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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                           --------------------------

                                   FORM 10-K

(MARK ONE)

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<C>        <S>
   /X/     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

                  FOR THE FISCAL YEAR ENDED NOVEMBER 30, 2000
                                       OR

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<C>        <S>
   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
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      FOR THE TRANSITION PERIOD FROM ________________ TO ________________

                         COMMISSION FILE NUMBER 1-12802

                           --------------------------

                             HARVEYS CASINO RESORTS
             (Exact name of registrant as specified in its charter)

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<S>                                          <C>
              NEVADA                                     88-0066882
   (State or other jurisdiction                       (I.R.S. Employer
of incorporation or organization)                   Identification No.)

           HIGHWAY 50 &
         STATELINE AVENUE
 P.O. BOX 128 LAKE TAHOE, NEVADA
      (Address of principal                                89449
        executive offices)                               (Zip Code)
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       Registrant's telephone number, including area code: (775) 588-2411

                            ------------------------

        Securities registered pursuant to Section 12(b) of the Act: None

          Securities registered pursuant to Section 12(g) of the Act:

                Class A Common Stock; par value $0.01 per share

                           --------------------------

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes _X_  No ____

    Indicate by check mark if the disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]

    The registrant's common stock is not publicly traded. Therefore, the
aggregate market value of the common stock held by non-affiliates is not readily
determinable.

    The number of shares outstanding of the registrant's Class A Common Stock,
$.01 par value was 68,876 and the number of shares outstanding of the
registrant's Class B Common Stock, $0.01 par value was 7,268,427, each as of
February 20, 2001.

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                                     PART I

ITEM 1. BUSINESS

OVERVIEW

    Harveys Casino Resorts is a Nevada corporation that has been engaged in the
gaming industry for over 56 years. Through wholly-owned subsidiaries, Harveys
Casino Resorts owns and operates gaming establishments in Nevada, Iowa and
Colorado. Harveys Casino Resorts may be referred to in this report as the
"Company," the "Registrant," "Harveys," "we," "us" or "our". Unless the context
requires otherwise, such references include our wholly-owned subsidiaries.

    On February 2, 1999, Harveys Acquisition Corporation, which was formed at
the direction of Colony Investors III, L. P., a Delaware limited partnership,
solely for the purpose of acquiring Harveys, merged with and into Harveys (the
"Colony/Harveys merger"). Prior to the Colony/Harveys merger, Harveys was a
publicly held company. Following the Colony/Harveys merger, the capital stock of
Harveys Acquisition Corporation became the capital stock of Harveys. Colony
Investors III now owns approximately 97% of our common equity interests. The
remaining common equity interests are owned by Colony HCR Voteco, LLC, a
Delaware limited liability company, and by certain members of Harveys'
management. Colony HCR Voteco is an affiliate of Colony Investors III. Harveys
was the surviving corporation in the Colony/Harveys merger and is continuing
business operations as conducted prior to the Colony/Harveys merger.

    Through our wholly-owned subsidiaries, we currently own and operate the
following:

    Harveys Resort & Casino ("Harveys Resort")--Owned and operated by Harveys
Tahoe Management Company, Inc., Harveys Resort is situated near the south shore
of scenic Lake Tahoe on the Nevada/California state line and U.S. Highway 50,
the main route through south Lake Tahoe. Originally founded by Harvey and
Llewellyn Gross in 1944 as a one-room saloon, cafe and casino, the Company has
developed the property into the Lake Tahoe area's largest hotel/casino measured
by both total number of rooms and square footage.

    The main structure encompasses over one million square feet in a 17-story
glass-faced tower completed in 1991, connected to a 12-story tower which was
completely rebuilt in 1982. The hotel provides panoramic views of the lake and
the surrounding mountains and is among Lake Tahoe's most modern facilities.
Harveys Resort features 740 rooms, 36 of which are luxury suites, and an 82,000
square foot casino containing approximately 2,008 slot machines, 96 table games,
a 13-table poker area, a race and sports book and a keno lounge. Harveys Resort
also offers a Platinum Players Club featuring VIP amenities designed to reward
and retain our loyal premium gaming customers. Other amenities include 23,000
square feet of convention space, 2,989 parking spaces, a substantial portion of
which are included in a parking garage, a 280 seat cabaret, a wedding chapel,
retail shops, a pool, a health club and a video game arcade. Harveys Resort's
eight restaurants offer a wide variety of high quality food and consist of a
coffee shop, a Mexican restaurant, a seafood and pasta restaurant, a premier
steakhouse, a buffet, a snack bar, Llewellyn's, our upscale award-winning
restaurant featuring top quality dining and a spectacular view of Lake Tahoe,
and a Hard Rock Cafe, located on the casino floor, which is owned and operated
by Hard Rock Cafe International (USA), Inc. In recognition of the outstanding
quality of the facility and our excellent service, Harveys Resort has received
the AAA Four Diamond Award every year for the past 19 years.

    Harveys Casino Hotel-Owned and operated by Harveys Iowa Management
Company, Inc., Harveys Casino Hotel's facilities are located next to the
Missouri River directly across from Omaha, Nebraska, in Council Bluffs, Iowa.
The riverboat casino opened in January 1996 and currently has 28,250 square feet
of casino space on three decks accommodating 2,352 passengers and housing 1,220
slot machines, 45 table games and a five-table poker area. The land-based
amenities opened in May 1996 and include 251 hotel rooms in a 14-story tower,
Beverlee's, a rooftop fine dining restaurant offering a view of the

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Missouri River and the Omaha skyline, a buffet and a casual restaurant, 21,000
square feet of convention space, a parking garage, completed in October 1999,
offering 1,630 parking spaces with climate-controlled access to the adjacent
casino and additional surface parking for 1,300 vehicles. The land-based
facilities also include a Platinum Players Club offering VIP amenities designed
to reward and retain our loyal premium gaming customers. Other attractions
include an 18-hole municipal golf course adjacent to our hotel and a nine-hole
municipal golf course operated by the city on land they lease from us at a
nominal annual fee.

    Bluffs Run Casino--On October 6, 1999, our wholly-owned subsidiary, HBR
Realty Company, Inc., purchased the net assets (except the gaming equipment) of
the greyhound racetrack and land-based casino in Council Bluffs, Iowa. We
purchased these assets from Iowa West Racing Association, Nonprofit Corporation,
an Iowa nonprofit corporation. Immediately after closing of the transaction, we
leased the facilities known as Bluffs Run Casino back to Iowa West Racing
Association for an initial term of 25 years. At the same time, Iowa West Racing
Association retained our wholly-owned subsidiary, Harveys BR Management
Company, Inc., to manage Bluffs Run Casino for all periods during which the
lease exists. Iowa West Racing Association continues to hold the pari-mutuel and
gaming licenses under Iowa law and continues to own the gaming equipment located
at Bluffs Run Casino. We receive management fees and lease income generally
equal to the ongoing cash flow from the operations of Bluffs Run Casino. The
facilities offer patrons enclosed viewing of, and wagering on, the on-site
greyhound racing and simulcast greyhound and horse racing from various outside
racetracks. The casino consists of approximately 29,600 square feet and
currently provides approximately 1,500 slot machines. Additional amenities
include live entertainment events, restaurants and cocktail lounges, surface
parking for 3,117 cars and a recreational vehicle park accommodating 115
vehicles.

    Harveys Wagon Wheel Hotel/Casino ("Harveys Wagon Wheel")--Owned and operated
by Harveys C.C. Management Company, Inc., Harveys Wagon Wheel is located in
Central City, Colorado, a picturesque mountain town approximately 35 miles west
of Denver. Harveys Wagon Wheel opened in December 1994 as the first major
hotel/casino to serve the greater Denver area. Harveys Wagon Wheel includes 118
hotel rooms, a 40,000 square foot casino housing 1,040 slot machines, eight
table games, a six-table poker area and a Platinum Players Club offering VIP
amenities designed to reward and retain our loyal premium gaming customers.
Other amenities include 730 on-site parking spaces, 530 of which are in a
self-parking garage, a Tony Roma's Famous for Ribs restaurant and a Pesto's
Pasta snack bar, an entertainment lounge and a video game arcade.

BUSINESS STRATEGY

    Our business strategy is to develop or acquire facilities in markets in
which we believe we can establish and maintain a prominent position or niche.
Each of our properties offers casino gaming and a full range of amenities in a
friendly atmosphere that caters to middle-income customers. Our strategy
emphasizes the following elements:

    HIGH-QUALITY FACILITIES AND SUPERIOR CUSTOMER SERVICE

    As part of our commitment to providing a quality entertainment experience
for our patrons, we are dedicated to ensuring a high level of customer
satisfaction and loyalty by providing distinctive and modern accommodations and
attentive customer service in a friendly atmosphere. We recognize that
consistent quality and a comfortable atmosphere can differentiate our facilities
from the competition in all of our markets. We strive to meet customer demand by
furnishing each of our properties with a variety of restaurants and non-gaming
amenities. To foster a high level of customer satisfaction through attentive
customer service, our management plays an active role in the training of all of
our employees at all levels. Harveys' goal of becoming a truly customer-focused
organization has been achieved at all of our properties through training
programs, role playing and simulations. We believe that these programs have
evolved to provide the Company's customers with a truly unique experience. We
have

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implemented attractive employee benefit programs at all of our facilities to
recruit and retain friendly, professional employees.

    STRATEGIC LOCATIONS

    Harveys believes that location is the key to attracting customers. South
Lake Tahoe, which draws approximately two million visitors per year, is a unique
gaming location because of its natural surroundings and variety of year-round
outdoor attractions and activities. Harveys Resort is strategically placed on a
site adjacent to the California border in proximity to more than 6,400 hotel and
motel rooms in non-gaming facilities. The City of South Lake Tahoe, California
has adopted a redevelopment plan and created the South Tahoe Redevelopment
Agency. The redevelopment project encompasses approximately 60 acres. Under the
first phase of this plan, a number of older motel and retail properties along
U.S. Highway 50 were demolished, creating a scenic open space corridor
containing public facilities and wetlands. This initial phase also included a
400-room Embassy Suites hotel/ timeshare development completed in 1991. The next
phase of the plan includes the centerpiece of the redevelopment, an aerial
gondola, which opened in December 2000 and transports skiers and sightseers from
U.S. Highway 50 to the top of the Heavenly ski area. This phase also includes a
197 quarter-share unit condominium hotel and a 249 unit Marriott timeshare with
ground breaking for each anticipated to occur in May 2001. Under the third and
final phase of the plan, we have exclusive rights to develop 16 acres on the
California side of Lake Tahoe adjacent to Harveys Resort. We are currently
working with prospective joint venture partners to evaluate development
opportunities at this location, including a condominium hotel and convention
center development, adjacent timeshare property, retail space, parking
facilities and various public amenities.

    Harveys Casino Hotel and Bluffs Run Casino are within a short drive of the
Omaha/Council Bluffs metropolitan regional airport. Harveys Casino Hotel is
located directly off Interstate 29. Bluffs Run Casino is located at the
intersection of Interstates 80 and 29 and has visibility and exit ramps from
each Interstate. In November 2000, the City of Council Bluffs announced plans to
develop a projected $150 million regional destination recreation and
entertainment attraction called the Mid America Recreation and Convention
Complex, through a partnership of the City of Council Bluffs, the Iowa West
Foundation (an Iowa nonprofit foundation) and the private sector. The complex is
proposed to be developed on approximately 96 acres adjacent to Bluffs Run
Casino. As presently planned, the complex would include a 7,500 seat multi-use
arena, a 33,500 square foot exhibit hall, a 44,000 square foot meeting and
ballroom facility, two hotels, a 20 acre indoor/outdoor aquatic park and
additional retail, restaurant and entertainment venues.

    Harveys Wagon Wheel is located on a highly visible site in Central City,
Colorado, a picturesque mountain town approximately 35 miles west of Denver.
Substantially all recent gaming development in the Central City/Black Hawk area
has occurred in Black Hawk, which visitors from Denver must drive through to
reach Central City. The Central City Business Improvement District is seeking to
construct a southern access road connecting Central City to I-70. If completed
as proposed, the highway will terminate near Central City and will provide
improved four-lane access between the Central City/Black Hawk market and Denver.
The Central City Business Improvement District is finalizing the financing for
the project.

    TARGETED CUSTOMER BASE

    Harveys targets middle-income customers who tend to have disposable income
for gaming and entertainment. We have established extensive customer databases
and use sophisticated player tracking systems to award cash rebates or
promotional allowances, such as complimentary rooms, food, beverage and
entertainment, when gaming play warrants. We attract our targeted market to
Harveys Resort by promoting our quality facilities in the scenic Lake Tahoe
area. We believe we are able to retain customers through development and
cultivation of our customer relationships. Harveys Casino Hotel

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targets frequent, middle income players from Omaha, Council Bluffs and the
surrounding areas. We believe that the hotel and convention facilities attract
new players by capturing overnight guests as well as meetings and small
conventions business. The greyhound facilities at Bluffs Run Casino have been in
existence since 1986 creating very high name recognition in the region. The
casino facilities opened one year prior to any other casino in the area. Since
opening, Bluffs Run Casino has maintained one of the highest slot machine
payback percentages in the nation. This has been publicized in industry
magazines and has generated strong customer loyalty. Harveys Wagon Wheel targets
middle-income customers from the greater Denver area who seek a quality gaming
experience, convenient parking and overnight accommodations. We believe we have
successfully built a loyal customer base at Harveys Wagon Wheel by establishing
ourselves as the first full-service casino with overnight accommodations and
full amenities in the Central City/Black Hawk market.

    EFFECTIVE MARKETING

    We aggressively promote all of our properties through television, radio,
billboard, internet and print advertising.

    Harveys Resort seeks to attract customers by offering well-appointed rooms
and an exciting atmosphere for those seeking nightlife and entertainment.
Harveys Resort's marketing campaign ties Harveys Resort to Lake Tahoe as a
destination. We believe that by continuing to promote Harveys' image, we will
increase our share of higher-income customers attracted to the south Lake Tahoe
market. Harveys Casino Hotel is marketed as "Harveys Casino Hotel, You Can Have
It All!" in the Omaha/Council Bluffs market through the extensive use of
television, radio and print advertisement, billboards, on-going promotions and
sweepstakes as well as point-of-sale materials located in local hotels,
restaurants and other visitor attractions. We use a price point positioning to
differentiate Bluffs Run Casino in the Omaha/Council Bluffs market. Its "Bigger
Value. Better Time." philosophy has helped the property consistently maintain
the highest share of annual slot gaming dollars and highest annual attendance in
the market. We attract customers to Harveys Wagon Wheel by aggressively
promoting the facility's hotel rooms, on-site parking, quality dining facilities
and varied entertainment activities.

    EMPHASIS ON SLOT PLAY

    Responding to the increased popularity of slot machines over the past
several years, we have shifted our gaming mix toward slot machines. We match the
mix of slot machines to the demand of the customer base at each property.
Harveys Resort, for instance, now includes a greater percentage of $1 and higher
denominated machines to appeal to the higher-income gaming clientele of Harveys
Resort, including $5, $25 and $100 slot machines offered within a premium player
section. Harveys Casino Hotel offers 1,220 slot machines and Bluffs Run Casino
offers 1,500 slot machines, which in the aggregate comprise approximately 65% of
the Omaha/Council Bluffs slot machine availability. Harveys Wagon Wheel offers
1,040 slot machines, the second largest selection of slot machines currently
offered by any gaming facility in the area. Slot machines are less labor
intensive and require less square footage than table games, and generate higher
profit margins compared to table games. We monitor payout percentages closely
and ensure that our slot product and machine payouts remain competitive.

COMPETITION

    The gaming industry is highly competitive. Harveys competes for customers
primarily on the basis of location, variety and pricing of amenities and overall
atmosphere. Several of our competitors have substantially greater name
recognition, financial and marketing resources.

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    LAKE TAHOE

    Harveys Resort competes with a number of other hotel/casinos at Lake Tahoe
and, to a lesser extent, with hotel/casino operations located in Reno, Las Vegas
and Laughlin, Nevada and casinos on Native American lands in California. In
south Lake Tahoe, Harveys Resort competes primarily with three other major
casino operations: Harrah's Lake Tahoe, Caesars Tahoe and the Horizon Casino
Resort.

    In 1987, the Tahoe Regional Planning Agency, an entity established under a
bi-state compact between the states of California and Nevada, and ratified by
Congress, placed restrictions on additional commercial, residential and tourist
accommodation construction at Lake Tahoe in an effort to curb development and to
preserve the local environment. Under the Tahoe Regional Planning Compact and
community plan constraints, future tourist accommodation units added to the
market will be required to mitigate environmental impacts. Such measures may
include replacing an imposed multiple of older tourist accommodation units.
However, we believe the limited number of rooms available at Lake Tahoe allows
Lake Tahoe hotel/casino operators to achieve higher average room rates and
occupancy rates than those in most other gaming jurisdictions. The Tahoe
Regional Planning Agency has imposed significant restrictions on construction
and the Tahoe Regional Planning Compact limits the expansion of gaming
facilities in the Lake Tahoe Basin. These restrictions prohibit existing casinos
from expanding cubic volume of structures housing gaming and limit expansion of
the gaming areas within such structures. We believe that because of such
restrictions, it is unlikely that any new hotel/casinos will commence operations
at Lake Tahoe or that any of the smaller existing casinos will expand to a size
that could make them competitive with the four major casinos; however, we expect
that the four major hotel/casinos will continue to compete intensely.

    In addition, as a result of the approval of state proposition 5, the
California Indian Self-Reliance Initiative, in California in November 1998,
additional competition could result from an increase in the number of casinos on
Native American lands in California, including on lands that are between Harveys
Resort and major population centers, such as the San Francisco Bay area, and
proximate to Highway 50, the primary road route to south Lake Tahoe.

    OMAHA/COUNCIL BLUFFS

    The target markets for our two operations in Council Bluffs are the
residential population base (approximately 760,000) of the greater Omaha/Council
Bluffs area, and the nearly three million residents within a three-hour drive of
the facilities. We compete with Ameristar Casino Inc.'s riverboat casino in
Council Bluffs and to a lesser extent, with other riverboat casinos located in
Iowa and Missouri. We also compete with slot machines installed at a dogtrack
and at a horsetrack in Iowa. We compete, as well, with existing casinos on
Native American land in Iowa and may, in the future, compete with any expansion
of these casinos or any additional casinos opened by Native Americans in Iowa or
Nebraska.

    In Iowa, gaming is subject to approval by county referendum at least every
eight years. While gaming is approved in Pottawattamie County, where Harveys
Casino Hotel and Bluffs Run Casino are located, referendums may be held at any
time upon satisfactory petition, and another referendum is required to be held
in 2002. There can be no assurance that gaming would be approved again in any
referendum in Pottawattamie County. In addition, should casino-style gaming be
permitted in Nebraska, or should gaming facilities be opened in Omaha, Harveys
Casino Hotel and Bluffs Run Casino could be materially adversely affected.

    CENTRAL CITY/BLACK HAWK

    Harveys Wagon Wheel competes primarily with the five major casinos with the
largest number of gaming devices in Black Hawk as well as the 25 smaller gaming
establishments in operation as of

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February 11, 2001, in Central City and Black Hawk. The six largest casinos,
including Harveys Wagon Wheel, as of February 11, 2001 had more than 52% of all
gaming devices in the Central City/Black Hawk area. The adjacent cities of
Central City and Black Hawk form Colorado's primary gaming market. In this
market the establishments with on-site parking, overnight accommodations and/or
other non-gaming amenities fair better than those without such amenities.
Substantially all recent casino development in the Central City/Black Hawk area
has occurred in Black Hawk, which visitors from the Denver area must drive
through in order to reach Central City. The Lodge Casino, offering 700 on-site
parking spaces (including 300 spaces shared with the adjacent Gilpin Hotel
Casino) and overnight accommodations in 50 hotel rooms, opened in Black Hawk in
June 1998. The Isle of Capri opened in Black Hawk on December 30, 1998, with
1,100 parking spaces and opened its hotel with 243 rooms in July of 2000. The
Riviera opened in Black Hawk in February 2000 with 520 parking spaces. The Mardi
Gras opened in March 2000 with approximately 700 slots, eight table games and
500 parking spaces. In addition, from time to time, the towns of Central City
and Black Hawk undertake roadway and other infrastructure improvements. Because
the towns are generally accessible only by a single road, these infrastructure
projects may deter gaming customers from visiting the Central City/Black Hawk
area or traveling through Black Hawk to Central City. There can be no assurances
that the development or concentration of casinos or infrastructure improvements
in Black Hawk will not adversely affect the number of gaming customers visiting
Harveys Wagon Wheel in Central City. In addition, the municipal governments of
Central City and Black Hawk compete to attract gaming patrons and gaming
development to their respective towns, including by improving road access. Black
Hawk's financial resources are currently substantially greater than Central
City's and there can be no assurance that Black Hawk will not make improvements
or provide other inducements that would result in reduction of the number of
gaming patrons visiting Harveys Wagon Wheel in Central City. Any expansion of
gaming, whether it be through approval of video lottery terminals or approval of
gaming in additional Colorado communities, would likely have a material adverse
impact on our operation in Central City.

EMPLOYEES

    As of February 12, 2001 the Company had approximately 4,900 employees. We
believe that employee relations are good. The Company has entered into
collective bargaining agreements that cover approximately six employees. These
agreements relate to stage-hand employees who provide support to entertainment
facilities at Harveys Resort and security officers at Bluffs Run Casino. None of
our other employees are represented by labor unions.

REGULATORY MATTERS

    NEVADA GAMING LAWS AND REGULATIONS

    The ownership and operation of casino gaming facilities in Nevada are
subject to the Nevada Gaming Control Act and the regulations promulgated
thereunder (collectively, the "Nevada Act") and various local regulations. Our
gaming operations in Nevada are subject to the licensing and regulatory control
of the Nevada State Gaming Control Board (the "Nevada Board"), and the Nevada
Gaming Commission (the "Nevada Commission"). In this report, we collectively
refer to the Nevada Board, and the Nevada Commission as the "Nevada Gaming
Authorities".

    The laws, regulations and supervisory procedures of the Nevada Gaming
Authorities are based upon declarations of public policy which are concerned
with, among other things:

    (1) the prevention of unsavory or unsuitable persons from having a direct or
       indirect involvement with gaming at any time or in any capacity;

    (2) the establishment and maintenance of responsible accounting practices
       and procedures;

    (3) the maintenance of effective controls over the financial practices of
       licensees, including the establishment of minimum procedures for internal
       fiscal affairs and the safeguarding of assets

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       and revenues, providing reliable record keeping and requiring the filing
       of periodic reports with the Nevada Gaming Authorities;

    (4) the prevention of cheating and fraudulent practices; and

    (5) to provide a source of state and local revenues through taxation and
       licensing fees. Change in these laws, regulations and procedures could
       have an adverse effect on our gaming operations.

    As is any company that operates a Nevada gaming casino we are required to be
licensed by the Nevada Gaming Authorities. The gaming license requires the
periodic payment of fees and taxes and is not transferable. We are also
registered by the Nevada Commission as a publicly traded corporation
("Registered Corporation"). As a Registered Corporation, we are required
periodically to submit detailed financial and operating reports to the Nevada
Commission and furnish any other information which the Nevada Commission may
require. We have obtained from the Nevada Gaming Authorities the various
registrations, approvals, permits and licenses required in order to engage in
gaming activities in Nevada.

    The Nevada Gaming Authorities may investigate any individual who has a
material relationship to, or material involvement with, a Registered Corporation
in order to determine whether such individual is suitable or should be licensed
as a business associate of a gaming licensee. Officers, directors and certain
key employees of a Registered Corporation must file applications with the Nevada
Gaming Authorities and may be required to be licensed or found suitable by the
Nevada Gaming Authorities. The Nevada Gaming Authorities may deny an application
for licensing or a finding of suitability for any cause which they deem
reasonable. A finding of suitability is comparable to licensing, and both
require submission of detailed personal and financial information followed by a
thorough investigation. The applicant for licensing or a finding of suitability
must pay all the costs of the investigation. Changes in licensed positions must
be reported to the Nevada Gaming Authorities and, in addition to their authority
to deny an application for a finding of suitability or licensure, the Nevada
Gaming Authorities have jurisdiction to disapprove a change in a corporate
position.

