an active employee of Harrah's Entertainment (or
its legal successor) or its subsidiaries for any reason including, but not
limited to, retirement and voluntary or involuntary termination including
termination due to sale or closure of a business unit or sale of a
subsidiary, provided however:
- - If active employment ceases during the term of this stock option
because of death or disability, then the unexercised portion of the
options that were already vested (i.e., exercisable) at that time plus
50 percent of any future unvested installments shall be exercisable in
full on the date of death or on the date of the determination of
disability, as the case may be. All remaining unvested options will
be forfeited.
- - The time period to exercise vested options, following retirement for
age, death or determination of disability during the term of this
option while in the employ of the Company (or its legal successor) or
its subsidiaries, is as follows:
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Years of Service Period to Exercise
---------------- Vested Options
after Death, Disability or
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Retirement
----------
- --------------------------------------------------------------------------------
under 10 years (for death one year
or disability)
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10 to 20 years (for death, two years
disability or retirement)
- --------------------------------------------------------------------------------
20 or more years (for death three years
disability or retirement
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- - Retirement means termination during the term of this option at or
after age 55 and having 10 or more years of service with the Company
(or its legal successor) or its subsidiaries. Disability means a
determination (while you are an employee or on authorized leave) that
you qualify for long-term disability insurance under the Company's LTD
policy. Upon death, vested options may be exercised by your proper
legal representative (executor or administrator) or your legal
beneficiary subject to the Company being properly assured and legally
advised of the rights of such persons.
- - Reference is made to the vesting acceleration provisions in the Plan's
Administrative Regulations which provisions are applicable upon a
"Change in Control" (as defined in, and subject to, such Regulations).
This stock option shall be non-transferable by the optionee other than by
will or the laws of descent and distribution and shall be exercisable
during optionee's lifetime only by optionee.
This stock option may not be exercised at a time when the exercise thereof
or the issuance of shares thereunder would constitute a violation of any
federal or state laws or rules of any stock exchange where the common stock
of Harrah's Entertainment, Inc., (or its legal successor) is listed.
ALL THE TERMS AND CONDITIONS OF THE HARRAH'S ENTERTAINMENT, INC., 1990
STOCK OPTION PLAN AND ADMINISTRATIVE REGULATIONS THEREUNDER, AS AMENDED
FROM TIME TO TIME, ARE INCORPORATED HEREIN BY REFERENCE. ANY CONFLICT OR
QUESTIONS OF INTERPRETATION SHALL BE GOVERNED BY THE PROVISIONS OF THE
PLAN, THE PLAN'S ADMINISTRATIVE REGULATIONS AND THE DECISIONS OF THE HUMAN
RESOURCES COMMITTEE.
This stock option is subject to the special clause regarding non-
competition as approved by the Human Resources Committee on December 15,
1995 and made a part of this award.
Special Clause
Harrah's Entertainment, Inc. (the "Company")
On December 15, 1995 the Human Resources Committee of the Company's Board
of Directors approved the following clause that applies to all stock
options granted on or after December 15, 1995, under the Company's 1990
Stock Option Plan:
(1) If the employee (a) terminates his or her employment voluntarily and
within one year thereafter, directly or indirectly, without the prior
written consent of the Company, goes to work for or provides services
or assistance (as an employee, partner, investor, consultant or in any
other capacity) to a competing business in the United States; or (b)
directly or indirectly solicits or recruits to a competing business
any employee (salary grade 20 and higher) of the Company or of its
direct or indirect subsidiaries during the one year after voluntary
employment termination, then the former employee will be obligated to
repay to the Company in cash any aggregate spread (less taxes paid by
the employee thereon) realized upon any exercise of the stock option
that occurred during the last three months of employment or
thereafter.
(2) A competing business is defined as any business that competes with any
business operated or managed by the Company or its direct or indirect
subsidiaries in the United States at the time of the employee's
termination of employment.
(3) Competition does not include an investment of 1% or less in the public
stock or public debt of a competing company.
(4) The chief executive officer will have authority on behalf of the
Company to determine whether the clause has been violated. The Human
Resources Committee will make this determination in regard to the
chief executive officer.
(5) The Company will have a right of set-off to collect the spread from
any amounts owed to the employee including deferred compensation.