    If the Nevada Gaming Authorities were to find an officer, director or key
employee unsuitable for licensing or unsuitable to continue having a
relationship with the Company, we would have to sever all relationships with
that person. In addition, the Nevada Commission may require us to terminate the
employment of any person who refuses to file appropriate applications.
Determinations of suitability or of questions pertaining to licensing are not
subject to judicial review in Nevada.

    A Registered Corporation is required to submit detailed financial and
operating reports to the Nevada Commission. Substantially all material loans,
leases, sales of securities and similar financing transactions that a Registered
Corporation enters into must be reported to, or approved by, the Nevada
Commission.

    If it were determined that the Nevada Act was violated by the Company, the
gaming licenses we hold could be limited, conditioned, suspended or revoked,
subject to compliance with certain statutory and regulatory procedures. In
addition, the Company, and the persons involved, could be subject to substantial
fines for each separate violation of the Nevada Act at the discretion of the
Nevada Commission. Further, a supervisor could be appointed by the Nevada
Commission to operate Harveys Resort and, under certain circumstances, earnings
generated during the supervisor's appointment (except for the reasonable rental
value of Harveys Resort) could be forfeited to the State of Nevada. Limitation,
conditioning or suspension of our gaming license or the appointment of a
supervisor could (and revocation of our gaming license would) materially
adversely affect our gaming operations.

    Any beneficial holder of a Registered Corporation's voting securities,
regardless of the number of shares owned, may be required to file an
application, be investigated, and have his or her suitability as a beneficial
holder of a Registered Corporation's voting securities determined if the Nevada
Commission has reason to believe that the ownership would otherwise be
inconsistent with the declared

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policies of the State of Nevada. The applicant must pay all costs of
investigation incurred by the Nevada Gaming Authorities in conducting any such
investigation.

    The Nevada Act requires any person who acquires more than 5% of a Registered
Corporation's voting securities to report the acquisition to the Nevada
Commission. The Nevada Act requires that beneficial owners of more than 10% of a
Registered Corporation's voting securities apply to the Nevada Commission for a
finding of suitability within thirty days after the Chairman of the Nevada Board
mails a written notice requiring the filing. Under certain circumstances, an
"institutional investor," as defined in the Nevada Act, which acquires more than
10%, but not more than 15%, of a Registered Corporation's voting securities may
apply to the Nevada Commission for a waiver of the finding of suitability if the
institutional investor holds the voting securities for investment purposes only.
An institutional investor will not be deemed to hold voting securities for
investment purposes unless the voting securities were acquired and are held in
the ordinary course of business as an institutional investor and not for the
purpose of causing, directly or indirectly, the election of a majority of the
members of the board of directors of the Registered Corporation, any change in
the corporate charter, bylaws, management, policies or operations of the
Registered Corporation, or any of its gaming affiliates, or any other action
which the Nevada Commission finds to be inconsistent with holding the Registered
Corporation's voting securities for investment purposes only. Activities which
are not deemed to be inconsistent with holding voting securities for investment
purposes only include:

    (1) voting on all matters voted on by stockholders;

    (2) making financial and other inquiries of management of the type normally
       made by securities analysts for informational purposes and not to cause a
       change in a Registered Corporation's management, policies or operations;
       and

    (3) such other activities as the Nevada Commission may determine to be
       consistent with such investment intent.

    If the beneficial holder of voting securities who must be found suitable is
a corporation, partnership or trust, it must submit detailed business and
financial information including a list of beneficial owners. The applicant is
required to pay all costs of investigation.

    Any person who fails or refuses to apply for a finding of suitability or a
license within thirty days after being ordered to do so by the Nevada Commission
or the Chairman of the Nevada Board, may be found unsuitable. The same
restrictions apply to a record owner if the record owner, after request, fails
to identify the beneficial owner. Any person found unsuitable and who holds,
directly or indirectly, any beneficial ownership of the common stock of a
Registered Corporation beyond such period of time as may be prescribed by the
Nevada Commission may be guilty of a criminal offense. We are subject to
disciplinary action if, after we receive notice that a person is unsuitable to
be a stockholder or to have any other relationship with the Company, we:

    (1) pay that person any dividend or interest on our voting securities;

    (2) allow that person to exercise, directly or indirectly, any voting right
       conferred through securities held by that person;

    (3) pay remuneration in any form to that person for services rendered or
       otherwise; or

    (4) fail to pursue all lawful efforts to require the person to relinquish
       his or her voting securities for cash at fair market value.

    The Nevada Commission may, in its discretion, require the holder of any debt
or other security of a Registered Corporation to file applications, be
investigated and be found suitable to own the debt or other security if it has
reason to believe that the ownership would be inconsistent with the declared
policies of the State of Nevada. If the Nevada Commission determines that a
person is unsuitable to own a debt or other security, then pursuant to the
Nevada Act, the Registered Corporation can be

                                       9
<PAGE>
sanctioned, including the loss of its approvals, if without the prior approval
of the Nevada Commission, it:

    (1) pays to the unsuitable person any dividend, interest, or any
       distribution whatsoever;

    (2) recognizes any voting right by the unsuitable person in connection with
       those securities;

    (3) pays the unsuitable person remuneration in any form; or

    (4) makes any payment to the unsuitable person by way of principal payment,
       redemption, conversion, exchange, liquidation, or similar transaction.

    A Registered Corporation is required to maintain a current stock ledger in
Nevada which may be examined by the Nevada Gaming Authorities at any time. If
any securities are held in trust by an agent or by a nominee, the record holder
may be required to disclose the identity of the beneficial owner to the Nevada
Gaming Authorities. A failure to make that disclosure may be grounds for finding
the record holder unsuitable. A Registered Corporation is required to render
maximum assistance in determining the identity of the beneficial owner. The
Nevada Commission has the power to require stock certificates of a Registered
Corporation to bear a legend indicating that the securities are subject to the
Nevada Act. However, to date, the Nevada Commission has not imposed that
requirement on the Company.

    A Registered Corporation is restricted from making a public offering of debt
or other securities without the prior approval of the Nevada Commission if the
securities or the proceeds from their sale are intended to be used to construct,
acquire or finance gaming facilities in Nevada, or to retire or extend
obligations incurred for those purposes. The approval, if given, does not
constitute a finding, recommendation or approval by the Nevada Commission or the
Nevada Board as to the accuracy or adequacy of the prospectus or the investment
merits of the securities. Any representation to the contrary is unlawful.

    Changes in control of a Registered Corporation through merger,
consolidation, stock or asset acquisitions, management or consulting agreements,
or any act or conduct by a person by which he or she obtains control, may not
occur without the prior approval of the Nevada Gaming Authorities. Entities
seeking to acquire control of a Registered Corporation must satisfy the Nevada
Board and Nevada Commission in a variety of stringent standards prior to
assuming control of the Registered Corporation. The Nevada Commission may also
require controlling stockholders, officers, directors and other persons having a
material relationship or involvement with the entity proposing to acquire
control to be investigated and licensed as part of the approval process relating
to the transaction.

    The Nevada legislature has declared that some corporate acquisitions opposed
by management, repurchases of voting securities and corporate defense tactics
affecting Nevada corporate gaming licensees, and Registered Corporations that
are affiliated with those operations, may be injurious to stable and productive
corporate gaming. The Nevada Commission has established a regulatory scheme to
ameliorate the potentially adverse effects of these business practices upon
Nevada's gaming industry and to further Nevada's policy to:

    (1) assure the financial stability of corporate gaming operators and their
       affiliates;

    (2) preserve the beneficial aspects of conducting business in the corporate
       form; and

    (3) promote a neutral environment for the orderly governance of corporate
       affairs.

    Approvals are, in certain circumstances, required from the Nevada Commission
before the Registered Corporation can make exceptional repurchases of voting
securities (i.e., repurchases which treat holders differently) above the current
market price and before a corporate acquisition opposed by management can be
consummated. The Nevada Act also requires prior approval of a plan of
recapitalization proposed by the Registered Corporation's Board of Directors in
response to a tender

                                       10
<PAGE>
offer made directly to the Registered Corporation's stockholders for the
purposes of acquiring control of the Registered Corporation.

    License fees and taxes, computed in various ways depending on the type of
gaming or activity involved, are payable to the State of Nevada and to the
counties and cities in which the Nevada licensee's respective operations are
conducted. Depending upon the particular fee or tax involved, these fees and
taxes are payable either monthly, quarterly or annually and are based upon:

    (1) a percentage of the gross revenues received;

    (2) the number of gaming devices operated; or

    (3) the number of table games operated.

    A casino entertainment tax is also paid by casino operations where
entertainment is furnished in connection with the selling of food or
refreshments or the selling of merchandise. Nevada licensees that hold a license
as an operator of a slot route, or a manufacturer's or distributor's license,
also pay certain fees and taxes to the State of Nevada.

    The Nevada state legislature is meeting in biennial session in 2000 and may
consider legislative proposals that affect the computation of fees or taxes
levied on licensees. If legislation increasing the amount of fees or taxes is
successful and becomes law in the future, it would have an adverse effect on the
profitability of our Nevada gaming operations.

    Any person who is licensed, required to be licensed, registered, required to
be registered, or is under common control with such persons (collectively,
"licensees"), and who proposes to become involved in a gaming venture outside of
Nevada is required to deposit with the Nevada Board, and thereafter maintain, a
revolving fund in the amount of $10,000 to pay the expenses of investigation by
the Nevada Board of their participation in such foreign gaming. The revolving
fund is subject to increase or decrease in the discretion of the Nevada
Commission. Thereafter, licensees are required to comply with certain reporting
requirements imposed by the Nevada Act. Licensees are also subject to
disciplinary action by the Nevada Commission if they knowingly violate any laws
of the foreign jurisdiction pertaining to the foreign gaming operation, fail to
conduct the foreign gaming operation in accordance with the standards of honesty
and integrity required of Nevada gaming operations, engage in activities or
associations that are harmful to the State of Nevada or its ability to collect
gaming taxes and fees, or employ, contract with or associate with a person in
the foreign operation who has been denied a license or finding of suitability in
Nevada on the ground of personal unsuitability.

    IOWA GAMING LAWS AND REGULATIONS

    The State of Iowa first authorized excursion gambling boat activities in
1989 and authorized slot machines at racetrack enclosures in 1994. The Iowa
Racing and Gaming Commission (the "Iowa Commission") has the authority to grant
and review licenses to owners and operators of excursion gambling boats and
pari-mutuel racetracks, and has the further authority to adopt and enforce rules
governing a broad range of subjects dealing with excursion gambling boat
facilities and racetrack enclosures and operations. The Iowa Commission consists
of five members who are appointed by the governor and confirmed by the state
senate. Members serve a term not to exceed three years at the pleasure of the
governor.

    Under Iowa law relating to excursion gambling boats, a non-profit
organization and a for-profit organization may receive a joint license to
operate an excursion gambling boat. The Company, together with Iowa West Racing
Association, a qualified non-profit organization, have been granted the
necessary licenses to own and operate the current gambling facilities and
activities on the riverboat casino at Harveys Casino Hotel each year since 1995.
Our excursion boat gambling license, which is up for renewal, currently expires
March 31, 2001.

                                       11
<PAGE>
    Under Iowa law relating to racetracks, only a non-profit organization, an
operator of fairs or a state agency or political subdivision may hold a track
license. Only a licensee which held a license to operate a pari-mutuel racetrack
operation on January 1, 1994, could obtain a racetrack slot casino license when
they became available in 1994. No one can obtain a racetrack slot casino license
today, unless they held a license to operate a pari-mutuel racetrack operation
on January 1, 1994. Iowa West Racing Association, a qualified non-profit
organization, holds the pari-mutuel license to operate the dog track and the
gaming racetrack enclosure license to operate the slot machine casino all at
Bluffs Run Casino. The Bluffs Run pari-mutuel dogtrack license and the Bluffs
Run gambling license for a racetrack enclosure expire December 31, 2001.

    All licenses are granted upon the condition that the license holders accept,
observe and enforce all applicable laws, regulations, ordinances, rules and
orders applicable to them. Any violation by a license holder including its
employees or agents, may result in disciplinary action, including the suspension
or revocation of any license previously granted.

    On October 6, 1999, we completed the purchase of Bluffs Run Casino from Iowa
West Racing Association and paid the seller approximately $115.0 million. We are
obligated to pay additional consideration to the seller of up to $50.0 million,
pending the results of a required referendum on the continuation of gaming at
pari-mutuel racetracks to be decided in 2002 by the voters of Pottawattamie
County, Iowa. We generally are obligated to pay to the seller $45.0 million of
additional consideration plus a $5.0 million bonus unless either the referendum
is not approved or a slots casino cannot continue to be operated at Bluffs Run
Casino under then-applicable law. If we are not obligated to pay the additional
consideration because the referendum was not approved or a challenge to the
referendum exists, but the operation of a slots casino at Bluffs Run Casino can
continue through December 31, 2003 without being interrupted as a result of the
referendum or any referendum challenge, then we are obligated to pay to the
seller $10.0 million on December 31, 2003 and $2.5 million on the last day of
each complete calendar quarter thereafter for the shorter of (i) the period
during which we can continue to operate a slots casino at Bluffs Run Casino and
(ii) a period of eight quarters if referendum approval was not obtained and 16
quarters if we are not obligated to pay the additional consideration because of
a referendum challenge.

    At the closing of the acquisition of Bluffs Run Casino, Harveys Iowa
Management Company, Inc. and Iowa West Racing Association entered into an
amended and restated excursion gambling boat sponsorship and operating agreement
relating to Harveys' operation of its excursion gambling boat casino. The
operating agreement's term continues through December 31, 2010, and during the
agreement, Harveys is to pay Iowa West Racing Association a fee equal to a
percentage of the adjusted gross gaming receipts generated from the boat
operation and further agreed to pay and hold Iowa West Racing Association
harmless from the admissions fee payable to the Iowa Commission and the local
municipality and state wagering tax imposed by Iowa law. Following the
expiration of the term of the operating agreement, such agreement may be
extended for five successive three-year periods.

    Also, on October 6, 1999, Harveys BR Management Company and Iowa West Racing
Association entered into a management agreement whereby Harveys BR Management
Company is to manage the pari-mutuel racetrack facility and casino operations
including simulcast of greyhound or horse racing and the slot machines for a
minimum of 25 years, during which Harveys is to receive a management fee equal
to a percentage of the cash flow as that term is defined in the management
agreement. On the same day, October 6, 1999, HBR Realty Company purchased the
Bluffs Run Casino assets, except for the slot machines, from Iowa West Racing
Association and leased the same back to Iowa West Racing Association for an
initial term ending October 5, 2024, which lease is renewable for additional
terms by the mutual agreement of the parties. Harveys is to receive rent
payments equal to a percentage of cash flow as that term is defined in the lease
agreement, except that Iowa West Racing Association is entitled to $1,350,000 of
cash flow payable every six months in arrears following the acquisition until
the fifth business day following the date that the results of the required
referendum on the

                                       12
<PAGE>
continuation of gaming at pari-mutuel racetracks, as described above, are
certified to the County Auditor of Pottawattamine County. Under the terms of the
management and lease agreements, Harveys receives management fees and lease
income generally equal to the ongoing cash flow from the operations of Bluffs
Run Casino. All of the agreements outlined here were approved by the Iowa
Commission in September 1999.

    Under Iowa law, gambling licenses may only be granted by the Iowa Commission
in those counties that have approved the conduct of gambling games in a
county-wide referendum. Gambling games, both at a racetrack enclosure and on
riverboats, have been approved by the county electorate in Pottawattamie County,
Iowa, the location of both Harveys Casino Hotel and Bluffs Run Casino.

    However, a referendum can be requested at any time by a petition of the
voters and must be reapproved for both types of gambling activities via the
general election ballot eight years after the initial approval and each eight
years thereafter. There can be no assurance that either type of gambling
activities will be approved at the next referendum to be held in November 2002,
in subsequent referenda held every eight years thereafter or in the event of a
petition referendum.

    If the gambling referenda do not pass in the county where the licenses are
held, the excursion gambling boat licenses may remain valid, as described below,
for a total of nine years from the date of original issue which, in the case of
Harveys, would be nine years from January 27, 1995, or January 26, 2004.
Currently, the excursion gambling boat license with respect to Harveys Casino
Hotel is renewed annually in April. The license that may be issued in
April 2002, under current law, could remain valid following a referendum defeat
in November 2002, and the Iowa Commission could renew the license in April 2003
so that such license would be valid until January 26, 2004.

    Racetracks do not have a similar original license concept allowing them to
operate via renewals by the Iowa Commission until the expiration of nine years
from the date they were first licensed. In the event a negative referendum vote
occurred in 2002, Bluffs Run Casino would have to cease casino gaming operations
in a relatively short time following the referendum defeat, probably pursuant to
an order of the Iowa Commission.

    Following the issuance of a gaming license, the Iowa Commission monitors and
supervises the activities of the licensee. Material contracts to be entered into
by the licensee, changes in ownership of the licensee, management contracts, and
acquisitions of interest in other gambling activities by the licensee or its
owners must all be reported to, and approved by, the Iowa Commission. Further,
the Iowa Commission has the authority to:

    (1) determine the payouts from the gambling games;

    (2) determine race schedules;

    (3) set the payout rate for all slot machines;

    (4) establish minimum charges for admission to excursion gambling boats;

    (5) impose an admission fee or a head tax;

    (6) define the excursion season and the duration of an excursion; and

    (7) define the race season and total number of races to be held.

    For excursion gambling boats, Iowa law authorizes the imposition of an
admission fee, set by and payable to the Iowa State Treasurer, on each person
embarking on an excursion gambling boat. An additional admission fee may be
imposed by the municipality in which the gambling operation is located. In
practice, the Iowa Commission has not imposed a per-person admission fee, but
rather has imposed a fee on each excursion gambling boat based upon the
estimated costs of supervision and enforcement to be incurred by the Iowa
Commission for the ensuing fiscal year. For the fiscal year

                                       13
<PAGE>
beginning July 1, 2000, the fee is $378,701, payable in weekly installments of
$7,283. A $0.50 per person admission fee is also payable to the City of Council
Bluffs, Iowa. Further, Iowa law imposes an annual wagering tax ranging from 5%
on the first $1.0 million of adjusted gross receipts from gambling games to 20%
on adjusted gross receipts in excess of $3.0 million.

    For dog tracks, Iowa law requires the payment of a licensing fee of $200 for
each racing day. In addition, a licensee is required to pay the State of Iowa
the sum of $.50 for each person entering the racetrack grounds or enclosure.
There is also a wagering tax imposed on the gross sum wagered at the dog track
at the following rate:

    (1) 6% if the gross sum wagered in the racing season is $55.0 million or
       more;

    (2) 5% if the gross sum wagered in the racing season is $30.0 million or
       more, but less that $55.0 million;

    (3) 4% if the gross sum wagered in the racing season is less than
       $30.0 million.

    For pari-mutuel slot casinos there is an escalating wagering tax which is
currently 30% of the gross receipts from the slot machine casino which rate goes
up two percent per year every January 1 until it reaches a maximum of 36% on
January 1, 2004.

    The Racing Association of Central Iowa which operates the horse track in
Altoona (Des Moines), Iowa, brought an action on June 25, 1998, in the Iowa
District Court, in and for Polk County, alleging that the escalating racetrack
casino tax violates the United States and Iowa Constitutions. The Dubuque Racing
Association, Ltd (licensee of the Dubuque dog track), the Iowa West Racing
Association (licensee of the Bluffs Run Casino), and the Iowa Greyhound
Association also joined as plaintiffs in the case. In December 2000, the Iowa
District Court rejected the plaintiffs constitutional challenge. The plaintiffs
have appealed to the Iowa Supreme Court.

    Excursion gambling boat activities are also subject to safety and inspection
requirements of the State of Iowa and the U.S. Coast Guard. These requirements:

    (1) set limits on the operation of the vessel;

    (2) mandate that it must be operated by a minimum complement of licensed
       personnel;

    (3) establish periodic inspections, including the physical inspection of the
       outside hull; and

    (4) establish other mechanical and operations rules.

    COLORADO GAMING LAWS AND REGULATIONS

    The State of Colorado created the Division of Gaming (the "Colorado
Division") within the Department of Revenue to license, implement, regulate and
supervise the conduct of limited gaming under the Colorado Limited Gaming Act.
The Director of the Colorado Division (the "Colorado Director"), pursuant to
regulations promulgated by, and subject to the review of, a five-member Colorado
Limited Gaming Control Commission (the "Colorado Commission"), has been granted
broad power to ensure compliance with the Colorado gaming laws and regulations
(the "Colorado Regulations"). The Colorado Director may inspect, without notice,
impound or remove any gaming device. The Colorado Director may examine and copy
any licensee's records, may investigate the background and conduct of licensees
and their employees, and may bring disciplinary actions against licensees and
their employees. The Colorado Director may also conduct detailed background
investigations of persons who loan money to, or otherwise provide financing to,
a licensee.

    The Colorado Commission is empowered to issue five types of gaming and
gaming-related licenses, and has delegated authority to the Colorado Director to
issue certain types of licenses and approve certain changes in ownership. The
licenses are revocable and non-transferable. Harveys Wagon Wheel's

                                       14
<PAGE>
failure or inability, or the failure or inability of others associated with
Harveys Wagon Wheel to maintain necessary gaming licenses or approvals would
have a material adverse effect on our operations. All persons employed by
Harveys Wagon Wheel and involved, directly or indirectly, in gaming operations
in Colorado also are required to obtain a Colorado gaming license. All licenses
must be renewed annually, except those held by key and support employees, which
must be renewed every two years.

    As a general rule, under the Colorado Regulations, no person may have an
"ownership interest" in more than three retail gaming licenses in Colorado. The
Colorado Commission has ruled that a person does not have an ownership interest
in a retail licensee for purposes of the multiple license prohibition if:

    (1) that person has less than a 5% ownership interest in an institutional
       investor which has an ownership interest in a publicly traded licensee or
       publicly traded company affiliated with a licensee;

    (2) a person has a 5% or more ownership interest in an institutional
       investor, but the institutional investor has less than a 5% ownership
       interest in a publicly traded licensee or publicly traded company
       affiliated with a licensee;

    (3) an institutional investor has less than a 5% ownership interest in a
       publicly traded licensee or publicly traded company affiliated with a
       licensee;

    (4) an institutional investor possesses voting securities in a fiduciary
       capacity for another person and does not exercise voting control over 5%
       or more of the outstanding voting securities of a publicly traded
       licensee or publicly traded company affiliated with a licensee;

    (5) a registered broker or dealer retains possession of voting securities of
       a publicly traded licensee or publicly traded company affiliated with a
       licensee for its customers in street name or otherwise, and exercises
       voting rights for less than 5% of the outstanding voting securities of
       the publicly traded licensee or publicly traded company affiliated with a
       licensee;

    (6) a registered broker or dealer acts as a market maker for the stock of a
       publicly traded licensee or publicly traded company affiliated with a
       licensee and possesses a voting interest in less than 5% of the
       outstanding voting securities of the publicly traded licensee or publicly
       traded company affiliated with a licensee;

    (7) an underwriter is holding securities of a publicly traded licensee or
       publicly traded company affiliated with a licensee as part of an
       underwriting for no more than 90 days after the beginning of such
       underwriting if it exercises voting rights of less than 5% of the
       outstanding voting securities of a publicly traded licensee or publicly
       traded company affiliated with a licensee;

    (8) a book entry transfer facility holds voting securities for third
       parties, if it exercises voting rights with respect to less than 5% of
       the outstanding voting securities of a publicly traded licensee or of a
       publicly traded company affiliated with a licensee; or

    (9) a person owns less than 5% of the outstanding voting securities of the
       publicly traded licensee or publicly traded company affiliated with a
       licensee.

    Hence, our business opportunities in Colorado and those of persons with an
"ownership interest" in us, are limited to interests that comply with the
Colorado Regulations and the Colorado Commission's ruling.

    In addition, pursuant to the Colorado Regulations, no manufacturer or
distributor of slot machines or associated equipment may, without notification
being provided to the Colorado Division within 10 days, knowingly have an
interest in any casino operator, allow any of its officers or any other person

                                       15
<PAGE>
with a substantial interest in such business to have such an interest, employ
any person if that person is employed by a casino operator, or allow any casino
operator or person with a substantial interest therein to have an interest in a
manufacturer's or distributor's business. A "substantial interest" means the
lesser of (i) as large an interest in an entity as any other person or (ii) any
financial or equity interest equal to or greater than 5 percent. The Colorado
Commission has ruled that a person does not have a "substantial interest" if
such person's sole ownership interest in such licensee is through the ownership
of less than 5% of the outstanding voting securities of a publicly traded
licensee or publicly traded affiliated company of a licensee.

    Counsel for the Colorado Division has informed counsel for Harveys that, for
purposes of the manufacturer/operator vertical integration rule and the
horizontal three-license rule described above, the Colorado Division has taken
the position that only a person deemed to have "beneficial ownership" (as
defined in Section 13(d) of the Exchange Act and the rules and regulations
thereunder) of shares of the publicly traded licensee or publicly traded company
affiliated with the licensee will be deemed to have an "interest" under the
vertical integrating rule or an "ownership interest" under the horizontal
three-license rule. However, neither the Colorado Commission nor the Colorado
Legislature has addressed these issues. As a result there is no assurance that
the Colorado Division, the Colorado Commission or the Colorado Legislature will
not apply a more restrictive interpretation.

    Under the Colorado Regulations, any person or entity having any direct or
indirect interest in a gaming licensee or an applicant for a gaming license,
including, but not limited to, us and our security holders, may be required to
supply the Colorado Commission with substantial information, including, but not
limited to, background information, source of funding information, a sworn
statement that the person or entity is not holding his or her interest for any
other party, and fingerprints. Such information, investigation and licensing (or
finding or suitability) as an "associated person" automatically will be required
of all persons (other than certain institutional investors discussed below)
which directly or indirectly beneficially own 10% or more of a direct or
indirect beneficial ownership or interest in Harveys Wagon Wheel, through their
beneficial ownership of any class of voting securities of the Company. Those
persons must report their interest within 10 days and file appropriate
applications within 45 days after acquiring that interest. Persons who directly
or indirectly beneficially own 5% or more (but less than 10%) of a direct or
indirect beneficial ownership or interest in Harveys Wagon Wheel, through their
beneficial ownership of any class of voting securities of the Company, must
report their interest to the Colorado Commission within 10 days after acquiring
that interest and may be required to provide additional information and to be
found suitable. (It is the current practice of the gaming regulators to require
findings of suitability for persons beneficially owning 5% or more of a direct
or indirect beneficial ownership or interest, other than certain institutional
investors discussed below.) If certain institutional investors provide specified
information to the Colorado Commission and are holding for investment purposes
only, those investors, at the Colorado Commission's discretion, may be permitted
to own up to 14.99% of Harveys Wagon Wheel, through their beneficial ownership
of any class of voting securities of the Company before being required to be
found suitable. All licensing and investigation fees will have to be paid by the
person in question. The associated person investigation fee currently is $51 per
hour.

    The Colorado Regulations define a "voting security" to be a security, the
holder of which is entitled to vote generally for the election of a member or
members of the board of directors or board of trustees of a corporation or a
comparable person or persons of another form of business organization.

                                       16
<PAGE>
    The Colorado Commission also has the right to request information from any
person directly or indirectly interested in, or employed by, a licensee, and to
investigate the moral character, honesty, integrity, prior activities, criminal
record, reputation, habits and associations of:

    (1) all persons licensed pursuant to the Colorado Limited Gaming Act,

    (2) all officers, directors and stockholders of a licensed privately held
       corporation,

    (3) all officers, directors and stockholders holding either a 5% or greater
       interest or a controlling interest in a licensed publicly traded
       corporation,

    (4) all general partners and all limited partners of a licensed partnership,

    (5) all persons which have a relationship similar to that of an officer,
       director or stockholder of a corporation (such as members and managers of
       a limited liability company),

    (6) all persons supplying financing or loaning money to any licensee
       connected with the establishment or operations of limited gaming,

    (7) all persons having a contract, lease or ongoing financial or business
       arrangement with any licensee, where such contract, lease or arrangement
       relates to limited gaming operations, equipment, devices or premises, and

    (8) all persons contracting with or supplying any goods and services to the
       gaming regulators.

    Certain public officials and employees are prohibited from having any direct
or indirect interest in a license or limited gaming.

    In addition, under the Colorado Regulations, every person who is a party to
a "gaming contract" or lease with an applicant for a license, or with a
licensee, upon the request of the Colorado Commission or the Colorado Director,
must promptly provide to the Colorado Commission or Colorado Director all
information which may be requested concerning financial history, financial
holdings, real and personal property ownership, interests in other companies,
criminal history, personal history and associations, character, reputation in
the community, and all other information which might be relevant to a
determination of whether a person would be suitable to be licensed by the
Colorado Commission. Failure to provide all information requested constitutes
sufficient grounds for the Colorado Commission or the Colorado Director to
require a licensee or applicant to terminate its "gaming contract" (as defined
below) or lease with any person who failed to provide the information requested.
In addition, the Colorado Commission or the Colorado Director may require
changes in "gaming contracts" before an application is approved or participation
in the contract is allowed. A "gaming contract" is defined as an agreement in
which a person does business with or on the premises of a licensed entity.

    Except under limited circumstances relating to slot machine manufacturers
and distributors, every person supplying goods, equipment, devices or services
to any licensee in return for payment of a percentage, or calculated upon a
percentage, of limited gaming activity or income must obtain an operator's
license or be listed on the retailer's license where such limited gaming will
take place. With respect to the foregoing requirement, it is the current
practice of the Colorado Division to require manufacturers and distributors to
obtain an operator's license if the limited exceptions do not apply to them and
to require other persons to be listed as associated persons on the license of
the applicable retailer.

    An application for licensure or suitability may be denied for any cause
deemed reasonable by the Colorado Commission or the Colorado Director, as
appropriate. Specifically, the Colorado Commission and the Colorado Director
must deny a license to any applicant who among other things:

    (1) fails to prove by clear and convincing evidence that the applicant is
       qualified;

                                       17
<PAGE>
    (2) fails to provide information and documentation requested;

    (3) fails to reveal any fact material to qualification, or supplies
       information which is untrue or misleading as to a material fact
       pertaining to qualification;

    (4) has been convicted of, or has a director, officer, general partner,
       stockholder, limited partner or other person who has a financial or
       equity interest in the applicant who has been convicted of, specified
       crimes, including the service of a sentence upon conviction of a felony
       in a correctional facility, city or county jail, or community
       correctional facility or under the state board of parole or any probation
       department within ten years prior to the date of the application,
       gambling-related offenses, theft by deception or crimes involving fraud
       or misrepresentation, is under current prosecution for such crimes
       (during the pendency of which license determination may be deferred), is
       a career offender or a member or associate of a career offender cartel,
       or is a professional gambler; or

    (5) has refused to cooperate with any state or federal body investigating
       organized crime, official corruption or gaming offenses.

    If the Colorado Commission determines that a person or entity is unsuitable
to directly or indirectly own interests in the Company then we may be
sanctioned, which may include the loss of our approvals and licenses.

    The Colorado Commission does not need to approve in advance a public
offering of securities but rather requires a filing of notice and additional
documents with regard to a public offering of voting securities prior to such
public offering. The Colorado Commission may, in its discretion, require
additional information and prior approval of such public offering.

    In addition, the Colorado Regulations prohibit a licensee or affiliated
company thereof, such as the Company, from paying any unsuitable person any
dividend or interest upon any voting securities or any payments of distributions
of any kind (except as set forth below), or paying any unsuitable person any
remuneration for services, or recognizing the exercise of any voting rights by
any unsuitable person. Further, under the Colorado Regulations, Harveys Wagon
Wheel may repurchase its voting securities from anyone found unsuitable at the
lesser of the cash equivalent to the original investment in Harveys Wagon Wheel
or the current market price as of the date of the finding of unsuitability
unless such voting securities are transferred to a suitable person (as
determined by the Colorado Commission) within 60 days after the finding of
unsuitability. A licensee or affiliated company must pursue all lawful efforts
to require an unsuitable person to relinquish all voting securities, including
by purchasing such voting securities. The Staff for the Colorado Division has
taken the position that a licensee or affiliated company may not pay any
unsuitable person any interest, dividend or other payments with respect to
non-voting securities, other than with respect to pursuing all lawful efforts to
require such unsuitable person to relinquish such non-voting securities,
including by purchasing or redeeming such securities. Further, the regulations
require anyone with a material involvement with a licensee, including a director
or officer of a holding company, such as the Company, to file for a finding of
suitability if required by the Colorado Commission.

    Because of their authority to deny an application for a license or
suitability, the Colorado Commission and the Colorado Director effectively can
disapprove a change in corporate position of a licensee and with respect to any
entity which is required to be found suitable, or indirectly can cause us to
suspend or dismiss managers, officers, directors and other key employees or
sever relationships with other persons who refuse to file appropriate
applications or whom the authorities find unsuitable to act in such capacities.

    The sale, lease, purchase, conveyance or acquisition of a controlling
interest in Harveys Wagon Wheel is subject to the approval of the Colorado
Commission. Under some circumstances, we may not

                                       18
<PAGE>
sell any interest in our Colorado gaming operations without the prior approval
of the Colorado Commission.

    Harveys Wagon Wheel must meet specified architectural requirements, fire
safety standards and standards for access for disabled persons. Harveys Wagon
Wheel also must not exceed specified gaming square footage limits as a total of
each floor and the full building. The casino at Harveys Wagon Wheel may operate
only between 8:00 a.m. and 2:00 a.m. and may permit only individuals 21 years or
older to gamble in the casino. It may permit slot machines, blackjack and poker,
with a maximum single bet of $5.00. Harveys Wagon Wheel may not provide credit
to its gaming patrons.

    A licensee is required to provide information and file periodic reports with
the Colorado regulators, including identifying those who have 5% or greater
ownership, financial or equity interest in the licensee, or who have the ability
to control the licensee, or who have the ability to exercise significant
influence over the licensee, or who loan money or other things of value to a
licensee, or who have a right to share in revenues of limited gaming, or to whom
any interest or share in profits of limited gaming has been pledged as security
for a debt or performance of an act. A licensee, and any parent company or
subsidiary company of a licensee, who has applied to a foreign jurisdiction for
licensure or permission to conduct gaming, or who possesses a license to conduct
foreign gaming, is required to notify the Colorado regulators. Any person
licensed by the Colorado Commission and any associated person of a licensee must
report criminal convictions and criminal charges to the Colorado regulators.

    The Colorado regulators have broad authority to sanction, fine, suspend and
revoke licenses for violations of the Colorado Regulations. Violations of many
provisions of the Colorado Regulations also can result in criminal penalties.

    The Colorado Constitution currently permits gaming only in a limited number
of cities and some commercial districts.

    The Colorado Constitution permits a gaming tax of up to 40% on adjusted
gross gaming proceeds, and authorizes the Colorado Commission to change the rate
annually. The current gaming tax rate is 0.25% on adjusted gross gaming proceeds
of up to and including $2.0 million, 2% over $2.0 million up to and including
$4.0 million, 4% over $4.0 million up to and including $5.0 million, 11% over
$5.0 million up to and including $10.0 million, 16% over $10.0 million up to and
including $15.0 million and 20% on adjusted gross gaming proceeds in excess of
$15.0 million. Central City has imposed an annual device fee of $1,265 per
gaming device and may revise such fee from time to time.

    In November 2000, voters approved a law that would allow Colorado to
participate in multi-state lotteries.

    The sale of alcoholic beverages is subject to licensing, control and
regulation by the Colorado Liquor Agencies. All persons who directly or
indirectly hold a 10% or more interest in, or 10% or more of the issued and
outstanding capital stock of Harveys Wagon Wheel, through their ownership of
Harveys, must file applications and possibly be investigated by the Colorado
Liquor Agencies. The Colorado Liquor Agencies also may investigate those persons
who, directly or indirectly, loan money to or have any financial interest in
liquor licensees. In addition, there are restrictions on stockholders, directors
and officers of liquor licensees from being a stockholder, director, officer or
otherwise interested in some persons lending money to liquor licensees or from
making loans to other liquor licensees. All licenses are revocable and
transferable only in accordance with all applicable laws. The Colorado Liquor
Agencies have the full power to limit, condition, suspend or revoke any liquor
license and any disciplinary action could (and revocation would) have a material
adverse effect upon the operations of Harveys Wagon Wheel. Harveys Wagon Wheel
holds a hotel and restaurant liquor license for its casino hotel and restaurant
operations, rather than a gaming tavern license. Accordingly, no person directly
or indirectly interested in Harveys Wagon Wheel may be directly or indirectly
interested

                                       19
<PAGE>
in most other types of liquor licenses, and specifically cannot be directly or
indirectly interested in an entity which holds a gaming tavern license.

ENVIRONMENTAL MATTERS

    We are subject to various federal, state and local laws, ordinances and
regulations which (i) govern activities or operations that may have adverse
environmental effects, such as discharges to air and water, as well as handling
and disposal of hazardous materials or solid or hazardous wastes, or (ii) may
impose joint and several liability on current and former property owners or
operators for the costs of investigation, removal or remediation of certain
hazardous substances or wastes released to the environment without regard to
fault. We believe we are in material compliance with these laws.

    Harveys Wagon Wheel is in the vicinity of the Central City/Clear Creek
Superfund Site as designated by the Environmental Protection Agency (the "EPA")
pursuant to the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended ("CERCLA" or "Superfund"). The Central
City/Clear Creek Superfund Site, the overall boundaries of which have not been
explicitly defined, includes numerous specifically identified areas of mine
tailings and other waste piles from former gold mine operations that are the
subject of ongoing investigation and cleanup by the EPA and the State of
Colorado. CERCLA requires cleanup of sites from which there has been a release
or threatened release of hazardous substances and authorizes the EPA to take any
necessary response actions at Superfund sites, including ordering potentially
responsible parties to clean up or contribute to the cleanup of a Superfund
site. Potentially responsible parties are broadly defined under CERCLA, and
include past and present owners and operators of a site. Courts have interpreted
CERCLA to impose strict, joint and several liability upon all persons liable for
response costs.

    In the course of developing Harveys Wagon Wheel, investigations at the site
were conducted in accordance with requirements of governmental authorities as a
prerequisite to obtaining necessary development permits. The investigations were
completed and the requisite permits issued. Currently, the EPA has not
identified any mine tailings or other waste piles at Harveys Wagon Wheel.
Nonetheless, there is the potential that the EPA or other governmental
authorities could broaden their investigations and identify additional areas,
including the Harveys Wagon Wheel site, for cleanup as part of the Central
City/Clear Creek Superfund Site. If the Harveys Wagon Wheel site were included
in the EPA's investigation and designated as an additional area within the
Central City/Clear Creek Superfund Site, we may be identified as potentially
responsible party and any liability we may have related to the Central
City/Clear Creek Superfund Site could have a material adverse effect on the
Company.

ITEM 2. PROPERTIES

    Harveys Resort comprises approximately 1,020,000 square feet on
approximately 19.8 acres, of which we own approximately 5.4 acres and lease
approximately 14.4 acres pursuant to several ground leases that expire in 2045.
A 973,000-square foot parking garage and certain other amenities are located on
leased property.

    Harveys Casino Hotel is located on approximately 36 acres of land owned by
the Company. The land-based amenities, including a covered "skywalk" to the
riverboat casino, are comprised of a hotel, convention center, and passenger
staging area, totaling nearly 300,000 square feet. Contiguous thereto is a
24-acre leasehold parcel which contains the boat docking facility and the 1,630
space parking structure. This parcel is subject to a long term lease with the
City of Council Bluffs for a nominal annual sum. Additionally, we own an
adjacent 44-acre parcel suitable for expansion or support facilities.

    Bluffs Run Casino is located on approximately 72.5 acres of land owned by
the Company. The racetrack grandstand, casino and food and beverage operations
are in a three story building encompassing approximately 109,000 square feet.
There is also a recreation vehicle park capable of

                                       20
<PAGE>
accommodating 115 vehicles and surface parking for 3,117 vehicles on the site.
All of the facilities have been leased back to Iowa West Racing Association.

    The Harveys Wagon Wheel hotel and casino facility encompasses approximately
200,000 square feet on approximately 1.1 acres and a 530-space self-parking
garage on a contiguous 8-acre parcel. Additionally, we own approximately 40
acres of undeveloped land adjacent to the Harveys Wagon Wheel facility.

    All of the real property described above, as well as the Company's personal
property at these operations, is pledged as security for our reducing, revolving
credit facility with a consortium of banks. See footnote 4 to our consolidated
financial statements appearing elsewhere in this report.

ITEM 3. LEGAL PROCEEDINGS

    We are a defendant in various lawsuits relating to routine matters
incidental to our business. We do not believe that the outcome of any
litigation, individually or in the aggregate, will have a material adverse
effect on the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    There were no matters submitted to a vote of security holders during the
fourth quarter of fiscal 2000.

                                       21
<PAGE>
                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    There is no public market for our common equity securities.

    As of February 20, 2001, there were ten holders of the Company's Class A
Common Stock and ten holders of the Company's Class B Common Stock.

    For the fiscal year prior to the Colony/Harveys merger Harveys paid regular
quarterly dividends of $0.05 per share of common stock. Following the
Colony/Harveys merger, the Company has not declared any cash dividends on either
class of its common equity. In addition, the terms of our bank credit facility
prohibit us from paying cash dividends unless our leverage ratio (as calculated
by reference to our ratio of total indebtedness to earnings before interest,
taxes, depreciation and amortization) is less than or equal to 3 to 1.
Consequently, it is unlikely that we will pay any cash dividends on our common
stock in the near future. See "ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
THE COMPANY'S FINANCIAL CONDITION AND RESULTS OF OPERATIONS--Liquidity and
Capital Resources".

ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA

    The following table presents selected consolidated financial data of the
Company as of and for each of the five fiscal years in the period ended
November 30, 2000 (of which fiscal years ended November 30, 1996, 1997 and 1998
and the period from December 1, 1998 through February 1, 1999 represents the
predecessor company prior to the Colony/Harveys merger). For comparative
purposes, we have presented results for fiscal 1999 on a combined twelve month
basis by aggregating results for the period December 1, 1998 through
February 1, 1999 with our results for the period from the Colony/ Harveys merger
acquisition date, February 2, 1999, through November 30, 1999. Our results for
periods after the Colony/Harveys merger are presented on a different basis of
accounting from those for periods before the Colony/Harveys merger, due to the
application of purchase method accounting. However, we believe that comparisons
of the financial results for the fiscal years can still provide a meaningful
discussion of our financial performance.

    On October 6, 1999, we purchased the net assets (except the gaming
equipment) of Bluffs Run Casino. Immediately after the closing of the
transaction, we leased the facilities back to the seller for an initial term of
25 years. At the same time, the seller retained us to manage Bluffs Run Casino
for all periods during which the lease exists. We receive management fees and
lease income generally equal to the ongoing cash flow from the operations of
Bluffs Run Casino. The results of operations of Bluffs Run Casino are included
in the following selected consolidated financial data from the date of
acquisition, October 6, 1999.

    Until October 24, 1997, Harveys owned a 40% equity interest in Hard Rock
Hotel, Inc., which owns the Hard Rock Hotel and Casino in Las Vegas, Nevada.
Harveys also managed the Hard Rock Hotel and Casino pursuant to a contract with
Hard Rock Hotel, Inc. On October 24, 1997, Harveys sold its 40% equity interest
and its interest in the management contract to Hard Rock Hotel, Inc. The
following selected consolidated financial date includes the fees earned for
managing the operations of the Hard Rock Hotel and Casino and Harveys' 40%
equity interest in the income of the Hard Rock Hotel and Casino through
October 24, 1997, the date of the sale.

    The selected consolidated financial data is not necessarily indicative of
our future results of operations or financial condition, and should be read in
conjunction with ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE COMPANY'S
FINANCIAL CONDITION AND RESULTS OF OPERATIONS and with our consolidated
financial statements, including the footnotes, appearing elsewhere in this
report. Certain reclassifications have been made to the prior years' selected
consolidated financial data to conform to the current year presentation. These
reclassifications have no effect on net income.

                                       22
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                                            YEARS ENDED NOVEMBER 30,
                                                              ----------------------------------------------------
                                                                1996       1997       1998       1999       2000
                                                              --------   --------   --------   --------   --------
                                                                             (DOLLARS IN THOUSANDS)
<S>                                                           <C>        <C>        <C>        <C>        <C>
CONSOLIDATED STATEMENT OF INCOME DATA
Revenues
  Casino....................................................  $186,369   $216,564   $244,784   $270,470   $378,396
  Racing....................................................        --         --         --        932      6,045
  Lodging...................................................    28,746     32,175     34,273     36,960     37,863
  Food and beverage.........................................    39,852     44,406     47,079     51,097     59,688
  Other.....................................................     6,402      7,277      7,111      8,260     10,128
  Management fees and joint venture.........................     5,023      4,507         --         --         --
  Less casino promotional allowances........................   (18,643)   (21,366)   (23,738)   (27,416)   (30,032)
                                                              --------   --------   --------   --------   --------
    Total net revenues......................................   247,749    283,563    309,509    340,303    462,088
                                                              --------   --------   --------   --------   --------
Costs and expenses
  Casino....................................................    86,732    100,500    115,837    132,487    182,882
  Racing....................................................        --         --         --      1,859     11,932
  Lodging...................................................    11,677     13,374     13,710     13,046     13,114
  Food and beverage.........................................    24,797     29,886     30,143     31,918     42,015
  Other operating...........................................     2,813      2,811      2,885      3,329      4,130
  Selling, general and administrative.......................    67,128     73,945     78,987     77,473     95,027
  Depreciation and amortization.............................    16,482     19,077     20,796     26,164     38,110
  Development project write-downs...........................        --      2,690         96      2,182      1,314
  Pre-opening expenses......................................     4,099         --         --         --         --
  Colony/Harveys merger costs and consent fees..............        --         --      1,218     19,879         --
  Costs related to terminated merger........................        --         --         --         --      9,904
                                                              --------   --------   --------   --------   --------
    Total costs and expenses................................   213,728    242,283    263,672    308,337    398,428
                                                              --------   --------   --------   --------   --------
Operating income............................................    34,021     41,280     45,837     31,966     63,660
Interest expense, net (1)...................................    14,195     18,892     15,576     26,827     37,689
Gain on sale of interests in unconsolidated affiliate.......        --     27,422         --         --         --
Other income (expense), net.................................      (221)      (137)      (142)      (473)      (514)
                                                              --------   --------   --------   --------   --------
Income before income taxes, extraordinary item and
  cumulative effect of an accounting change.................    19,605     49,673     30,119      4,666     25,457
Income tax provision........................................    (7,791)   (18,898)   (11,417)    (4,230)   (10,627)
                                                              --------   --------   --------   --------   --------
Income before extraordinary item and cumulative effect of an
  accounting change.........................................    11,814     30,775     18,702        436     14,830
Loss on early retirement of debt, net of taxes..............      (522)        --         --       (869)        --
Cumulative effect of an accounting change, net of taxes.....        --         --         --         --     (3,142)
                                                              --------   --------   --------   --------   --------
Net income (loss)...........................................  $ 11,292   $ 30,775   $ 18,702   $   (433)  $ 11,688
                                                              ========   ========   ========   ========   ========

OTHER OPERATING DATA
  EBITDA (2)................................................  $ 54,602   $ 63,047   $ 67,947   $ 81,359   $114,835
  Net cash provided by operating activities.................    39,768     44,637     38,388     42,063     52,657
  Net cash provided by (used in) investing activities.......   (55,502)    24,428    (27,590)  (123,440)   (20,578)
  Net cash provided by (used in) financing activities.......    26,363    (35,151)     1,467     46,575    (35,930)
  Capital expenditures (3)..................................    72,395     22,532     17,681     30,556     18,619

CONSOLIDATED BALANCE SHEET DATA
  Cash and cash equivalents.................................  $ 21,121   $ 55,035   $ 67,299   $ 32,496   $ 28,646
  Total assets..............................................   393,768    403,465    424,158    673,920    649,293
  Long-term debt, net.......................................   181,354    150,220    150,000    400,577    364,004
  Redeemable preferred stock................................        --         --         --     61,442     70,167
  Stockholders' equity......................................   149,763    179,358    200,454     81,355     84,320
</TABLE>

------------------------------

NOTES TO SELECTED CONSOLIDATED FINANCIAL DATA:

(1) Net of amounts capitalized and interest income.

(2) EBITDA is calculated as earnings before interest, taxes, depreciation and
    amortization, adjusted to exclude the effects of unusual, non-recurring or
    non-cash items. EBITDA has been adjusted to exclude the effects of the
    following items for the periods referenced: (i) development project
    write-downs, of approximately $2.7 million, $0.1 million, $2.2 million and
    $1.3 million, for fiscal years ended November 30, 1997, 1998, 1999 and 2000,
    respectively; (ii) consent fees and costs related

                                       23
<PAGE>
    to the Colony/Harveys merger, of approximately $1.2 million and
    $19.9 million, for fiscal years ended November 30, 1998 and 1999,
    respectively; (iii) amortization expense, of approximately $1.2 million and
    $1.8 million, related to restricted stock grants for fiscal years ended
    November 30, 1999 and 2000, respectively; (iv) pre-opening expenses, of
    approximately $4.1 million, for fiscal year ended November 30, 1996;
    (v) gain, of approximately $27.4 million, on the sale of interests in an
    unconsolidated affiliate for fiscal year ended November 30, 1997;
    (vi) cumulative effect of an accounting change, of approximately
    $3.1 million, for fiscal year ended November 30, 2000; (vii) loss on the
    early retirement of debt, net of tax, of approximately $0.5 million and
    $0.9 million, for fiscal years ended November 30, 1996 and 1999,
    respectively; (viii) costs related to the terminated merger, of
    approximately $9.9 million, for fiscal year ended November 30, 2000; and
    (ix) other non-operating expenses, of approximately $0.2 million,
    $0.1 million, $0.1 million, $0.5 million and $0.5 million, for fiscal years
    ended November 30, 1996, 1997, 1998, 1999 and 2000, respectively. EBITDA has
    not been adjusted to exclude charges of approximately $0.8 million of
    business development costs recognized in fiscal year 2000 relative to
    abandoned projects. Prior to the December 1, 1999 adoption of Statement of
    Position 98-5, Reporting on the Costs of Start-Up Activities, such costs
    were capitalized as incurred and expensed upon the commencement of
    operations of the new project or upon the abandonment of the project. (See
    Note 8. CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE included in
    our Consolidated Financial Statements found elsewhere in this report).

   EBITDA is not a measure of financial performance under generally accepted
    accounting principles ("GAAP"), but is used by some investors to determine a
    company's ability to service or incur indebtedness. EBITDA is not calculated
    in the same manner by all entities and accordingly is not necessarily
    comparable to similarly entitled measures of other entities and may not be
    an appropriate measure for performance relative to other entities. EBITDA
    should not be construed as an indicator of the Company's operating
    performance or liquidity, and should not be considered in isolation from or
    as a substitute for net income (loss), cash flows from operations or cash
    flow data prepared in accordance with GAAP. We have presented EBITDA solely
    as supplemental disclosure because we believe it allows for a more complete
    analysis of results of operations. EBITDA is not intended to represent and
    should not be considered more meaningful than, or as an alternative to,
    measures of operating performance as determined in accordance with GAAP.

(3) Of amounts shown, approximately $7.2 million in fiscal 1996, approximately
    $11.6 million in fiscal 1997, approximately $8.1 million in fiscal 1998,
    approximately $15.3 million in fiscal 1999, and approximately $14.1 million
    in fiscal 2000 related to recurring capital expenditures for maintenance of
    the current facilities.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE COMPANY'S FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

    We currently own and operate Harveys Resort, Harveys Wagon Wheel, Harveys
Casino Hotel and Bluffs Run Casino. The following table presents certain
operating results for our properties. For comparative purposes, results for
fiscal year ended November 30, 1999 have been presented on a combined basis by
aggregating the results for the period December 1, 1998 through February 1, 1999
with the results for the period February 2, 1999 (the date of the Colony/Harveys
merger) through November 30, 1999. Our results for the periods after the
Colony/Harveys merger are presented on a different basis of accounting from
those for periods before the Colony/Harveys merger, due to the application of
purchase method accounting. However, we believe that comparisons of the
financial results for the fiscal years can still provide a meaningful discussion
of our financial performance. The acquisition of Bluffs Run Casino was accounted
for as a purchase and, consequently, the results of operations prior to the
October 6, 1999 acquisition date were not consolidated with those of Harveys.
The fiscal year ended November 30, 1999 includes the results of 56 days of
operation of Bluffs Run Casino. The fiscal year ended November 30, 2000 includes
the full operations of Bluffs Run Casino for that period, thus creating
significant variances when comparing financial results for the year ended
November 30, 2000 with those for the year ended November 30, 1999.

                                       24
<PAGE>
RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                1998       1999       2000
                                                              --------   --------   --------
<S>                                                           <C>        <C>        <C>
Net Revenues
  Harveys Resort............................................  $133,454   $140,546   $148,292
  Harveys Casino Hotel......................................   113,541    124,128    127,767
  Bluffs Run Casino.........................................        --     18,802    132,702
  Harveys Wagon Wheel.......................................    62,514     56,827     53,327
                                                              --------   --------   --------
    Total Net Revenues......................................  $309,509   $340,303   $462,088
                                                              ========   ========   ========
Operating Income (Loss)
  Harveys Resort............................................  $ 23,768   $ 26,542   $ 31,469
  Harveys Casino Hotel......................................    21,824     25,663     24,857
  Bluffs Run Casino.........................................        --      3,852     26,938
  Harveys Wagon Wheel.......................................    14,107     10,116      4,657
  Corporate and Development.................................   (12,548)   (12,146)   (13,043)
                                                              --------   --------   --------
                                                                47,151     54,027     74,878
  Development project write-downs, consent fees,
    Colony/Harveys merger costs and costs related to
    terminated merger.......................................    (1,314)   (22,061)   (11,218)
                                                              --------   --------   --------
    Total Operating Income..................................  $ 45,837   $ 31,966   $ 63,660
                                                              ========   ========   ========
EBITDA
  Harveys Resort............................................  $ 33,160   $ 36,433   $ 42,726
  Harveys Casino Hotel......................................    29,065     33,869     34,102
  Bluffs Run Casino.........................................        --      5,619     38,065
  Harveys Wagon Wheel.......................................    17,731     14,113      8,811
  Corporate and Development.................................   (12,009)    (8,675)    (8,869)
                                                              --------   --------   --------
    Total EBITDA............................................  $ 67,947   $ 81,359   $114,835
                                                              ========   ========   ========
</TABLE>

FISCAL YEAR ENDED NOVEMBER 30, 2000 COMPARED TO FISCAL YEAR ENDED NOVEMBER 30,
  1999

    Fiscal year 2000 results were negatively effected by non-recurring expenses
related to a terminated merger, by certain development project write-downs and
by the cumulative effect of a change in accounting principle related to start-up
costs. Fiscal year 1999 results include non-recurring consent fees and costs
associated with the Colony/Harveys merger and development project write-downs.

    Our consolidated net revenues for fiscal year 2000 were $462.1 million, a
$121.8 million, or 35.8%, improvement over the prior year. Bluffs Run Casino
provided $132.7 million of the net revenue for fiscal 2000, an increase of
$113.9 million compared to the $18.8 million provided by Bluffs Run Casino
during the last 56 days of fiscal 1999. Growth in net revenues from our Lake
Tahoe property and from our Council Bluffs operations more than offset declines
from our Central City property. Excluding the development project write-downs
from results for both fiscal years, the terminated merger costs from fiscal 2000
and the Colony/Harveys merger costs and the consent fees from fiscal 1999, our
operating income improved by $20.9 million, or 38.6%, over fiscal 1999 and
amounted to $74.9 million. The improvement was largely attributable to Bluffs
Run Casino, which provided an increase of $23.1 million in operating income.

    LAKE TAHOE, NEVADA.  Our net revenues from Lake Tahoe for the year ended
November 30, 2000 amounted to $148.3 million, an increase of $7.7 million, or
5.5%, over our net revenues for fiscal 1999. All operating areas experienced
revenue improvements, due to an increase in casino volume and an improved table
game hold percentage, improved revenue per available room and increased food
covers and average check. The higher volume of casino activity was the result of
increased customer head

                                       25
<PAGE>
counts. Our Lake Tahoe operating profit of $31.5 million for fiscal 2000
improved by $4.9 million, or 18.6%, as a result of our improved casino revenues
and profits.

    COUNCIL BLUFFS, IOWA.  Our net revenues from Council Bluffs for the year
ended November 30, 2000 amounted to $127.8 million, an increase of
$3.6 million, or 2.9%, over our net revenues for fiscal 1999. Revenue
improvements were the result of increased wagering volume and food covers. Our
Council Bluffs operating profit of $24.9 million decreased by $0.8 million, or
3.1 percent. Depreciation expense increased year-over-year by approximately
$1.0 million, primarily the result of opening a new parking facility in
October 1999.

    BLUFFS RUN CASINO.  Our purchase of the net assets of Bluffs Run Casino on
October 6, 1999 and the subsequent management of the operations of that
property, provided net revenues for the 56 days ended November 30, 1999 of
$18.8 million and operating profit of $3.9 million. Net revenues from this
property for the year ended November 30, 2000 amounted to $132.7 million and
operating profit amounted to $26.9 million.

    Casinos at pari-mutuel tracks in Iowa, including Bluffs Run Casino, are
subject to an escalating wagering tax which, as of January 1, 2001 was
30 percent. The tax, which applies to gross receipts from slot machines,
increases by two percent per year and was 24%, 26% and 28% during calendar year
1998, 1999 and 2000, respectively. The tax is projected to continue to increase
two percent per year until it reaches a maximum of 36% on January 1, 2004.

    In November 2000, the City of Council Bluffs announced plans to develop a
projected $150 million recreation and entertainment complex on approximately 96
acres of land adjacent to Bluffs Run Casino (the Mid America Recreation and
Convention Complex). As presently planned, the complex would include a 7,500
seat multi-use arena, a 33,500 square foot exhibit hall, a 44,000 square foot
meeting and ballroom facility, two hotels, a 20 acre indoor/outdoor aquatic park
and additional retail, restaurant and entertainment venues. While we can give no
assurances that funding for the project will be available or that the project
will be constructed, we believe that, if constructed, the project would have a
positive effect on the operations of Bluffs Run Casino. However, we may be
obligated to contribute approximately $6.9 million of cash and make other
non-cash contributions to the project if the Mid America Recreation and
Convention Complex application to Vision Iowa is granted. (See--Liquidity and
Capital Resources, below). Under current expectations, the earliest that the
complex could open would be in late 2002.

    CENTRAL CITY, COLORADO.  Our net revenues from Central City for the year
ended November 30, 2000 amounted to $53.3 million, a decrease of $3.5 million,
or 6.2%, from our net revenues for fiscal 1999. Approximately $3.4 million of
the revenue decline was in our casino revenues and is principally the result of
new competition in Black Hawk. Our Central City operating profit of
$4.7 million declined $5.5 million, or 54.0%, principally as a result of the
decline in our casino revenues and profits and an increase in marketing and
advertising expenditures in response to the new competition.

    The Central City Business Improvement District is seeking to construct a
southern access road connecting Central City to I-70. If completed as proposed,
the highway will terminate near Central City and will provide improved four-lane
access between the Central City/Black Hawk market and Denver. All necessary
regulatory approvals have been obtained and the Central City Business
Improvement District is finalizing financing for the project. The terms of the
financing, including how they may affect us, have not yet been determined and
will be negotiated by the Company, the Central City Business Development
District and others who may participate in the financing. We can give no
assurances as to when or whether the project will be completed, but believe
that, if completed, the improved access would mitigate the impact of the
increased competition from Black Hawk on the operations of Harveys Wagon Wheel.

                                       26
<PAGE>
    CORPORATE AND DEVELOPMENT--Our corporate expense for fiscal 2000 amounted to
approximately $10.7 million, excluding depreciation and amortization, compared
to approximately $9.8 million for the fiscal 1999 period. Approximately
$0.7 million of the increase resulted from non-cash charges related to
stock-based compensation awards. Additionally, fiscal year 2000 includes
approximately $0.8 million of expenses related to our review and consideration
of potential business development opportunities. In fiscal 1999 and prior years,
the Company capitalized costs associated with potential new gaming projects
until (i) the project was no longer considered viable and the costs were
expensed, or (ii) the likelihood of the project was relatively certain and the
costs were reclassified to pre-opening costs and expensed when operations
commenced.

    OTHER FACTORS AFFECTING RESULTS OF OPERATIONS--During fiscal year 2000, a
newly formed subsidiary of Harveys Casino Resorts entered into a definitive
agreement with Pinnacle Entertainment, Inc. (formerly Hollywood Park, Inc.)
pursuant to which the newly formed subsidiary would acquire by merger all the
outstanding capital stock of Pinnacle Entertainment (the "Harveys/Pinnacle
merger"). Consummation of the Harveys/Pinnacle merger was subject to, among
other things, regulatory approvals in the various jurisdictions in which Harveys
and Pinnacle conduct gaming operations, completion of financing for the
transaction and satisfaction of other conditions precedent. The Harveys/Pinnacle
merger was not consumated in fiscal year 2000 and, in January 2001, the Company
announced that the proposed Harveys/Pinnacle merger transaction had been
terminated by mutual agreement of the parties. Consequently, the Company
recognized charges of approximately $9.9 million in fiscal year 2000 related to
the terminated Harveys/Pinnacle merger. Results for fiscal 1999 include the
effects of costs related to the Colony/Harveys merger and consent fees paid to
the Company's note holders. Such costs and fees aggregated to approximately
$19.9 million.

    In the second quarter of fiscal 2000, we reviewed our business development
plans as they related to a proposed resort in Salisbury Beach, Massachusetts. As
a result of that review, we abandoned the project and wrote-off approximately
$1.3 million of real estate options and architectural designs. In the second
quarter of fiscal 1999, we decided not to pursue our business development plans
in Las Vegas, Nevada and wrote-off approximately $2.0 million of costs we had
previously deferred. That write-off and other minor business development charges
amounted to approximately $2.2 million for fiscal 1999.

    Depreciation and amortization expense for fiscal 2000 increased
approximately $11.9 million to $38.1 million. Approximately $7.8 million of this
increase was attributable to the amortization of the cost in excess of net
assets acquired as a result of the Colony/Harveys merger and the acquisition of
the net assets of Bluffs Run Casino. The balance of the increase for fiscal 2000
was primarily the result of the change in the accounting basis for property and
equipment brought on by the merger and the acquisition.

    As a result of the Colony/Harveys merger financing and the 100% financing of
the Bluffs Run Casino acquisition, our average long-term debt during fiscal 2000
was substantially higher than during fiscal 1999. Consequently, our interest
expense, net of interest income, increased by approximately $10.9 million to
$37.7 million.

    Effective December 1, 1999, we adopted Statement of Position 98-5, Reporting
on the Costs of Start-Up Activities. The provisions of this accounting
pronouncement require costs of start-up activities (commonly referred to as
pre-opening costs in the gaming industry) to be expensed as incurred. The
initial effect upon adoption is reported as the cumulative effect of a change in
accounting principle. As required, we wrote-off all capitalized pre-opening
costs as of December 1, 1999. These costs included previously deferred
organization and licensing costs. The write-off resulted in a charge of
approximately $3.1 million, net of an income tax benefit of approximately
$1.4 million.

    Some portion of the Colony/Harveys merger-related expenses are not tax
deductible. This reduced the effective tax rate applied to our loss for the
period prior to the merger (December 1, 1998 through February 1, 1999) to
approximately 24 percent. The reduced tax rate applied to our loss had the
effect

                                       27
<PAGE>
of reducing the tax benefit we expect from the pre-merger period loss by
approximately $2.4 million, resulting in an effective tax rate for fiscal 1999
of 90.7% compared to a more normal effective rate of 41.7% for fiscal 2000.

FISCAL YEAR ENDED NOVEMBER 30, 1999 COMPARED TO FISCAL YEAR ENDED NOVEMBER 30,
  1998

    Meaningful comparisons of our overall financial results for fiscal 1999 and
1998 can be difficult because of the recognition of business development
write-offs, the consent fee and costs related to the Colony/Harveys merger and
the extraordinary loss on the early retirement of debt. The following summary
discussion of our consolidated financial results excludes the effects of those
charges from all periods. Our fiscal 1999 results were also affected by our
October 6, 1999 acquisition of the net assets of Bluffs Run Casino and our
subsequent management of that facility.

    Our consolidated net revenues for fiscal year 1999 were $340.3 million, a
$30.8 million, or 9.9% improvement over the prior year. Bluffs Run Casino
provided $18.8 million of the net revenue growth. On a same-store comparison,
net revenues improved by $12.0 million, or 3.9%, over net revenues for fiscal
1998. Substantial growth in net revenues from our Lake Tahoe property in the
first quarter of fiscal 1999, along with moderate growth for the balance of the
year and the continuing strong revenues from our Council Bluffs operations more
than offset declines from our Central City property. Our operating income,
excluding our business development write-offs, the consent fee and costs related
to the Colony/Harveys merger, was $54.0 million for fiscal 1999. Excluding the
contribution from Bluffs Run Casino, operating income amounted to
$50.2 million. This was an improvement of $3.0 million, or 6.4%, over the prior
year.

    LAKE TAHOE, NEVADA.  Our net revenues from Lake Tahoe for the year ended
November 30, 1999 amounted to $140.5 million, an increase of $7.1 million, or
5.3%, over our net revenues recorded for fiscal 1998. All operating areas
experienced revenue improvements, primarily as a result of strong first quarter
wagering volume and hotel occupancy. Our Lake Tahoe operating profit of
$26.5 million for fiscal 1999 improved by $2.8 million, or 11.7%, as a result of
our improved first and fourth quarters.

    COUNCIL BLUFFS, IOWA.  Our net revenues from Council Bluffs for the year
ended November 30, 1999 amounted to $124.1 million, an increase of
$10.6 million, or 9.3%, over our net revenues recorded in fiscal 1998. Revenue
improvements were the result of increased wagering volume, hotel occupancy and
food covers. Our Council Bluffs operating profit of $25.7 million improved by
$3.8 million, or 17.5%, driven primarily by casino revenues and profits.

    We constructed a new parking facility at our Council Bluffs property that
offers 1,630 parking spaces and features climate-controlled access to the
adjacent casino. We opened the new parking facility ahead of schedule in early
October 1999.

    BLUFFS RUN CASINO.  Our purchase of the net assets of Bluffs Run Casino on
October 6, 1999 and the subsequent management of the operations of that
property, provided net revenues for the 56 days ended November 30, 1999 of
$18.8 million and operating profit of $3.9 million.

    CENTRAL CITY, COLORADO.  Our net revenues from Central City for the year
ended November 30, 1999 amounted to $56.8 million, a decrease of $5.7 million,
or 9.1%, from our net revenues recorded in fiscal 1998. Approximately
$5.8 million of revenue decline was in our casino revenues and was principally
the result of the opening of new competition in Black Hawk in mid to late 1998.
Our Central City operating profit of $10.1 million declined $4.0 million, or
28.3%, principally as a result of the decline in our casino revenues and profits
and an increase in marketing and advertising expenditures in response to the new
competition.

    OTHER FACTORS AFFECTING RESULTS OF OPERATIONS--Our results for the year
ended November 30, 1999 were affected by several other factors, including: the
write-off of certain business development costs,

                                       28
<PAGE>
increases in depreciation and amortization, decreases in corporate expenses,
increases in interest expense, consent fees, costs related to the Colony/Harveys
merger, an extraordinary loss on the early retirement of debt, and changes in
our effective tax rate.

    In the second quarter of fiscal 1999, we decided not to pursue our current
business development plans in Las Vegas, Nevada and wrote off approximately
$2.0 million of costs we had previously deferred. This write-off and other minor
business development charges amounted to approximately $2.2 million for fiscal
1999.

    Depreciation and amortization expense for fiscal 1999 increased
approximately $5.4 million to $26.2 million. Approximately $3.0 million of this
increase was attributable to the write-off of the cost in excess of net assets
acquired as a result of the Colony/Harveys merger and the October 1999
acquisition of the net assets of Bluffs Run Casino. The balance of the increase
for fiscal 1999 was primarily the result of the change in the accounting basis
for property and equipment brought on by the Colony/Harveys merger and the
acquisition of the net assets of Bluffs Run Casino.

    Our corporate expense for fiscal 1999 amounted to approximately
$9.8 million, excluding depreciation and amortization, compared to approximately
$12.0 million for the fiscal 1998 period. The savings were principally the
result of the elimination of our long-term incentive plan, the elimination of
compensation paid to non-employee members of our board of directors and the
reduction in the amount of expense we recognize in relation to our pension and
postretirement benefit plans. These eliminations and reductions were a result of
the Colony/Harveys merger.

    As a result of the Colony/Harveys merger financing and the financing of the
Bluffs Run Casino acquisition, our debt and fixed charge obligations increased.
In February 1999, we assumed $172 million that an affiliate of Colony Capital
had borrowed to partially finance the Colony/Harveys merger. Subsequently, we
used our available short-term cash equivalent investments to repay a portion of
the borrowings. In October 1999, we financed 100% of the Bluffs Run Casino
acquisition and related closing and transaction costs. Consequently we
experienced a decrease in our interest income and an increase in our interest
expense. For fiscal 1999, our net interest expense was approximately
$26.8 million versus approximately $15.6 million for the prior year.

    Our results for fiscal 1999 were also diminished by the effects of consent
fees and costs related to the Colony/Harveys merger of approximately
$19.9 million incurred at the time of the merger.

    In connection with the Colony/Harveys merger, our existing credit agreement
was retired. Upon retirement, we expensed all unamortized loan fees and other
financing costs related to the prior credit agreement. That expense of
approximately $869,000, net of tax of $275,000, was included as an extraordinary
item in our results for fiscal 1999.

    Some portion of the Colony/Harveys merger-related expenses are not tax
deductible. This reduced the effective tax rate applied to our loss for the
period prior to the merger (December 1, 1998 through February 1, 1999) to
approximately 24%. The reduced tax rate applied to our loss had the effect of
reducing the tax benefit from the pre-merger period loss by approximately
$2.4 million.

LIQUIDITY AND CAPITAL RESOURCES

    Our primary source of cash during fiscal 2000 was approximately
$52.7 million of cash flow from operations, compared to approximately
$42.1 million of aggregate cash flow from operations in the prior year. We
expended approximately $18.6 million on capital improvements and replacements,
paid approximately $2.2 million of construction payables on our parking
structure at Harveys Casino Hotel in Council Bluffs and reduced our outstanding
indebtedness under our credit facility by approximately $35.5 million.

                                       29
<PAGE>
    Our cash and cash equivalents decreased by $3.9 million, from $32.5 million
at November 30, 1999 to $28.6 million at November 30, 2000. Additionally, our
outstanding debt decreased from $393.9 million at the end of fiscal 1999 to
$358.4 million at November 30, 2000, excluding the unamortized premium on our
senior subordinated notes. Our debt at November 30, 2000 consisted of
$150 million of senior subordinated notes and $208.4 million outstanding under
our credit facility.

    In addition to our debt, we were obligated at November 30, 2000 for an
aggregate of approximately $70.2 million on our outstanding 13 1/2% Senior
Redeemable Convertible Cumulative Series A and Series B Preferred Stock and the
unpaid dividends accrued thereon. On February 1, 2001, the holders of our
Series A Preferred Stock and the holders of our Series B Preferred Stock elected
to convert all of the outstanding preferred stock to corresponding shares of
Class A (voting) Common Stock and Class B (nonvoting) Common Stock of the
Company. In connection with the conversion, the Company elected to satisfy the
accrued and unpaid dividends on the preferred stock by issuing additional shares
of corresponding Class A Common Stock and Class B Common Stock.

    At November 30, 2000, we also had approximately $48.5 million of standby
letters of credit outstanding, including a $45.0 million irrevocable letter of
credit to support contingent consideration of up to $50.0 million which may be
due as part of the consideration paid for the net assets of Bluffs Run Casino.
The contingent payment depends on the results of a referendum to be decided by
the voters of Pottawattamie County, Iowa in November 2002.

    Our credit facility matures and is fully due and payable on September 30,
2004. The permitted principal balance of the credit facility reduces on a
quarterly basis, beginning August 31, 2000. Given our outstanding balance at
November 30, 2000 and our anticipated sources and uses of cash, we do not expect
to be subject to any mandatory principal payment requirements during the next
twelve months. Interest on borrowings outstanding under the credit facility are
payable, at our option, at either the London Inter-Bank Offering Rate ("LIBOR")
or an alternative base rate, in each case plus an applicable margin. In the
future, the applicable margins may be changed, based on the ratio of our total
funded debt to EBITDA. The credit facility contains a number of covenants that,
among other things, subject to applicable gaming approvals, restrict our ability
to dispose of assets, incur additional indebtedness, prepay any principal amount
of our $150 million senior subordinated notes, pay dividends, create liens on
assets, make investments, loans or advances, engage in mergers or
consolidations, change the nature of our business or engage in certain
transactions with affiliates and otherwise restrict certain corporate
activities. In addition, under the credit facility, we are required to maintain
specified financial ratios and net worth requirements, satisfy specified
financial tests, including interest coverage tests, and maintain certain levels
of annual capital expenditures. The credit facility contains events of default
customary for facilities of this nature.

    Our senior subordinated notes are governed by an indenture and are general
unsecured obligations of the Company, subordinated in right of payment to all
existing and future senior debt of the Company. Interest on the senior
subordinated notes is payable semi-annually on June 1 and December 1 of each
year. The senior subordinated notes mature on June 1, 2006. The senior
subordinated notes are redeemable at our option, in whole or in part, at any
time on or after June 1, 2001 at prices ranging from 105.313% of the principal
amount plus accrued and unpaid interest, to 100% of the principal amount plus
accrued and unpaid interest beginning June 1, 2004 and thereafter. The indenture
contains certain covenants that impose limitations on, among other things,
incurrence of additional indebtedness, the payment of dividends, the repurchase
of capital stock and the making of certain other restricted payments and
restricted investments (as defined in the indenture), mergers, consolidations
and sales of assets by the Company, the creation or incurrence of liens on the
assets of the Company, and transactions by the Company or any of its
subsidiaries with affiliates (as defined in the indenture). These limitations
are subject to a number of qualifications and exceptions as described in the
indenture.

                                       30
<PAGE>
    As of November 30, 2000, we were in compliance with the covenants under the
credit facility and the indenture.

    At the end of fiscal 2000, we had approximately $71.4 million available to
us under the bank credit facility, net of outstanding letters of credit and
subject to compliance with certain financial covenants. We also had cash and
cash equivalents of approximately $28.6 million.

    We anticipate expending approximately $16.6 million for capital expenditures
and property improvements in fiscal 2001. It is anticipated that a significant
portion of the proposed Mid America Recreation and Convention Complex
development would be funded through a new state program called "Vision Iowa", a
fund set aside for large-scale tourism oriented projects in Iowa cities. Vision
Iowa funding is required to be matched with private and public contributions. If
the Mid America Recreation and Convention Complex application to Vision Iowa for
funding is granted, we are committed to contribute $6.9 million in cash
contributions and loans pursuant to a memorandum of understanding among Harveys,
the City of Council Bluffs and certain Iowa nonprofit foundations. Our funding
in that event would most likely occur in fiscal 2001. We paid cash for
approximately $2.0 million of the $9.9 million of costs incurred in connection
with the terminated Harveys/Pinnacle merger in fiscal 2000. We expect to pay the
balance, approximately $7.9 million, and to pay any such costs incurred in
fiscal 2001, in the first quarter of fiscal 2001. We believe that our existing
cash and cash equivalents, cash flows for operations and our borrowing capacity
under the credit facility will be sufficient to meet the cash requirements of
our existing operations for at least the next twelve months, debt service
requirements and those expenditures described above. We currently believe that
cash requirements of our existing operations beyond the next twelve months will
consist of debt service requirements and capital improvements and replacements
in the ordinary course, which we expect to be met by then-existing cash, cash
flows from operations and borrowing capacity under the credit facility. Other
than the $50 million contingent payment which may become due after the vote on
the referendum in Pottawattamie County, Iowa in November 2002 and certain
obligations to a former shareholder and executive officer (see--Item 11.
EXECUTIVE COMPENSATION--Employment Contracts and Change of Control
Arrangements), we do not currently anticipate incurring material capital
expenditures, balloon or other extraordinary payments on long-term obligations
or any other extraordinary demands or commitments beyond the next twelve months.
We do not expect to pay cash dividends on our common stock because of, among
other reasons, restrictions in the credit facility and the indenture on the
payment of cash dividends.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    We are exposed to market risk from changes in interest rates. Borrowings
outstanding under our credit facility are subject to variable interest rates.
The amount outstanding under our credit facility at November 30, 2000 was
approximately $208.4 million, subject to a weighted-average interest rate of
8.59%. Assuming an identical outstanding balance, a hypothetical immediate 100
basis point increase in interest rates would increase interest expense for the
next twelve months by approximately $2.1 million.

    We entered into an interest rate cap agreement, effective March 1, 2000, to
reduce the potential impact of increases in interest rates on variable-rate
debt. The notional amount of the interest rate cap agreement was $48 million on
March 1, 2000 and reduces quarterly over the 35 month term of the agreement. The
notional amount on November 30, 2000 was approximately $34.3 million. The
agreement entitles the Company to receive from counterparties, on a monthly
basis, the amount, if any, by which the Company's interest payments on its
floating LIBOR-based debt exceeds the amount that would have been paid if the
one-month LIBO rate was capped at 7.5 percent. The combination of the interest
rate cap agreement and the terms of the credit facility result in the Company
paying interest, on an amount of variable-rate debt equal to the notional amount
of the interest rate cap agreement, at a variable rate (LIBOR plus 2.00%), not
to exceed 9.50 percent. We may use additional derivative

                                       31
<PAGE>
financial instruments in the future as a risk management tool. We do not use
derivative financial instruments for speculative or trading purposes.

    At November 30, 2000, the fair value of the Company's fixed rate long-term
debt, consisting of our $150 million of senior subordinated notes and
approximately $5.6 million of unamortized premium on the senior subordinated
notes, and the fair value of the Company's fixed rate preferred stock, were
sensitive to differences between market interest rates and rates at the time of
issuance. A hypothetical immediate 100 basis point increase in interest rates at
November 30, 2000 would have decreased the fair value of our fixed rate
long-term debt by approximately $13.8 million. Conversely, a 100 basis point
decrease in interest rates would have increased the fair value of our
outstanding long-term debt at November 30, 2000 by approximately $16.8 million.
A hypothetical immediate 100 basis point increase in interest rates would have
decreased the fair value of our fixed rate preferred stock by approximately
$4.7 million at November 30, 2000. Conversely, a 100 basis point decrease in
interest rates would have increased the fair value of our preferred stock by
approximately $5.4 million.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    The consolidated financial statements are as set forth in the "INDEX TO
CONSOLIDATED FINANCIAL STATEMENTS" on page 46.

ITEM 9. CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
        DISCLOSURE

    On March 12, 1999, Deloitte & Touche LLP, who had previously been engaged as
the principal accountant to audit the consolidated financial statements of
Harveys Casino Resorts was dismissed as the Company's independent accountant.
The decision to change accountants was recommended by the Board of Directors of
the Company.

    Deloitte & Touche LLP's reports on the financial statements of the Company
for each of the past two fiscal years preceding the change in accountants 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.

    During the Company's most recent two fiscal years preceding the change in
accountants there were no disagreements with Deloitte & Touche 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 Deloitte & Touche LLP would have caused them to make reference
to the subject matter of the disagreement in connection with their report.

    During the Company's most recent two fiscal years preceding the change in
accountants there were no "reportable events" as listed in paragraph (a)(1)(v)
of Item 304 of Regulation S-K.

    On March 12, 1999, Ernst & Young LLP was selected as the principal
accountant to audit the Company's financial statements.

                                       32
<PAGE>
                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS

    The table below sets forth the director and executive officers of the
Company as of the date hereof:

<TABLE>
<CAPTION>
NAME                             AGE                              POSITION
----                           --------                           --------
<S>                            <C>        <C>
Thomas J. Barrack, Jr........     53      Chairman of the Board of Directors, President and Chief
                                            Executive Officer--Office of the Chief Executive
                                            Officer
Wade W. Hundley..............     35      Executive Vice President--Office of the Chief Executive
                                          Officer
John J. McLaughlin...........     45      Senior Vice President, Chief Financial Officer, Secretary
                                          and Treasurer--Office of the Chief Executive Officer
Gary D. Armentrout...........     53      Senior Vice President--Business Development and
                                          Government Relations
James J. Rafferty............     45      Senior Vice President--Corporate Marketing
John R. Bellotti.............     43      Senior Vice President of Human Resources
Edward B. Barraco............     56      Senior Vice President and General Manager--Harveys Wagon
                                            Wheel
William R. Stephens..........     52      Senior Vice President and General Manager--Harveys Resort
Verne H. Welch, Jr...........     63      Senior Vice President and General Manager--Harveys Casino
                                            Hotel
Daniel J. Roy, Jr............     41      Senior Vice President of Operations
</TABLE>

    THOMAS J. BARRACK, JR. serves as Chairman of the Board of Directors of the
Company. Mr. Barrack became a director at the effective time of the
Colony/Harveys merger, February 2, 1999, pursuant to an Agreement and Plan of
Merger dated as of February 1, 1998 and was appointed Chairman of the Board at
that time. On January 31, 2001, Mr. Barrack also became President and Chief
Executive Officer and, together with Messrs. Hundley and McLaughlin, composes
the Office of the Chief Executive Officer. Mr. Barrack is the manager and sole
member of Colony HCR Voteco. Mr. Barrack has served as Chairman and Chief
Executive Officer of each of Colony Capital LLC and Colony Advisors, Inc. since
August 1997. Colony Capital and Colony Advisors, Inc. are international real
estate investment and management firms. Mr. Barrack served as President of
Colony Capital and Colony Advisors, Inc. from August 1992 and September 1991,
respectively, until August 1997. Mr. Barrack is a Director of Continental
Airlines, Inc. (commercial airline); Public Storage, Inc. (developer, owner and
operator of self-storage facilities); Kennedy-Wilson, Inc. (worldwide real
estate marketing, brokerage and investment services company); and
MegaWorld, Inc. (company involved in the construction and fabrication of modular
structures, primarily for the energy, transportation and telecommunications
industries, and the domestic telecommunications services business).

    WADE W. HUNDLEY currently serves as Executive Vice President of the Company
and, as of January 31, 2001, together with Messrs. Barrack and McLaughlin,
composes the Office of the Chief Executive Officer. Prior to his appointment as
Executive Vice President on December 1, 2000, Mr. Hundley served as a principal
of Colony Capital, where he was responsible for the identification, evaluation
and consummation of new investments, concentrating on the firm's corporate
investments in real-estate dependent operating companies. For the past four
years, Mr. Hundley has been focused on Colony Capital's investments in the
gaming industry, where he played a lead role in structuring and negotiating the
Colony/Harveys merger. Previously, Mr. Hundley served as an asset manager with
Colony Advisors from May 1993 to January 1995, where he was responsible for the
management of the firm's land portfolio and non-performing loans.

    JOHN J. MCLAUGHLIN serves as Senior Vice President, Chief Financial Officer,
Secretary and Treasurer and, as of January 31, 2001, together with
Messrs. Barrack and Hundley, composes the Office of the Chief Executive Officer.
He was appointed Senior Vice President, Chief Financial Officer and Treasurer of
the Company in March 1996. Mr. McLaughlin became Secretary of the Company as of
the date of the Colony/Harveys merger, February 2, 1999. He joined the Company
in September 1995 as Chief Financial Officer. Mr. McLaughlin is a Certified
Public Accountant.

                                       33
<PAGE>
    GARY D. ARMENTROUT serves as Senior Vice President--Business Development and
Government Relations. He has served as Senior Vice President--Business
Development and Government Relations of the Company since May 1995. In this
position he has been responsible for identifying and pursuing the development of
new projects for the Company.

    JAMES J. RAFFERTY serves as Senior Vice President--Corporate Marketing. He
was appointed Corporate Vice President of Marketing of the Company in
December 1995 and was promoted to Senior Vice President of Corporate Marketing
in June 1997. Mr. Rafferty served as Vice President, Marketing--Lake Tahoe from
January 1992 to December 1995.

    JOHN R. BELLOTTI serves as Senior Vice President of Human Resources. He was
appointed Corporate Vice President of Human Resources of the Company in
August 1997 and was promoted to Senior Vice President of Human Resources in
December 1999. Prior to joining the Company in August 1997, Mr. Bellotti was
employed by Hyatt Hotels Corporation, serving most recently as Assistant Vice
President of Human Resources from 1993 to 1997.

    EDWARD B. BARRACO serves as Senior Vice President and General
Manager--Harveys Wagon Wheel. He has served as the Company's Senior Vice
President and General Manager--Harveys Wagon Wheel since July 1995. From
February 1992 to July 1995, Mr. Barraco served as Assistant General Manager--
Lake Tahoe.

    WILLIAM R. STEPHENS serves as Senior Vice President and General
Manager--Harveys Resort. He was appointed Senior Vice President and General
Manager--Harveys Resort in May 1999. Prior to assuming his current position,
Mr. Stephens was employed by the Hard Rock Hotel and Casino in Las Vegas in 1993
where he served as director of casino operations through the opening in 1995
until 1997 when he was promoted to the vice president of casino operations.

    VERNE H. WELCH, JR. serves as Senior Vice President and General
Manager--Harveys Casino Hotel. He has served as Senior Vice President and
General Manager--Harveys Casino Hotel since September 1995. Prior to moving to
the Council Bluffs property, Mr. Welch served as Senior Vice President and
General Manager--Lake Tahoe from November 1993 to September 1995.

    DANIEL J. ROY, JR. currently serves as Senior Vice President of Operations.
In this position, he is responsible for all operations at Harveys Casino Hotel
and Bluffs Run Casino. Mr. Roy was named Vice President of Casino Operations for
Harveys Casino Hotel in December 1997 and was promoted to Vice President of
Operations in September 1999 before assuming his current position in October
1999. Prior to December 1997, Mr. Roy was employed at the Hard Rock Hotel and
Casino in Las Vegas, Nevada. He was a member of the management team that opened
that property in March 1995.

    Mark Hedstrom, Chief Financial Officer of Colony Capital, serves as a
non-voting observer on the Board of Directors.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES AND EXCHANGE ACT

    Section 16(a) of the Securities Exchange Act of 1934 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
Securities and Exchange 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 our review of the copies of the forms we received, we
believe that all our executive officers, directors and greater than 10%
beneficial owners complied with all the filing requirements applicable to them
with respect to transactions during fiscal 2000 except as follows: Kelvin L.
Davis, a former director of the Company, was late filing one report on Form 4
relating to a change in beneficial ownership.

                                       34
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

    The following table sets forth the compensation earned by the Chief
Executive Officer of the Company and the other four most highly compensated
executive officers of the Company. The compensation set forth is for services
rendered to the Company in all capacities during the last three fiscal years
ended November 30, 2000 (the five individuals are referred to in this report as
the "Named Executive Officers").

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                     ANNUAL COMPENSATION                                 LONG-TERM AWARDS
                             -----------------------------------   -------------------------------------------------------------
                              YEAR ENDED                           RESTRICTED    SECURITIES
                             NOVEMBER 30,                             STOCK      UNDERLYING       LTIP            ALL OTHER
NAME AND PRINCIPAL POSITION      2000       SALARY($)   BONUS($)   AWARD($)(1)   OPTIONS(#)   PAYOUTS($)(2)   COMPENSATION($)(3)
---------------------------  ------------   ---------   --------   -----------   ----------   -------------   ------------------
<S>                          <C>            <C>         <C>        <C>           <C>          <C>             <C>
Charles W. Scharer(4) .          2000        560,385    373,327      642,050           --              --           26,271
  President and Chief            1999        520,000    520,000      522,033       36,360       1,210,795           20,313
  Executive Officer and          1998        467,500    448,800           --           --         118,034           17,400
  Director

John J. McLaughlin .....         2000        328,808    156,309      428,033           --              --            5,100
  Senior Vice President,         1999        294,077    222,358      348,022       24,240         392,744            4,800
  Chief Financial Officer,       1998        250,000    179,250           --           --              --            4,800
  Treasurer and Secretary

Gary D. Armentrout .....         2000        242,885     92,031       78,799        1,818              --            5,100
  Senior Vice                    1999        240,000    129,600      174,011        9,090         354,475            4,800
  President--Business            1998        236,359    128,510           --           --              --            4,800
  Development and
  Government Relations

William R. Stephens ....         2000        243,849    138,491      195,674        3,030              --            6,368
  Senior Vice President and      1999        112,308    109,200      174,011        9,090              --            1,385
  General Manager--Harveys       1998             --         --           --           --              --               --
  Resort

Verne H. Welch, Jr. ....         2000        259,615     60,698      261,892        4,040              --           35,804
  Senior Vice President and      1999        213,077    135,775      174,011        9,090         301,583           29,649
  General Manager--Harveys       1998        201,194    125,931           --           --          45,422           25,331
  Casino Hotel
</TABLE>

--------------------------

(1) The fiscal year 2000 awards were calculated at $33.109 per share, the
    estimated fair market value of a share of the Company's common stock on the
    date of grant, June 1, 2000. The fiscal year 1999 awards were calculated at
    $19.1431 per share, the estimated fair market value of a share of the
    Company's common stock on the date of grant, February 2, 1999. The
    November 30, 2000 fiscal year-end aggregate holdings and the dollar value
    (calculated at $43.42 per share, the estimated fair market value of a share
    of the Company's common stock at November 30, 2000) were, in the case of Mr.
    Scharer, 46,662 shares and $2,026,064; in the case of Mr. McLaughlin, 31,108
    shares and $1,350,709; in the case of Mr. Armentrout, 11,470 shares and
    $498,027; in the case of Mr. Stephens, 15,000 shares and $651,300; and, in
    the case of Mr. Welch, 17,000 shares and $738,140.

                                       35
<PAGE>
    The fiscal year 1999 awards vest as to 20% on each of the first five
    anniversaries of the date of grant, February 2, 1999 (May 7, 1999 for
    Mr. Stephens). The fiscal year 2000 awards vest as to 20% on each of the
    first five anniversaries of February 2, 1999. However, none of the fiscal
    year 2000 awards shall vest unless certain financial performance targets for
    Bluffs Run Casino are met for fiscal years ending November 30, 2001 and 2002
    (the target for fiscal year 2000 was achieved). Further, all of the fiscal
    2000 awards are subject to forfeiture if the required referendum on the
    continuation of gaming at pari-mutuel racetracks, to be decided by the
    voters of Pottawattamie County, Iowa in 2002, is not approved. In the event
    of a change in control of the Company, 100% of the restricted stock shall
    vest in full. Additionally, in the event of a Named Executive Officers
    termination, any of the fiscal year 2000 awards that might have otherwise
    vested would be subject to special forfeiture provisions affecting either
    1/3 or 2/3 of the vested shares, depending on the timing and circumstances
    of the termination. Under certain conditions, as the fiscal year 1999 and
    2000 awards vest, the restricted shares may be canceled and an equivalent
    number of deemed shares created under a deferred compensation arrangement,
    under which the Company may be obligated to the Named Executive Officer for
    the fair market value of the deemed shares. With respect to the restricted
    stock awards granted to Mr. McLaughlin, in the event he is terminated
    without cause or terminates for good reason, his restricted stock awards
    will be accelerated.

    In the event that the Company distributed dividends to its stockholders, the
    Named Executive Officers would be entitled to receive dividends on all of
    their restricted shares or be credited with a dividend equivalent on any
    deemed shares under the deferred compensation agreement.

(2) In fiscal year 1994, the Company adopted a long-term incentive plan. At the
    effective time of the Colony/Harveys merger, the plan was terminated and the
    participants, including the Named Executive Officers, each received a lump
    sum payment at maximum value.

(3) Amounts include the Company's 401(k) Plan contributions, payments of term
    life insurance premiums and above-market rate interest earned on deferred
    compensation. In fiscal 2000, the Company's 401(k) Plan contributions were
    $5,100 for each of Mr. Scharer, Mr. McLaughlin, Mr. Armentrout and
    Mr. Welch, and $5,562 for Mr. Stephens. In fiscal 2000, the Company paid a
    premium of $1,300 on a term life insurance policy insuring the life of
    Mr. Scharer. In fiscal 2000, the above-market rate interest earned by
    Mr. Scharer, Mr. Stephens and Mr. Welch on deferred compensation amounted to
    $19,871, $806 and $30,704, respectively.

(4) Effective as of January 2, 2001, Mr. Scharer resigned as a member of the
    board of directors of the Company and, effective January 31, 2001,
    Mr. Scharer resigned from his positions as President and Chief Executive
    Officer of the Company and from all other positions and memberships with the
    Company or any of its subsidiaries. (See--Employment Contracts and Change of
    Control Arrangements, below).

                                       36
<PAGE>
OPTION GRANTS

    The tables below set forth certain information regarding options granted to
the Named Executive Officers during fiscal year 2000:

                       OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
                                                       INDIVIDUAL GRANTS                        POTENTIAL REALIZABLE
                                    --------------------------------------------------------      VALUE AT ASSUMED
                                    NUMBER OF    PERCENTAGE OF                                  ANNUAL RATES OF STOCK
                                      SHARES     TOTAL OPTIONS                                 PRICE APPRECIATION FOR
                                    UNDERLYING    GRANTED TO                                         OPTION TERM
                                     OPTIONS     EMPLOYEES IN    PRICE EXERCISE   EXPIRATION   -----------------------
NAME                                 GRANTED      FISCAL YEAR      ($/SHARE)         DATE       5%($)          10%($)
----                                ----------   -------------   --------------   ----------   --------       --------
<S>                                 <C>          <C>             <C>              <C>          <C>            <C>
Charles W. Scharer................       --            --                --       --                --             --
John J. McLaughlin................       --            --                --       --                --             --
Gary D. Armentrout................    1,818          4.15            33.109       5/26/2010     37,855         95,931
William R. Stephens...............    3,030          6.91            33.109       5/26/2010     63,091        159,885
Verne H. Welch, Jr................    4,040          9.22            33.109       5/26/2010     84,121        213,180
</TABLE>

    All options granted in fiscal year 2000 were granted with an exercise price
of no less than fair market value on the date of grant. The 2000 option grants
vest as to 20% of the underlying shares on each of the first five anniversaries
of February 2, 1999, regardless of whether the optionee is employed by the
Company as of any such date. The 2000 option grants are also subject to special
forfeiture provisions similar to the special forfeiture provisions applicable to
the awards of restricted stock. In the event of a change in control of the
Company prior to the optionee's termination of employment with the Company, the
2000 option grants shall immediately vest and become exercisable as to 100% of
the underlying shares. The term of the 2000 option grants are for ten years,
unless earlier terminated. With respect to the option granted to
Mr. McLaughlin, in the event he is terminated without cause or terminates for
good reason, his option will be accelerated.

OPTION EXERCISES AND HOLDINGS

    The table below sets forth information concerning the exercise of options
during the fiscal year ended November 30, 2000 and unexercised options held at
the end of the year by the Named Executive Officers.

               AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND
                          FISCAL YEAR-END OPTION VALUE

<TABLE>
<CAPTION>
                                                                  NUMBER OF SHARES
                                                                     UNDERLYING               VALUE OF UNEXERCISED
                                                                 UNEXERCISED OPTIONS         IN-THE-MONEY OPTIONS AT
                                SHARES                           AT FISCAL YEAR END         AT FISCAL YEAR END($)(1)
                              ACQUIRED ON     AGGREGATE      ---------------------------   ---------------------------
NAME                          EXERCISE(#)   VALUE REALIZED   EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
----                          -----------   --------------   -----------   -------------   -----------   -------------
<S>                           <C>           <C>              <C>           <C>             <C>           <C>
Charles W. Scharer(2).......          --             --         7,274         29,086        $169,921       $679,449
John J. McLaughlin..........          --             --         4,848         19,392        $113,249       $452,997
Gary D. Armentrout..........          --             --         2,182          8,726        $ 46,222       $184,866
William R. Stephens.........          --             --         2,424          9,696        $ 48,717       $194,868
Verne H. Welch, Jr..........          --             --         2,626         10,504        $ 50,800       $203,199
</TABLE>

------------------------

(1) Options are in-the-money if the fair market value of the underlying
    securities exceeds the exercise price of the options.

                                       37
<PAGE>
(2) On January 4, 2001, Mr. Scharer entered into a separation agreement with the
    Company pursuant to which 80% of his options were exchanged for future
    payments and 20% of his options were canceled without payment. See "ITEM 11.
    EXECUTIVE COMPENSATION--Employment Contracts and Change of Control
    Arrangements."

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

    The tables below set forth total benefits payable to executive employees,
including certain of the Named Executive Officers, who participate in the
Company's Supplemental Executive Retirement Plan. Amounts shown represent the
aggregate amounts to which participating employees are entitled under the
Supplemental Executive Retirement Plan.

                  SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN TABLE
                              (SEVEN YEAR VESTING)

<TABLE>
<CAPTION>
                                     ESTIMATED VESTED 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 VESTED 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>
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>

    Plan benefits are based on a percentage of average base compensation earned
during the participant's last five years of service without regard to years of
service. Base compensation is the participant's annual salary (but not bonuses
or incentive compensation), which is the same as

                                       38
<PAGE>
compensation depicted as salary in the Summary Compensation Table. Benefits are
generally computed as a straight-line annuity, and are not subject to any
deduction for social security benefits. Participants are entitled to receive
benefits upon attaining age 65 and having become vested. The seven year vesting
plan presently covers approximately 19 current or former executive employees.
The 20 year vesting plan, for those who began participation after October 1,
1994, covers approximately 8 executive employees. Participants in the seven year
vesting plan 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 plan 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. Participants do not become fully vested
simply upon attainment of age 65. Amounts shown for seven years or 20 years of
service in the respective tables above represent the maximum annual payments a
participant may receive. Benefits under the Supplemental Executive Retirement
Plan are payable for a period of 15 years.

    Prior to the Colony/Harveys merger, Mr. Scharer was fully vested under the
terms of the seven year vesting plan and Mr. McLaughlin had approximately three
years of credited service under the terms of the twenty year vesting plan. Upon
consummation of the Colony/Harveys merger, the rights of Mr. Scharer and
Mr. McLaughlin to participate in the Supplemental Executive Retirement Plan were
terminated, and they received lump sum payments in connection therewith.

    Mr. Welch is fully vested under the terms of the seven year plan,
Mr. Armentrout and Mr. Stephens have approximately five and one-half years and
one and one-half years, respectively, of credited service under the 20 year
vesting plan.

COMPENSATION OF DIRECTORS

    Currently, members of our board of directors do not receive any compensation
for their services as members of our board or any committee thereof.

    Directors who are also employees may be eligible to participate in the
Company's employee incentive plans.

EMPLOYMENT CONTRACTS AND CHANGE OF CONTROL ARRANGEMENTS

    On January 4, 2001, Mr. Scharer and the Company entered into a separation
agreement whereby Mr. Scharer resigned from his positions as President and Chief
Executive Officer of the Company and from all other positions and memberships
with the Company or any of its subsidiaries, all effective as of January 31,
2001.

    Under the terms of the severance agreement and the amended and restated
employment contract, Mr. Scharer received: (i) a lump sum payment, equal to
twice his base salary and annual target bonus, (ii) a special retention bonus
payment, (iii) a lump sum payment in satisfaction of amounts due as the result
of the termination of his participation in a supplemental executive retirement
plan at the time of the Colony/Harvey merger and subject to a deferred
compensation agreement, (iv) all accrued and unpaid base salary at the time of
his termination, and (v) payments under a non-qualified deferred compensation
plan.

    Additionally, Mr. Scharer is entitled to receive annual payments, beginning
in 2002, not to exceed $1.0 million, plus interest at the annual rate of 12%, in
exchange for 80% of the restricted stock awards and stock options granted to
Mr. Scharer pursuant to a 1999 award agreement (the remaining 20% to be canceled
without payment), and in exchange for 80% of the restricted incentive stock
awards granted to Mr. Scharer pursuant to a 2000 award agreement (the remaining
20% to be canceled without payment), provided that the performance criteria set
out in the 2000 award agreement are met

                                       39
<PAGE>
and the referendum on the continuation of gaming at pari-mutuel racetracks is
passed by the voters of Pottawattamie County, Iowa in 2002.

    Mr. Scharer is entitled to the continuation of his benefits, as defined in
the amended and restated employment contract, for the two year period following
his termination.

    John J. McLaughlin and the Company entered into an employment contract at
the effective time of the Colony/Harveys merger, February 2, 1999. On that date,
Mr. McLaughlin was also appointed Secretary of the Company. On April 28, 2000,
in contemplation of the potential Harveys/Pinnacle merger, Mr. McLaughlin and
the Company entered into an amended and restated employment contract. As
Mr. McLaughlin was named to the Office of the Chief Executive Officer, an
additional amendment to his employment contract will be undertaken in the near
future to reflect the revised terms of his employment. Mr. McLaughlin serves as
Senior Vice President, Chief Financial Officer and Treasurer under the new
employment contract with the Company. Mr. McLaughlin also continues to serve as
Secretary of the Company. The term of the new contract terminates on
February 2, 2004; provided that the term will be automatically extended for
one-year periods unless prior written notice not to extend the term is provided
at least six months prior to the expiration of the term. The new contract
provides that Mr. McLaughlin's maximum annual bonus will not be less than
$165,000. In February 2001, Mr. McLaughlin received a retention bonus of
$250,000 upon the abandoment of the Harveys/Pinnacle merger. The contract is
terminable at any time (upon 30 days' prior written notice) by Mr. McLaughlin or
the Company. If the contract is terminated by the Company other than for cause,
or by Mr. McLaughlin for good reason, Mr. McLaughlin is entitled to receive a
lump sum payment in an amount equal to the sum of his then base salary and his
annual target bonus increased by a multiplier as well as certain other benefits
(including acceleration of vesting with respect to Mr. McLaughlin's restricted
stock awards and stock options) for a period following termination. To the
extent applicable, Mr. McLaughlin will be entitled to a gross-up payment for
excise taxes under Section 4999 of the Code as well as for taxes imposed on the
gross-up payment. In fiscal year 2000, the Company also granted to
Mr. McLaughlin a restricted stock award consisting of 130 shares of Class A
Common Stock and 12,798 shares of Class B Common Stock, subject in all respects
to the Company's 1999 Omnibus Stock Incentive Plan, a Restricted Stock Agreement
between Mr. McLaughlin and the Company dated May 26, 2000 and a Stockholder
Agreement dated February 2, 1999 among the Company, Colony HCR Voteco, Colony
Investors III and certain other security holders of the Company.

    Wade Hundley serves as Executive Vice President under an employment
agreement with the Company effective as of December 1, 2000. The term of the
agreement runs through December 1, 2003; provided that the term will be
automatically extended for one-year periods unless prior written notice not to
extend the term is provided at least six months prior to the expiration of the
term. Mr. Hundley's annual salary established by the contract is $400,000,
subject to annual review. As an inducement to employment, Mr. Hundley is
entitled to (i) be paid a cash payment of $125,000 on January 2, 2001, (ii) a
grant of 73 shares of Class A Common Stock and 7,293 shares of Class B Common
Stock, free of all restrictions other than restrictions imposed by the
Stockholder Agreement dated February 2, 1999, among the Company, Colony HCR
Voteco, Colony Investors III and certain other security holders of the Company
and (iii) a special restricted stock award consisting of 60 shares of Class A
Common Stock and 5,967 shares of Class B Common Stock, which shall vest as to
55.56% of the shares on February 2, 2001 and as to the remaining 44.44% of the
shares on February 2, 2002. Mr. Hundley is also entitled to an interest bearing
loan from the Company to pay the taxes in connection with his stock grant and
special restricted stock award. The contract is terminable at any time (upon
30 days' prior written notice) by Mr. Hundley or the Company. If the contract is
terminated by the Company for reason other than cause or by Mr. Hundley for good
reason, Mr. Hundley is entitled to receive a lump sum payment in an amount equal
to the lesser of (i) the sum of 200% of (x) thedleyIIn's
his then base salary and (y) his deemed bonus of $100,000 on an annualized basis
and (ii) the sum of

                                       40
<PAGE>
(x) his base salary otherwise payable through the expiration of the employment
term and (y) the product of his deemed bonus multiplied by the number of months
remaining in his employment term, as well as partial acceleration of vesting
with respect to Mr. Hundley's option grant and the first restricted stock award
(see below) and certain other benefits for a period following termination (of at
least two years). Pursuant to the contract, the Company granted to Mr. Hundley
(i) two restricted stock awards, the first consisting of 210 shares of Class A
Common Stock and 21,000 shares of Class B Common Stock and the second consisting
of 151 shares of Class A Common Stock and 15,114 shares of Class B Common Stock
and (ii) an option to purchase 280 shares of Class A Common Stock and 28,000
shares of Class B Common Stock, each subject in all respects to the Company's
1999 Omnibus Stock Incentive Plan. The first restricted stock award and the
option vests as to 20% of the shares per year and the second restricted stock
award vests upon attainment of certain financial performance targets. In the
event of a change in control of the Company, Mr. Hundley's option grant shall
immediately vest and become fully excercisable. Both the restricted stock awards
and the option grant are subject to additional forfeiture provisions.

    Gary D. Armentrout serves as Senior Vice President, Business Development and
Government Relations under an employment agreement with the Company effective as
of June 30, 2000. The term of the agreement runs through June 30, 2001. The
agreement is terminable at any time (upon 30 days notice) by the Company. If the
agreement is terminated by the Company for reasons other than for cause,
Mr. Armentrout is entitled to receive the full value of his salary and other
benefits for the remainder of the agreement term. In fiscal year 2000, the
Company also granted to Mr. Armentrout a restricted stock award consisting of 24
shares of Class A Common Stock and 2,356 shares of Class B Common Stock and a
stock option to purchase 18 additional shares of Class A Common Stock and 1,800
additional shares of Class B Common Stock, each at a price of $33.109 per share,
subject in all respects to the Company's 1999 Omnibus Incentive Plan, a Stock
Option and Restricted Stock Agreement between Mr. Armentrout and the Company
dated May 26, 2000 and a Stockholders Agreement dated February 2, 1999 among the
Company, Colony HCR Voteco, Colony Investors III and certain other security
holders of the Company.

    William R. Stephens serves as Senior Vice President and General
Manager-Harveys Resort under an employment agreement with the Company effective
as of May 7, 1999 and extending through May 6, 2001. The agreement is terminable
at any time (upon 30 days notice) by Mr. Stephens or the Company. If the
agreement is terminated by the Company for reasons other than cause,
Mr. Stephens is entitled to receive the full value of his salary and other
benefits for the lesser of (i) the remainder of the agreement term or
(ii) twelve months. In fiscal year 2000, the Company also granted to
Mr. Stephens a restricted stock award consisting of 59 shares of Class A Common
Stock and 5,851 shares of Class B Common Stock and a stock option to purchase 30
additional shares of Class A Common Stock and 3,000 additional shares of
Class B Common Stock, each at a price of $33.109 per share, subject in all
respects to the Company's 1999 Omnibus Incentive Plan, a Stock Option and
Restricted Stock Agreement between Mr. Stephens and the Company dated May 26,
2000 and a Stockholders Agreement dated February 2, 1999 among the Company,
Colony HCR Voteco, Colony Investors III and certain other security holders of
the Company.

    Verne H. Welch, Jr. serves as Senior Vice President and General
Manager-Harveys Casino Hotel under an employment agreement with the Company
effective as of July 1, 1999. The term of the agreement runs through June 30,
2001. The agreement is terminable at any time (upon 30 days notice) by
Mr. Welch or the Company. If the agreement is terminated by the Company for
reasons other than cause, Mr. Welch is entitled to receive the full value of his
salary and other benefits for the lesser of (i) the remainder of the agreement
term or (ii) twelve months. In fiscal year 2000, the Company also granted to
Mr. Welch a restricted stock award consisting of 79 shares of Class A Common
Stock and 7,831 shares of Class B Common Stock and a stock option to purchase 40
additional shares of Class A Common Stock and 4,000 additional shares of
Class B Common Stock, each at a price of $33.109 per

                                       41
<PAGE>
share, subject in all respects to the Company's 1999 Omnibus Incentive Plan, a
Stock Option and Restricted Stock Agreement between Mr.Welch and the Company
dated May 26, 2000 and a Stockholders Agreement dated February 2, 1999 among the
Company, Colony HCR Voteco, Colony Investors III and certain other security
holders of the Company.

    The Company's Change of Control Plan provides for certain benefits in the
event (i) executive officers of the Company (other than those composing the
Office of the Chief Executive Officer) are terminated as a result of a change of
control, (ii) the position of certain members of senior management has been
restructured to involve demotion or other diminution of duties or
responsibilities as a result of a change of control, or (iii) the compensation
of certain members of senior management is materially reduced in anticipation
of, or within 2 years of, a change of control. If such termination occurs, the
Change of Control Plan provides for continuation of salary and benefits for a
period of twenty-four (24) to thirty-six (36) months and, if applicable, (i) a
lump sum payout at maximum of the sums payable for that year under the
Management Incentive Plan ("MIP") and (ii) additional vesting credit under the
Supplemental Executive Retirement Plan. Additionally, if following a change of
control the MIP is terminated or amended to adversely affect a participant of
the MIP, then such participant shall receive a lump sum payout at maximum for
the fiscal year during which the termination or amendment occurred. Unless
otherwise provided, the benefits payable under the Change of Control Plan shall
be offset or shall offset any severance benefits payable under an individual's
employment agreement with the Company.

    COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

    The Company's Board of Directors has no compensation committee, however,
during fiscal year 2000, John R. Bellotti, Senior Vice President of Human
Resources and Mark Hedstrom, Chief Financial Officer of Colony Capital and a
nonvoting observer on the Company's Board of Directors, reviewed executive
officer compensation and made recommendations concerning executive officer
compensation to Thomas J. Barrack, Jr., the Chairman of the Board.

                                       42
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    The following table sets forth as of February 20, 2001, beneficial ownership
of the Company's Class A Common Stock (the only class of voting securities of
the Company) and Class B Common Stock by (i) all persons who are beneficial
owners of more than five percent of the Class A or Class B Common Stock,
(ii) each director, (iii) the Named Executive Officers in each case who were
serving as an executive officer on behalf of the Company at the end of the last
fiscal year and (iv) all directors and executive officers, as a group. Except as
otherwise indicated, the Company believes that the beneficial owners of the
Class A Common Stock listed below, based on information furnished by such
owners, have sole investment and voting power with respect to such shares,
subject to community property laws where applicable. Unless otherwise indicated
the business address of such persons is U.S. Highway 50 and Stateline Avenue,
P.O. Box 128, Lake Tahoe, Nevada 89449. As of February 20, 2001, 68,876 shares
of Class A Common Stock and 7,268,427 shares of Class B Common Stock were
outstanding.

<TABLE>
<CAPTION>
                                                           CLASS A COMMON STOCK        CLASS B COMMON STOCK
                                                         -------------------------   -------------------------
                                                            SHARES                      SHARES
                                                         BENEFICIALLY   PERCENT OF   BENEFICIALLY   PERCENT OF
NAME OF BENEFICIAL OWNER                                    OWNED         CLASS         OWNED         CLASS
------------------------                                 ------------   ----------   ------------   ----------
<S>                                                      <C>            <C>          <C>            <C>
Colony HCR Voteco, LLC
  1999 Avenue of the Stars, Suite 1200
  Los Angeles, California 90067........................     67,284         96.9%             --          --
Colony Investors III, L. P.
  1999 Avenue of the Stars, Suite 1200
  Los Angeles, California 90067........................         --           --       7,109,859        97.0%
Thomas J. Barrack, Jr.(1)..............................     67,284         96.9%      7,109,859        97.0%
Charles W. Scharer.....................................         --           --              --          --
John J. McLaughlin(2)..................................          *            *               *           *
Gary D. Armentrout(2)..................................          *            *               *           *
William R. Stephens(2).................................          *            *               *           *
Verne H. Welch, Jr.(2).................................          *            *               *           *
All directors and executive officers as a group
  (10 persons)(1)(2)...................................     69,281         99.7%      7,308,615        99.8%
</TABLE>

--------------------------

*   Less than one percent.

(1) Mr. Barrack is the manager and sole member of Colony HCR Voteco, and thereby
    may be deemed to have beneficial ownership of the Class A Common Stock owned
    of record by Colony HCR Voteco. Mr. Barrack is also the controlling
    stockholder of the indirect general partner of Colony Investors III, and
    thereby may be deemed to have beneficial ownership of the Class B Common
    Stock owned of record by Colony Investors III. Mr. Barrack disclaims
    beneficial ownership of such shares of Class A Common Stock and Class B
    Common Stock.

(2) Beneficial ownership is determined in accordance with the rules of the
    Securities and Exchange Commission and includes grants of options that are
    exercisable currently or within 60 days. Such options to acquire Class A
    Common Stock related to 96 shares, 44 shares, 30 shares, 52 shares and 405
    shares in respect of Mr. McLaughlin, Mr. Armentrout, Mr. Stephens,
    Mr. Welch and all directors and executive officers as a group, respectively.
    Such options to acquire Class B Common Stock relate to 9,600 shares, 4,320
    shares, 3,000 shares, 5,200 shares and 40,188 shares in respect of
    Mr. McLaughlin, Mr. Armentrout, Mr. Stephens, Mr. Welch and all directors
    and executive officers as a group, respectively.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

    On January 4, 2001, Mr. Scharer and the Company entered into a separation
agreement whereby Mr. Scharer resigned from his positions as President and Chief
Executive Officer of the Company, as a member of the board of directors of the
Company and from all other positions and memberships with the Company or any of
its subsidiaries, all effective as of January 31, 2001. See "ITEM 11. EXECUTIVE
COMPENSATION--Employment Contracts and Change of Control Arrangements."

                                       43
<PAGE>
                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

    (a) The following documents are filed as part of this report:

    (1) Financial Statements.

    The consolidated financial statements of the Company are set forth in the
"INDEX TO CONSOLIDATED FINANCIAL STATEMENTS" on page 46.

    (2) Financial Statement Schedules.

    Schedules have been omitted because they are not applicable, are not
required or because the information is included elsewhere in the Consolidated
Financial Statements or the notes thereto.

    (3) Exhibits are set forth in the "EXHIBIT INDEX" on page 78.

    (b) Reports on Form 8-K filed during the last quarter of fiscal 2000.

    On November 15, 2000, we filed a Current Report on Form 8-K, under Item 5.
Other Events, to report that two recently formed subsidiaries of the Company
would commence cash tender offers and consent solicitations with respect to
Harveys' senior subordinated notes as well as all senior subordinated notes
issued by Pinnacle Entertainment, Inc. (formerly Hollywood Park, Inc.). The
tender offers and the consent solicitations related to the financing of the
proposed Harveys/Pinnacle merger.

    On November 17, 2000, we filed a Current Report on Form 8-K, under Item 5.
Other Events, to report the private offering, by a recently formed subsidiary of
the Company, of approximately $575 million of Senior Subordinated Notes, due
2010, and approximately $100 million of Senior Exchangeable PIK Preferred Stock,
due 2011, pursuant to Rule 144A and Regulation S under the Securities Act of
1933, as amended. The offerings were connected with the financing of the
proposed Harveys/Pinnacle merger.

CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
  SECURITIES LITIGATION REFORM ACT OF 1995

    This document includes various "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Sections
21E of the Securities Exchange Act of 1934, as amended, which represent the
Company's expectations or beliefs concerning future events. Statements
containing expressions such as "believes", "anticipates" or "expects" used in
the Company's press releases and periodic reports on Forms 10-K and 10-Q filed
with the Securities and Exchange Commission are intended to identify
forward-looking statements. All forward-looking statements involve risks and
uncertainties. Although the Company believes its expectations are based upon
reasonable assumptions within the bounds of its knowledge of its business and
operations, there can be no assurances that actual results will not materially
differ from expected results. The Company cautions that these and similar
statements included in this report and in previously filed periodic reports,
including reports filed on Forms 10-K and 10-Q, are further qualified by
important factors that could cause actual results to differ materially from
those in the forward-looking statements. Such factors include, without
limitation, the following: increased competition in existing markets or the
opening of new gaming jurisdictions; a decline in the public acceptance of
gaming; the limitation, conditioning or suspension of any of the Company's
gaming licenses; increases in or new taxes imposed on gaming revenues or gaming
devices; a finding of unsuitability by regulatory authorities with respect to
the Company's officers, directors or key employees; loss or retirement of key
executives; significant increases in fuel or transportation prices; adverse
economic conditions in the Company's key markets; severe and unusual weather in
the Company's key markets; adverse results of significant litigation matters.
Readers are cautioned not to place undue reliance on forward-looking statements,
which speak only as of the date thereof. The Company undertakes no obligation to
publicly release any revisions to such forward-looking statements to reflect
events or circumstances after the date hereof.

                                       44
<PAGE>
                                   SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized this 28th day of February,
2001.

<TABLE>
<S>                                                    <C>  <C>
                                                       HARVEYS CASINO RESORTS

                                                       By:          /s/ THOMAS J. BARRACK, JR.
                                                            -----------------------------------------
                                                                      Thomas J. Barrack, Jr.
                                                            CHAIRMAN OF THE BOARD, PRESIDENT AND CHIEF
                                                                        EXECUTIVE OFFICER
</TABLE>

    Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed by the following persons on behalf of the
registrant in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
                   NAME                                     TITLE                         DATE
                   ----                                     -----                         ----
<C>                                         <S>                                     <C>
        /s/ THOMAS J. BARRACK, JR.
    ---------------------------------       Chairman of the Board, President and    February 28, 2001
          Thomas J. Barrack, Jr.            Chief Executive Officer

           /s/ WADE W. HUNDLEY
    ---------------------------------       February 28, 2001
             Wade W. Hundley

          /s/ JOHN J. MCLAUGHLIN            Senior Vice President, Chief Financial
    ---------------------------------       Officer, Secretary and Treasurer        February 28, 2001
            John J. McLaughlin              (Principal Financial Officer)

            /s/ JOHN P. HEWITT
    ---------------------------------       Corporate Controller (Principal         February 28, 2001
              John P. Hewitt                Accounting Officer)
</TABLE>

                                       45
<PAGE>
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

<S>                                                           <C>
Report of Ernst & Young LLP, Independent Auditors...........     47

Report of Deloitte & Touche LLP, Independent Auditors.......     48

Consolidated Balance Sheets as of November 30, 1999 and
  2000......................................................     49

Consolidated Statements of Operations for the Year Ended
  November 30, 1998,
  the Year Ended November 30, 1999, of which the period from
  December 1, 1998
  through February 1, 1999 represents the predecessor
  company and the Year Ended
  November 30, 2000.........................................     50

Consolidated Statements of Stockholders' Equity for the Year
  Ended November 30, 1998,
  the Year Ended November 30, 1999, of which the period from
  December 1, 1998
  through February 1, 1999 represents the predecessor
  company and the Year Ended
  November 30, 2000.........................................     51

Consolidated Statements of Cash Flows for the Year Ended
  November 30, 1998,
  the Year Ended November 30, 1999, of which the period from
  December 1, 1998
  through February 1, 1999 represents the predecessor
  company and the Year Ended
  November 30, 2000.........................................     52

Notes to Consolidated Financial Statements..................     54
</TABLE>

                                       46
<PAGE>
                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of Harveys Casino Resorts:

    We have audited the accompanying consolidated balance sheets of Harveys
Casino Resorts (the "Company") as of November 30, 2000 and 1999, and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the two years in the period ended November 30, 2000, of which the period
from December 1, 1998 through February 1, 1999 represents the predecessor
company, as discussed in Note 1. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

    We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Harveys Casino
Resorts as of November 30, 2000 and 1999, and the consolidated results of its
operations and its cash flows for each of the two years in the period ended
November 30, 2000, of which the period from December 1, 1998 through
February 1, 1999 represents the predecessor company, in conformity with
accounting principles generally accepted in the United States.

    As discusssed in Note 8 to the consolidated financial statements, in fiscal
year 2000 the Company adopted Statement of Position 98-5, Reporting the Costs of
Start-up Activities.

                                               ERNST & YOUNG LLP

Reno, Nevada
December 28, 2000,
except for the final paragraph of Note 2,
 as to which the date is January 22, 2001,
 and Note 13, as to which
 the date is February 1, 2001

                                       47
<PAGE>
                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of Harveys Casino Resorts:

    We have audited the accompanying consolidated balance sheet of Harveys
Casino Resorts and subsidiaries (the "Company") as of November 30, 1998, and the
related consolidated statements of operations, stockholders' equity and cash
flows for the year then ended. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.

    We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

    In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Harveys Casino Resorts as of
November 30, 1998, and the results of its operations and its cash flow for the
year then ended in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
Reno, Nevada
January 5, 1999

                                       48
<PAGE>
                             HARVEYS CASINO RESORTS

                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                     NOVEMBER 30,
                                                              ---------------------------
                                                                  1999           2000
                                                              ------------   ------------
<S>                                                           <C>            <C>
                           ASSETS

Current assets
  Cash and cash equivalents.................................  $ 32,496,319   $ 28,645,582
  Accounts receivable, net of allowances for doubtful
    accounts of $595,477 in 2000 and $343,042 in 1999.......     5,810,264      6,346,170
  Inventories...............................................     3,703,915      3,579,395
  Prepaid expenses and other current assets.................     2,228,359      2,756,996
  Deferred income taxes.....................................     3,141,457      8,087,604
                                                              ------------   ------------
    Total current assets....................................    47,380,314     49,415,747
                                                              ------------   ------------
Property and equipment
  Land......................................................    53,876,000     54,414,937
  Buildings and improvements................................   295,755,884    296,678,851
  Leasehold improvements....................................    24,795,276     24,995,073
  Equipment, furniture and fixtures.........................    85,203,521     97,034,198
                                                              ------------   ------------
                                                               459,630,681    473,123,059
  Less: Accumulated depreciation and amortization...........   (18,871,618)   (45,533,274)
                                                              ------------   ------------
                                                               440,759,063    427,589,785
                                                              ------------   ------------
  Notes receivable-related parties..........................        50,321         53,192
  Cost in excess of net assets acquired.....................   155,903,555    151,335,906
  Other assets..............................................    29,826,379     20,898,296
                                                              ------------   ------------
Total assets................................................  $673,919,632   $649,292,926
                                                              ============   ============

            LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
  Accounts and contracts payable............................  $  7,551,442   $  4,427,594
  Construction payable......................................     2,200,877         60,991
  Accrued expenses..........................................    34,466,973     42,449,923
                                                              ------------   ------------
    Total current liabilities...............................    44,219,292     46,938,508
Long-term debt..............................................   400,577,205    364,003,928
Deferred income taxes.......................................    58,091,337     55,724,655
Other liabilities...........................................    28,234,008     28,139,575
                                                              ------------   ------------
    Total liabilities.......................................   531,121,842    494,806,666
                                                              ------------   ------------
Preferred stock, $.01 par value; 1,000,000 shares
  authorized, 10 Series A and 99,990 Series B 13 1/2% Senior
  Redeemable Convertible Cumulative shares outstanding
  (liquidation value $55,000,000)...........................    61,442,346     70,166,510
                                                              ------------   ------------
Commitments and contingencies (see notes 6 and 12)
Stockholders' equity
  Common stock, $.01 par value; at November 30, 2000,
    20,000,000 shares authorized and 4,078,784 shares
    issued; at November 30, 1999, 20,000,000 shares
    authorized and 4,018,790 shares issued..................        40,188         40,787
  Additional paid-in capital................................    74,959,812     74,959,213
  Retained earnings.........................................     6,355,444      9,319,750
                                                              ------------   ------------
  Total stockholders' equity................................    81,355,444     84,319,750
                                                              ------------   ------------
Total liabilities and stockholders' equity..................  $673,919,632   $649,292,926
                                                              ============   ============
</TABLE>

        The accompanying notes are an integral part of these statements.

                                       49
<PAGE>
                             HARVEYS CASINO RESORTS

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                          PREDECESSOR COMPANY (NOTE 1)
                                      ------------------------------------     FEBRUARY 2, 1999
                                         FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                            ENDED             THROUGH               THROUGH                ENDED
                                      NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                      -----------------   ----------------   ---------------------   -----------------
<S>                                   <C>                 <C>                <C>                     <C>
Revenues
  Casino............................     $244,784,494       $ 41,454,266         $229,016,000           $378,396,384
  Racing............................               --                 --              931,790              6,044,450
  Lodging...........................       34,272,546          5,958,214           31,002,326             37,862,757
  Food and beverage.................       47,078,908          8,107,313           42,989,594             59,688,194
  Other.............................        7,111,072          1,270,850            6,989,961             10,127,559
  Less: Casino promotional
    allowances......................      (23,738,316)        (5,002,943)         (22,414,697)           (30,031,626)
                                         ------------       ------------         ------------           ------------
    Total net revenues..............      309,508,704         51,787,700          288,514,974            462,087,718
                                         ------------       ------------         ------------           ------------
Costs and expenses
  Casino............................      115,836,815         21,146,422          111,340,643            182,881,768
  Racing............................               --                 --            1,858,542             11,932,117
  Lodging...........................       13,710,144          1,996,897           11,048,491             13,114,113
  Food and beverage.................       30,142,182          4,726,052           27,192,624             42,015,214
  Other operating...................        2,885,443            592,456            2,736,147              4,129,557
  Selling, general and
    administrative..................       78,986,651         13,428,090           64,045,246             95,026,838
  Depreciation and amortization.....       20,796,922          3,552,595           22,611,160             38,110,335
  Development project write-downs...           95,961            129,817            2,052,285              1,314,046
  Colony/Harveys merger costs and
    consent fees....................        1,217,720         19,879,276                   --                     --
  Costs related to terminated
    merger..........................               --                 --                   --              9,904,282
                                         ------------       ------------         ------------           ------------
  Total costs and expenses..........      263,671,838         65,451,605          242,885,138            398,428,270
                                         ------------       ------------         ------------           ------------
Operating income (loss).............       45,836,866        (13,663,905)          45,629,836             63,659,448
                                         ------------       ------------         ------------           ------------
Other income (expense)
  Interest income...................        2,258,771            337,642              124,152                201,704
  Interest expense..................      (17,835,647)        (3,015,944)         (24,272,489)           (37,890,393)
  Other, net........................         (141,059)            76,779             (549,886)              (513,589)
                                         ------------       ------------         ------------           ------------
    Total other income (expense)....      (15,717,935)        (2,601,523)         (24,698,223)           (38,202,278)
                                         ------------       ------------         ------------           ------------
Income (loss) before income taxes,
  extraordinary item and cumulative
  effect of an accounting change....       30,118,931        (16,265,428)          20,931,613             25,457,170
Income tax (provision) benefit......      (11,417,279)         3,904,000           (8,133,823)           (10,626,839)
                                         ------------       ------------         ------------           ------------
Income (loss) before extraordinary
  item..............................       18,701,652        (12,361,428)          12,797,790             14,830,331
Loss on early retirement of debt,
  net of taxes......................               --           (868,779)                  --                     --
Cumulative effect of an accounting
  change, net of taxes..............               --                 --                   --             (3,141,861)
                                         ------------       ------------         ------------           ------------
Net income (loss)...................     $ 18,701,652       $(13,230,207)        $ 12,797,790           $ 11,688,470
                                         ============       ============         ============           ============
</TABLE>

        The accompanying notes are an integral part of these statements.

                                       50
<PAGE>
                             HARVEYS CASINO RESORTS

                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                      COMMON
                                      STOCK     ADDITIONAL
                                     $.01 PAR     PAID-IN       DEFERRED     TREASURY      RETAINED
                                      VALUE       CAPITAL     COMPENSATION     STOCK       EARNINGS        TOTAL
                                     --------   -----------   ------------   ---------   ------------   ------------
<S>                                  <C>        <C>           <C>            <C>         <C>            <C>
PREDECESSOR COMPANY (NOTE 1)
Balance November 30, 1997;
  9,840,972 shares outstanding;
  12,516 shares in treasury........  $ 98,535   $39,191,390    $(148,069)    $(199,672)  $140,415,366   $179,357,550
Stock options exercised; 226,183
  shares...........................     2,262     4,309,985           --            --             --      4,312,247
Acquisition of treasury stock;
  2,044 shares.....................        --            --           --       (53,860)            --        (53,860)
Amortization of deferred
  compensation.....................        --            --      142,344            --             --        142,344
Cash dividends declared............        --            --           --            --     (2,006,298)    (2,006,298)
Net income.........................        --            --           --            --     18,701,652     18,701,652
                                     --------   -----------    ---------     ---------   ------------   ------------
Balance November 30, 1998;
  10,065,111 shares outstanding;
  14,560 shares in treasury........   100,797    43,501,375       (5,725)     (253,532)   157,110,720    200,453,635
Acquisition of treasury stock; 164
  shares...........................        --            --           --        (4,458)            --         (4,458)
Amortization of deferred
  compensation.....................        --            --        1,138            --             --          1,138
Net loss...........................        --            --           --            --    (13,230,207)   (13,230,207)
                                     --------   -----------    ---------     ---------   ------------   ------------
Balance February 1, 1999;
  10,064,947 shares outstanding;
  14,742 shares in treasury........  $100,797   $43,501,375    $  (4,587)    $(257,990)  $143,880,513   $187,220,108
                                     ========   ===========    =========     =========   ============   ============
</TABLE>

<TABLE>
<CAPTION>
                                                     COMMON STOCK
                                                  -------------------
                                                  CLASS A    CLASS B    ADDITIONAL
                                                  $.01 PAR   $.01 PAR     PAID-IN      RETAINED
                                                   VALUE      VALUE       CAPITAL      EARNINGS        TOTAL
                                                  --------   --------   -----------   -----------   -----------
<S>                                    <C>        <C>        <C>        <C>           <C>           <C>
Balance February 2, 1999; 38,800
  shares of Class A and 3,880,000
  shares of Class B outstanding......               $388     $38,800    $74,960,812   $        --   $75,000,000
Restricted stock awards, net of
  forfeitures; 990 shares of Class A
  and 99,000 shares of Class B.......                 10         990         (1,000)           --            --
Dividends accrued on preferred
  stock..............................                 --          --             --    (6,442,346)   (6,442,346)
Net income...........................                 --          --             --    12,797,790    12,797,790
                                                    ----     -------    -----------   -----------   -----------
Balance November 30, 1999: 39,790
  shares of Class A and 3,979,000
  shares of Class B outstanding......                398      39,790     74,959,812     6,355,444    81,355,444
Restricted stock awards, net of
  cancellations and conversion to
  deferred compensation; 602 shares
  of Class A and 59,392 shares of
  Class B............................                  6         593           (599)           --            --
Dividends accrued on preferred
  stock..............................                 --          --             --    (8,724,164)   (8,724,164)
Net income...........................                 --          --             --    11,688,470    11,688,470
                                                    ----     -------    -----------   -----------   -----------
Balance November 30, 2000; 40,392
  shares of Class A and 4,038,392
  shares of Class B outstanding......               $404     $40,383    $74,959,213   $ 9,319,750   $84,319,750
                                                    ====     =======    ===========   ===========   ===========
</TABLE>

        The accompanying notes are an integral part of these statements.

                                       51
<PAGE>
                             HARVEYS CASINO RESORTS

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                          PREDECESSOR COMPANY (NOTE 1)
                                      ------------------------------------     FEBRUARY 2, 1999
                                         FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                            ENDED             THROUGH               THROUGH                ENDED
                                      NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                      -----------------   ----------------   ---------------------   -----------------
<S>                                   <C>                 <C>                <C>                     <C>
Cash flows from operating activities
Net income (loss)...................     $ 18,701,652       $(13,230,207)        $  12,797,790          $ 11,688,470
Adjustments to reconcile net income
  (loss) to net cash provided by
  operating activities:
  Depreciation and amortization.....       20,796,922          3,552,594            19,648,761            27,334,666
  Amortization of intangible
    assets..........................               --                 --             2,962,399            10,775,669
  Development project write-down....               --                 --                    --             1,314,046
  Amortization of deferred
    compensation....................          142,344              1,137             1,167,233             1,847,226
  Amortization of debt issuance
    costs...........................        1,078,423            506,428               841,276             1,651,348
  Amortization of premium on long
    term debt.......................               --                 --              (846,413)           (1,025,784)
  Retirement of debt issuance costs,
    net of tax......................               --            868,779                    --                    --
  Cumulative effect of an accounting
    change..........................               --                 --                    --             4,586,861
  Deferred income taxes.............        2,052,065            135,141             1,347,616            (7,312,829)
  Expensed consent fees and Colony/
    Harveys merger costs............               --         19,879 276                    --                    --
  Loss on disposition of assets.....               --             35,828               466,554               411,777
  Other.............................           98,808                 --                    --                    --
  (Increase) decrease in assets
    Accounts receivable, net........          697,668         (1,355,803)              817,289              (535,906)
    Inventories.....................           37,178           (112,741)             (150,864)              124,520
    Prepaid expenses and other
      current assets................          961,311           (207,747)            1,643,873              (528,637)
    Other assets....................       (3,874,864)          (772,631)            7,452,500              (591,527)
  Increase (decrease) in liabilities
    Accounts and contracts
      payable.......................       (1,567,028)         1,084,299               317,225            (3,123,848)
    Accrued expenses................       (3,109,188)        (5,914,890)           (9,991,624)            7,351,986
    Other liabilities...............        2,372,291            325,806            (1,206,268)           (1,310,695)
                                         ------------       ------------         -------------          ------------
      Net cash provided by operating
        activities..................       38,387,582          4,795,269            37,267,347            52,657,343
                                         ------------       ------------         -------------          ------------
Cash flows from investing activities
  Proceeds from disposition of
    assets..........................          138,463             14,180               239,982               184,189
  Capital expenditures..............      (17,680,546)        (3,830,177)          (26,725,901)          (18,619,046)
  Increase (decrease) in
    construction payables...........          608,660           (261,554)            1,853,771            (2,139,886)
  Proceeds from sale of marketable
    securities......................               --         10,000,000               657,245                    --
  Purchase of marketable
    securities......................      (10,657,245)                --                    --                    --
  Advances to employees.............          (78,796)           (49,409)               (7,097)               (3,157)
  Proceeds from notes receivable....           79,730              1,300             1,879,716                   286
  Investment in Bluffs Run, net of
    cash acquired...................               --                 --          (107,212,243)                   --
                                         ------------       ------------         -------------          ------------
    Net cash provided by (used in)
      investing activities..........      (27,589,734)         5,874,340          (129,314,527)          (20,577,614)
                                         ------------       ------------         -------------          ------------
</TABLE>

        The accompanying notes are an integral part of these statements.

                                       52
<PAGE>
                             HARVEYS CASINO RESORTS

               CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

<TABLE>
<CAPTION>
                                          PREDECESSOR COMPANY (NOTE 1)
                                      ------------------------------------     FEBRUARY 2, 1999
                                         FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                            ENDED             THROUGH               THROUGH                ENDED
                                      NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                      -----------------   ----------------   ---------------------   -----------------
<S>                                   <C>                 <C>                <C>                     <C>
Cash flows from financing activities
  Net borrowings (payments) under
    revolving credit agreements.....               --                 --            71,923,618           (35,547,493)
  Principal payments on long-term
    debt............................         (633,354)          (220,304)                   --                    --
  Dividends paid....................       (2,006,298)                --                    --                    --
  Debt issuance costs...............         (152,214)           (27,359)           (5,217,561)             (382,973)
  Stock options exercised...........        4,312,247                 --                    --                    --
  Consent fees and Colony/Harveys
    merger costs....................               --                 --           (19,879,276)                   --
  Acquisition of treasury stock.....          (53,860)            (4,458)                   --                    --
                                         ------------       ------------         -------------          ------------
    Net cash provided by (used in)
      financing activities..........        1,466,521           (252,121)           46,826,781           (35,930,466)
                                         ------------       ------------         -------------          ------------
    Increase (decrease) in cash and
      cash equivalents..............       12,264,369         10,417,488           (45,220,399)           (3,850,737)
Cash and cash equivalents at
  beginning of period...............       55,034,861         67,299,230            77,716,718            32,496,319
                                         ------------       ------------         -------------          ------------
Cash and cash equivalents at end of
  period............................     $ 67,299,230       $ 77,716,718         $  32,496,319          $ 28,645,582
                                         ============       ============         =============          ============
Supplemental disclosure of cash flow
  information:
  Cash paid for interest, net of
    amounts capitalized.............     $ 16,631,889       $     98,858         $  24,746,300          $ 38,275,914
  Cash paid for income taxes........       17,705,000                 --               318,000            13,341,210
  Assumption of debt related to
    merger..........................               --                 --           172,000,000                    --
In connection with the Bluffs Run
  Casino acquisition, the Company
  assumed liabilities as follows:
  Fair value of assets acquired.....               --                 --         $ 130,601,665                    --
  Cash paid for the acquisition,
    including acquisition costs.....               --                 --          (116,605,508)                   --
                                                                                 -------------
  Liabilities assumed and amount
    payable to seller...............               --                 --         $  13,996,157                    --
                                                                                 =============
</TABLE>

        The accompanying notes are an integral part of these statements.

                                       53
<PAGE>
                             HARVEYS CASINO RESORTS

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

    In the following footnotes, the words, "Company," or "Harveys," refer to
Harveys Casino Resorts, a Nevada corporation, and its wholly-owned subsidiaries
unless the context requires otherwise.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    BASIS OF PRESENTATION AND CONSOLIDATION

    Harveys has been engaged in the casino entertainment industry for over
56 years. On February 2, 1999, Harveys Acquisition Corporation merged with and
into Harveys (the "Colony/Harveys merger"). Harveys was the surviving
corporation in the merger and is continuing business operations as conducted
prior to the merger. Harveys Tahoe Management Company, Inc., a wholly-owned
subsidiary, owns and operates Harveys Resort & Casino on the south shore of Lake
Tahoe, Nevada. Harveys Iowa Management Company, Inc., a wholly-owned subsidiary,
is the owner and operator of Harveys Casino Hotel, a riverboat casino, hotel and
convention center complex in Council Bluffs, Iowa. On October 6, 1999, HBR
Realty Company, Inc., a wholly-owned subsidiary, purchased the net assets of
Bluffs Run Casino, a greyhound racetrack and land-based casino in Council
Bluffs, Iowa. Harveys C. C. Management Company, Inc., a wholly-owned subsidiary,
owns and operates Harveys Wagon Wheel Hotel/Casino in Central City, Colorado.

    The Colony/Harveys merger was accounted for as a purchase. This required an
allocation of the purchase price to the individual assets acquired and
liabilities assumed based on their fair value at the time of the merger. As a
result, the consolidated financial statements for the periods after the merger
are presented on a different basis of accounting from those for the periods
before the merger and, therefore, are not directly comparable. The accompanying
consolidated statements of operations and consolidated statements of cash flows
for periods prior to the merger are captioned as the predecessor company and are
shown for informational purposes.

    The October 6, 1999 acquisition of the net assets of Bluffs Run Casino was
accounted for as a purchase. Consequently, the net assets acquired are included
in the consolidated balance sheet based on their fair value as of the date of
acquisition. The consolidated statement of operations includes the revenues and
expenses of Bluffs Run Casino from the date of acquisition.

    The consolidated financial statements include the accounts of Harveys and
its wholly-owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.

    USE OF ESTIMATES

    The preparation of financial statements in conformity with generally
accepted accounting principles requires the use of estimates and assumptions
that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.

    CASH AND CASH EQUIVALENTS

    Cash and cash equivalents consist of cash on hand and in banks, interest
bearing deposits and highly liquid debt instruments purchased with initial
maturities of three months or less. Cash equivalents are carried at cost which
approximates market value. Cash and cash equivalents at November 30, 1999 and
2000 included approximately $878,000 and $868,000, respectively, related to
pari-mutuel taxes which were restricted for distribution to the taxing
authorities, and approximately $1.0 million at November 30, 1999 required by the
Iowa State Racing and Gaming Commission to guarantee the payment of wagering
taxes.

                                       54
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    INVENTORIES

    Inventories consist primarily of operating supplies and food and beverage
stock and are stated at the lower of weighted-average cost or market.

    PROPERTY, EQUIPMENT AND DEPRECIATION

    Property and equipment are stated at cost. Interest incurred during
construction is capitalized and amortized over the life of the asset. Costs of
improvements are capitalized. Costs of normal repairs and maintenance are
charged to expense as incurred. On the sale or retirement of property and
equipment, the cost and related accumulated depreciation are removed from the
respective accounts and resulting gain or loss is included in income.
Depreciation of property and equipment is provided for on the straight-line
method over the estimated useful lives of the respective assets. Leasehold
improvements are amortized over the shorter of the asset life or lease term.
Depreciable lives are as follows:

<TABLE>
<S>                                                           <C>
Buildings and improvements..................................  15 to 45 years
Riverboat...................................................        20 years
Leasehold improvements......................................   5 to 30 years
Equipment, furniture and fixtures...........................   5 to 10 years
</TABLE>

    UNAMORTIZED LOAN COSTS AND DEBT ISSUANCE COSTS

    Loan costs incurred in connection with a reducing revolving credit agreement
are amortized to interest expense over the term of the loan on a straight-line
method. Debt issuance costs associated with the Company's senior subordinated
notes are amortized to interest expense over the term of the notes on the
interest method.

    COSTS IN EXCESS OF NET ASSETS ACQUIRED

    Costs in excess of net assets acquired consist primarily of goodwill
acquired in the Colony/Harveys merger ($66.9 million), which is being amortized
over 40 years, and the value assigned to the operating agreement in the Bluffs
Run Casino acquisition ($91.6 million), a substantial portion of which is being
amortized over the 25 year life of the associated management and lease
agreement.

    CASINO REVENUES AND PROMOTIONAL ALLOWANCES

    In accordance with industry practice, Harveys recognizes as casino revenues
the net win from gaming activities, which is the difference between gaming wins
and losses. Promotional allowances consist principally of the retail value of
complimentary rooms, food, beverage, and other promotional allowances provided
to customers without charge. Harveys classifies the estimated costs of providing

                                       55
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
those complimentary services as casino operating expenses through
interdepartmental allocations as follows:

<TABLE>
<CAPTION>
                                          PREDECESSOR COMPANY
                                  ------------------------------------     FEBRUARY 2, 1999
                                     FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                        ENDED             THROUGH               THROUGH                ENDED
                                  NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                  -----------------   ----------------   ---------------------   -----------------
<S>                               <C>                 <C>                <C>                     <C>
Hotel...........................     $ 3,247,715         $  861,685           $ 2,708,800           $ 3,554,646
Food and beverage...............      11,845,611          2,404,409            11,429,460            14,738,194
Other...........................          80,594             16,747               142,859               177,579
                                     -----------         ----------           -----------           -----------
                                     $15,173,920         $3,282,841           $14,281,119           $18,470,419
                                     ===========         ==========           ===========           ===========
</TABLE>

    ADVERTISING COSTS

    Advertising costs are expensed as incurred, except costs for direct-response
advertising, which are capitalized and amortized over the period of the related
program. Direct-response advertising costs consist primarily of production and
mailing costs associated with direct mail programs. Capitalized advertising
costs were immaterial at November 30, 1999 and 2000. Advertising costs were
expensed as follows: approximately $6.5 million in fiscal 1998, approximately
$0.9 million and $6.6 million for the periods December 1, 1998 through
February 1, 1999 and February 2, 1999 through November 30, 1999, respectively,
and approximately $10.7 million in fiscal 2000.

    INCOME TAXES

    Harveys and its subsidiaries file a consolidated federal income tax return.
Deferred tax assets and liabilities are determined based on the differences
between financial reporting and tax bases of assets and liabilities and are
measured using the enacted tax rates and laws that will be in effect when the
temporary differences are expected to be reversed. Additionally, deferred tax
assets and liabilities are separated into current and non-current amounts based
on the classification of the related assets and liabilities for financial
reporting purposes.

    FAIR VALUE OF FINANCIAL INSTRUMENTS

    Statement of Financial Accounting Standards ("SFAS") No. 107--DISCLOSURES
ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS requires the determination of fair
value for certain of the Company's assets, liabilities and contingent
liabilities.

    Long-term debt: The fair value of the bank credit facility is estimated
based on the current borrowing rates offered to the Company for debt of the same
remaining maturities. The fair value of the senior subordinated notes is
estimated based on indicative trading prices, when available. The Company
believes the carrying amount of the long-term debt approximates fair value at
November 30, 2000.

    There is no current market for the Company's preferred stock, however, the
Company believes the carrying amount including accrued dividends approximates
fair value at November 30, 2000.

                                       56
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    LONG-LIVED ASSETS

    In accordance with the provisions of SFAS No. 121--ACCOUNTING FOR THE
IMPAIRMENT OF LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO BE DISPOSED OF, the
Company reviews the carrying amount of long-lived assets and certain
identifiable intangibles whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. Such reviews have
not had a material effect on the Company's results of operations or financial
position.

    CONCENTRATIONS OF CREDIT RISK

    The Company maintains cash in bank deposit accounts which, at times, may
exceed federally insured limits. The Company has not experienced any losses in
such accounts and believes it is not exposed to any significant concentration of
credit risk on cash and cash equivalents.

    The Company extends credit to some casino, hotel and convention customers.
An allowance for doubtful accounts is provided to reduce receivables to their
carrying amount, which approximates fair value. The Company believes it is not
exposed to any significant concentration of credit risk on accounts receivable.

    FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

    Harveys is a party to financial instruments with off-balance-sheet risk in
the normal course of business. These financial instruments consist of standby
letters of credit and an interest rate cap agreement.

    The exposure to credit loss in the event of nonperformance by the other
party to the standby letters of credit or the interest rate cap agreement is
represented by the contractual amount of those instruments. The same credit
policies are used in making commitments and conditional obligations as for
on-balance-sheet instruments. The Company does not have collateral or other
security to support financial instruments with off-balance-sheet credit risk.

    RECENTLY ISSUED ACCOUNTING STANDARDS

    The FASB has issued SFAS No. 133--ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND
HEDGING ACTIVITIES, which establishes accounting and reporting standards for
derivative instruments and hedging activities. SFAS No. 133, as amended, will be
effective for the Company's fiscal year beginning December 1, 2000. Adoption of
this statement is not expected to have a material impact on the Company's
financial condition or results of operation.

    RECLASSIFICATIONS

    Certain reclassifications have been made to the prior years' consolidated
financial statements to conform to the current year presentation. These
reclassifications have no effect on net income.

2. MERGERS AND ACQUISITION

    COLONY/HARVEYS MERGER

    On February 2, 1999, Harveys Acquisition Corporation merged with and into
Harveys. Harveys Acquisition Corporation was formed at the direction of Colony
Investors III, L. P., a Delaware limited

                                       57
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2. MERGERS AND ACQUISITION (CONTINUED)
partnership, solely for the purpose of acquiring Harveys. Prior to the merger,
Harveys was a publicly held company. Following the merger, the capital stock of
Harveys Acquisition Corporation became the capital stock of Harveys.
Consequently, Colony Investors III owned approximately 95% of the common equity
interests in Harveys at November 30, 2000. The remaining common equity interests
are owned by Colony HCR Voteco, LLC, a Delaware limited liability company, and
by certain members of Harveys' management. As a result, Colony HCR Voteco can
govern all matters of Harveys that are subject to a vote of shareholders,
including the appointment of directors and the amendment of Articles of
Incorporation and Bylaws. Additionally, at November 30, 2000, Colony Investors
III owned 99.99% of the outstanding preferred stock and Colony HCR Voteco owned
the remaining .01 percent. Colony HCR Voteco is an affiliate of Colony Investors
III. Harveys was the surviving corporation in the merger and is continuing its
business operations as conducted prior to the merger. (See Note 13--SUBSEQUENT
EVENT).

    Harveys Acquisition Corporation financed the merger and paid related fees
and expenses with the following:

    - Proceeds of $75 million from the issuance of its Class A Common Stock
      (voting) to Colony HCR Voteco and its Class B Common Stock (nonvoting) to
      Colony Investors III.

    - Proceeds of $55 million from the issuance of its 13 1/2% Series A Senior
      Redeemable Convertible Cumulative Preferred Stock to Colony HCR Voteco and
      its 13 1/2% Series B Redeemable Convertible Cumulative Preferred Stock to
      Colony Investors III.

    - Borrowings of $172 million from a consortium of banks.

    - Harveys' available cash.

    Harveys recorded the net assets acquired in the merger at their fair value
at the time of the merger. The allocation of the purchase price to the assets
acquired and liabilities assumed follows (in thousands of dollars):

<TABLE>
<S>                                                           <C>
Merger consideration paid for outstanding common stock......  $ 289,252
Merger consideration paid for stock options.................      9,998
Direct costs of the merger..................................      6,647
                                                              ---------
Purchase price to be allocated..............................  $ 305,897
                                                              =========
Fair value of:
Assets acquired.............................................  $ 518,420
Cost in excess of net assets acquired (goodwill)............     66,854
Liabilities assumed.........................................   (279,377)
                                                              ---------
                                                              $ 305,897
                                                              =========
</TABLE>

    The Company incurred certain costs related to the Colony/Harveys merger and
paid consent fees to the Company's note holders (See Note 4--LONG TERM
DEBT--10 5/8% SENIOR SUBORDINATED NOTES, DUE 2006). Such costs and fees
aggregated to approximately $19.9 million.

                                       58
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2. MERGERS AND ACQUISITION (CONTINUED)
    ACQUISITION

    On October 6, 1999, HBR Realty Company purchased the net assets (excluding
the gaming equipment) of Bluffs Run Casino, the greyhound racetrack and casino
in Council Bluffs, Iowa. The facilities were purchased pursuant to a Purchase
and Sale Agreement and Joint Escrow Instructions dated as of August 31, 1999 by
and between HBR Realty Company and Iowa West Racing Association. At the closing,
the Company paid approximately $115 million in cash to Iowa West Racing
Association and approximately $1.6 million in closing costs and transaction
costs. Iowa West Racing Association also received the first $5.0 million of cash
flow from the operations of Bluffs Run Casino following the acquisition.
Additionally, Iowa West Racing Association is entitled to approximately
$8.4 million of Bluffs Run Casino's cash flow, payable in installments of
$1.35 million every six months in arrears following the acquisition. Those
semi-annual payments will continue until the fifth business day following the
date that the results of a required referendum on the continuation of gaming at
pari-mutuel racetracks, to be decided by the voters of Pottawattamie County,
Iowa, in 2002 are certified to the County Auditor of Pottawattamie County. The
Company may be required to pay additional consideration up to $50 million
pending the results of the referendum, which amount will not be accrued until
those results are known.

    Immediately after closing of the transaction, HBR Realty Company leased the
Bluffs Run Casino facilities back to Iowa West Racing Association for an initial
term of 25 years. At the same time, Iowa West Racing Association retained
Harveys BR Management Company, Inc., a wholly-owned subsidiary of the Company,
to manage the operations of Bluffs Run Casino. Iowa West Racing Association
continues to hold the pari-mutuel and gaming licenses under Iowa law. Harveys,
through its wholly-owned subsidiaries, receives management fees and lease income
generally equal to the ongoing cash flow from the operations of Bluffs Run
Casino.

    The acquisition was accounted for using purchase method accounting. The
allocation of the purchase price to the assets acquired and liabilities assumed
follows (in thousands of dollars):

<TABLE>
<S>                                                           <C>
Acquired assets:
    Cash acquired, including restricted cash of $1,761......  $  9,393
    Other current assets....................................     1,203
    Property and equipment..................................    28,443
    Intangible assets.......................................    91,562

Assumed liabilities:
    Accounts payable........................................    (1,707)
    Accrued expenses........................................    (7,288)
                                                              --------
Allocated purchase price....................................  $121,606
                                                              ========
</TABLE>

    Harveys is amortizing the cost of the intangible assets acquired (primarily
the right to operate Bluffs Run Casino under the gaming license held by Iowa
West Racing Association) over a period of 25 years.

                                       59
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2. MERGERS AND ACQUISITION (CONTINUED)
    The following unaudited pro forma information gives effect to the
Colony/Harveys merger and the October 6, 1999 acquisition of the net assets of
Bluffs Run Casino as though each of those events had occurred at the beginning
of each of the periods presented (in thousands of dollars):

<TABLE>
<CAPTION>
                                                         YEAR ENDED NOVEMBER 30,
                                                        -------------------------
                                                        PREDECESSOR
                                                          COMPANY
                                                           1998            1999
                                                        -----------      --------
<S>                                                     <C>              <C>
Net revenues..........................................    $432,524       $446,480
                                                          ========       ========
Income before extraordinary item......................    $ 16,749       $ 19,546
                                                          ========       ========
Net income............................................    $ 16,749       $ 18,677
                                                          ========       ========
</TABLE>

    TERMINATED MERGER

    During fiscal year 2000, a newly formed subsidiary of Harveys entered into a
definitive agreement with Pinnacle Entertainment, Inc. (formerly Hollywood
Park, Inc.) pursuant to which the newly formed subsidiary would acquire by
merger all the outstanding capital stock of Pinnacle (the "Harveys/Pinnacle
merger"). Consummation of the Harveys/Pinnacle merger was subject to, among
other things, regulatory approvals in the various jurisdictions in which Harveys
and Pinnacle conduct gaming operations, completion of financing for the
transaction and satisfaction of other conditions precedent. The Harveys/Pinnacle
merger was not consummated in fiscal year 2000 and, in January 2001, the Company
announced that the proposed merger transaction had been terminated by mutual
agreement of the parties. Consequently, the Company recognized charges of
approximately $9.9 million in fiscal year 2000 related to the terminated merger.

3. ACCRUED EXPENSES

    Accrued expenses consist of the following as of:

<TABLE>
<CAPTION>
                                                           NOVEMBER 30,
                                                     -------------------------
                                                        1999          2000
                                                     -----------   -----------
<S>                                                  <C>           <C>
Provision for progressive jackpot payouts..........  $ 1,020,741   $ 1,073,350
Accrued interest...................................    1,819,370       773,282
Accrued salaries, wages and other employee
  benefits.........................................    8,699,623     9,480,506
Accrued taxes other than income taxes..............    5,660,245     5,782,197
Self-funded workers' compensation and medical
  claims accrual...................................    2,548,347     3,326,961
Outstanding gaming chips and tokens................    1,198,435       899,866
Race and sports book futures and unclaimed
  winners..........................................    1,235,189     1,232,628
Accrued gaming promotional expense.................    2,979,716     2,176,511
Amounts due Iowa West Racing Association...........    4,050,000     2,700,000
Accrued costs-terminated merger....................           --     7,938,675
Income taxes (refundable) payable..................   (2,338,779)    3,918,321
Other accrued liabilities..........................    7,594,086     3,147,626
                                                     -----------   -----------
                                                     $34,466,973   $42,449,923
                                                     ===========   ===========
</TABLE>

                                       60
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4. LONG-TERM DEBT

    Long-term debt consists of the following as of:

<TABLE>
<CAPTION>
                                                          NOVEMBER 30,
                                                   ---------------------------
                                                       1999           2000
                                                   ------------   ------------
<S>                                                <C>            <C>
10 5/8% senior subordinated notes, due 2006
  (including unamortized premium of $6,653,587 in
  1999 and $5,627,803 in 2000)...................  $156,653,587   $155,627,803
Note payable to banks............................   243,923,618    208,376,125
                                                   ------------   ------------
                                                   $400,577,205   $364,003,928
                                                   ============   ============
</TABLE>

    Aggregate annual maturities of long-term debt, based on amounts borrowed as
of November 30, 2000 are as follows:

<TABLE>
<CAPTION>
YEARS ENDING NOVEMBER 30,
-------------------------
<S>                                                           <C>
2001........................................................  $         --
2002........................................................            --
2003........................................................            --
2004........................................................            --
2005........................................................   208,376,125
2006 and thereafter.........................................   150,000,000
                                                              ------------
                                                              $358,376,125
                                                              ============
</TABLE>

    10 5/8% SENIOR SUBORDINATED NOTES, DUE 2006

    Before the Colony/Harveys merger, the Company sought and received the
consent of the holders of the 10 5/8% Senior Subordinated Notes, due June 1,
2006, to amend the indenture that governs those notes. The amendments included:

       *   A one-time waiver of the applicability of the governing indenture to
           the Colony/Harveys merger, which included waivers of provisions that
           might have restricted the financing of the merger and related
           transactions.

       *   A change in the definition in the indenture of "Consolidated Cash
           Flow" that allows the add back of certain costs related to the
           Colony/Harveys merger when calculating Consolidated Cash Flow.

    Immediately after the Colony/Harveys merger, the fair market value of the
senior subordinated notes was 105% of the principal amount. Accordingly, when
the Company applied purchase method accounting to the merger, it recorded a
premium of $7.5 million relative to the senior subordinated notes. The Company
is amortizing the premium as a reduction of interest expense over the remaining
term of the notes.

    The senior subordinated notes are governed by an indenture and are general
unsecured obligations of the Company, subordinated in right of payment to all
existing and future senior debt of the Company. The senior subordinated notes
are guaranteed by each of the restricted subsidiaries of the Company (as defined
in the indenture). Each guarantee is a general unsecured obligation of the

                                       61
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4. LONG-TERM DEBT (CONTINUED)
guaranteeing restricted subsidiary, subordinated in right of payment to all
existing and future senior debt of each guaranteeing restricted subsidiary. The
guaranteeing restricted subsidiaries are Harveys C.C. Management Company, Inc.,
Harveys Iowa Management Company, Inc., Harveys LV Management Company, Inc.,
Harveys Tahoe Management Company, Inc., HBR Realty Company, Inc., and Harveys BR
Management Company, Inc. Separate financial statements of the guarantors are not
presented because the aggregate total assets, net income (loss) and net equity
of such subsidiaries are substantially equivalent to the total assets, net
income (loss) and net equity of the Company on a consolidated basis.

    Interest on the senior subordinated notes is payable semi-annually on
June 1 and December 1 of each year. The senior subordinated notes will mature on
June 1, 2006. The senior subordinated notes are redeemable at the option of the
Company, in whole or in part, at any time on or after June 1, 2001 at prices
ranging from 105.313% of the principal amount plus accrued and unpaid interest
to 100% of the principal amount plus accrued and unpaid interest beginning
June 1, 2004 and thereafter. Upon a change of control (as defined in the
indenture) each holder of the senior subordinated notes will have the right to
require the Company to repurchase such holder's senior subordinated notes at
101% of the principal amount plus accrued and unpaid interest to the repurchase
date.

    The indenture contains certain covenants that impose limitations on, among
other things: (i) the incurrence of additional indebtedness by the Company,
(ii) the payment of dividends, (iii) the repurchase of capital stock and the
making of certain other restricted payments and restricted investments (each as
defined in the indenture), (iv) mergers, consolidations and sales of assets,
(v) the creation or incurrence of liens on the assets of the Company, and
(vi) transactions by the Company or any of its subsidiaries with affiliates (as
defined in the indenture). These limitations are subject to a number of
qualifications and exceptions as described in the indenture. The Company was in
compliance with these covenants at November 30, 2000.

    NOTE PAYABLE TO BANKS

    At the time of the Colony/Harveys merger, the Company replaced its existing
bank credit facility with an amended and restated credit facility, under which
it assumed the liability for Harveys Acquisition Corporation's initial borrowing
of $172 million. In financing the acquisition of the net assets of Bluffs Run
Casino, the Company again amended and restated its bank credit facility.

    This second amended and restated credit facility, dated as of October 5,
1999, provides the Company with a revolving loan facility, a swingline facility
that allows it to borrow money on same-day notice and a letter of credit
facility. The Company can borrow up to $10 million dollars under the swingline
facility. The maximum available to the Company under the credit facility,
including amounts outstanding under the swingline facility and the letter of
credit was $335 million. The maximum permitted principal balance reduces
quarterly, beginning August 31, 2000. Amounts outstanding under the credit
facility will mature and be fully due and payable on September 30, 2004. Until
then, the annual year-end maximum principal balances are as follows:

<TABLE>
<CAPTION>
NOVEMBER 30,
------------
<S>                                                           <C>
2001........................................................  $314,990,000
2002........................................................   294,890,000
2003........................................................   271,440,000
</TABLE>

                                       62
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4. LONG-TERM DEBT (CONTINUED)
    At November 30, 2000, the Company had approximately $208.4 million in
outstanding borrowings and approximately $48.5 million in letter of credit
exposure.

    The Company pays interest on outstanding borrowings at a base rate plus an
applicable margin. The base rate is equal to the higher of the prime rate or the
federal funds rate plus one-half of one percent. The Company may, at its option
and under certain circumstances, elect to pay interest based on the London
Interbank Offered Rate ("LIBOR") plus an applicable margin. The applicable
margins are based on the ratio of the Company's total funded debt to its
earnings before deductions for interest, taxes, depreciation and amortization
("EBITDA"). The applicable margins are determined quarterly and are subject to
change. At November 30, 2000 the applicable margin relative to the base rate was
1.00% and the applicable margin relative to the LIBOR was 2.00%.

    The Company entered into an interest rate cap agreement, effective March 1,
2000, to reduce the potential impact of increases in interest rates on
borrowings outstanding under the bank credit facility. The notional amount of
the interest rate cap agreement was $48 million on March 1, 2000 and reduces
quarterly over the 35 month term of the agreement. The notional amount on
November 30, 2000 was approximately $34.3 million. The agreement entitles the
Company to receive from counterparties, on a monthly basis, the amount, if any,
by which the Company's interest payments on its floating LIBOR-based debt
exceeds the amount that would have been paid if the one-month LIBO rate was
capped at 7.5 percent. The combination of the interest rate cap agreement and
the terms of the credit facility result in the Company paying interest, on an
amount of variable-rate debt equal to the notional amount of the interest rate
cap agreement, at a variable rate (LIBOR plus 2.00%), not to exceed
9.50 percent.

    The amounts the banks lend under the bank facility are secured by
substantially all of the Company's assets including a pledge of the capital
stock of the Company's subsidiaries.

    The bank facility contains a number of covenants that restrict the Company's
ability to (i) dispose of assets, (ii) incur additional indebtedness,
(iii) prepay the 10 5/8% senior subordinated notes, (iv) pay dividends,
(v) create liens on assets, (vi) make investments, loans or advances,
(vii) engage in mergers or consolidations, change the Company's business, engage
in certain transactions with affiliates, and (viii) engage in certain corporate
activities. The Company is required to maintain specified financial ratios and
net worth requirements, satisfy specified financial tests, including interest
coverage tests, and maintain certain levels of annual capital expenditures. The
Company is prohibited from paying cash dividends unless the Company's leverage
ratio is less than or equal to 3 to 1. The leverage ratio is calculated by
reference to the Company's ratio of total indebtedness to EBITDA. At
November 30, 2000 the Company was in compliance with these covenants.

    The credit facility replaced a credit agreement that was in place before the
Colony/Harveys merger. Consequently, at the time of the merger, the Company
expensed all unamortized loan fees and other financing costs related to the
prior credit agreement. This expense is reflected in the consolidated statement
of operations as an extraordinary item, net of tax. The Company is amortizing
new loan fees and other financing costs over the term of the new credit
facility.

5. REDEEMABLE PREFERRED STOCK

    At November 30, 2000, the Company had outstanding 10 shares of its 13 1/2%
Series A Senior Redeemable Convertible Cumulative Preferred Stock and 99,990
shares of its 13 1/2% Series B Senior

                                       63
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5. REDEEMABLE PREFERRED STOCK (CONTINUED)
Redeemable Convertible Cumulative Preferred Stock. The Series A Preferred Stock
and Series B Preferred Stock each have a liquidation value of $550 per share.
Both series of preferred stock are entitled to quarterly dividends at an annual
rate of 13 1/2% of the liquidation value. If the dividends are not paid in cash
when due, they cumulate and compound at an annual rate of 13 1/2%. All the
outstanding preferred stock must be redeemed on February 1, 2011, for cash, at
the liquidation value plus any accrued and unpaid dividends. The Company has the
right to redeem the preferred stock, at any time, at the liquidation value plus
any accrued and unpaid dividends. The Series A Preferred Stock and Series B
Preferred Stock are convertible, at any time on or prior to February 1, 2002,
into corresponding shares of Class A Common Stock and Class B Common Stock. The
right of conversion, as it relates to the Series A and Series B Preferred Stock,
only vests in, and is only exercisable by, the current holders of the Preferred
Stock and their affiliates. The conversion rate with respect to the Series A
Preferred Stock is 2,844.6452 shares of common stock per share of preferred
stock and with respect to the Series B Preferred Stock is 28.44929681 shares of
common stock per share of preferred stock and, in each case, is subject to
customary antidilution adjustments. At the time of conversion, the Company would
have the option of satisfying any accrued and unpaid dividends due on the
preferred stock being converted by paying cash or issuing additional shares of
the corresponding Class A Common Stock or Class B Common Stock having a market
value equal to the amount of accrued dividends.

    The documents governing the preferred stock contain covenants which limit
the Company's ability to make restricted payments or investments, limit
consolidation, merger and the sale of assets, require it to provide certain
financial reports and limit its business activities. At November 30, 2000, the
Company was in compliance with those covenants.

    The combined liquidation value of the Series A Preferred Stock and Series B
Preferred Stock at November 30, 1999 and 2000 was $55 million. Additionally, on
those dates, there were approximately $6.4 million and $15.2 million,
respectively, of accrued and unpaid dividends on the preferred stock.

    On February 1, 2001, the holders of the preferred stock elected to convert
all their preferred stock to common stock (See Note 13).

6. OPERATING LEASE COMMITMENTS

    The Company's future minimum lease commitments under noncancellable
operating leases (principally for land) as of November 30, 2000 are as follows:

<TABLE>
<CAPTION>
YEARS ENDING NOVEMBER 30,
-------------------------
<S>                                                           <C>
2001........................................................  $  3,847,400
2002........................................................     3,821,000
2003........................................................     3,821,300
2004........................................................     3,912,300
2005........................................................     3,956,900
2006 and thereafter.........................................   193,309,000
</TABLE>

    Certain leases included above have provisions which require periodic
increases in the rental payments based upon the consumer price index as of
certain dates. In addition, annual lease payments under an obligation on a land
lease are based upon an escalating percentage of gross gaming revenues

                                       64
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. OPERATING LEASE COMMITMENTS (CONTINUED)
or all net revenues, whichever calculation is greater, of Harveys Resort &
Casino. The percentages applicable to gross gaming revenues and all net revenues
in fiscal 2000 and years thereafter is 3.5% and 2.35%, respectively. The actual
rent paid is the greater of the rent calculated as a percentage or a minimum
rent, as adjusted for the consumer price index. In 1997, the land lease was
extended to the year 2045. For 1998, 1999 and 2000, the Company recognized
rental expense in connection with the land lease of approximately $3.5 million,
$3.6 million and $4.0 million, respectively, which includes approximately
$0.9 million, $1.2 million and $1.3 million, respectively, above the minimum
rental amounts. Total rental expense recognized for 1998, 1999 and 2000 amounted
to approximately $3.9 million, $4.2 million and $4.5 million, respectively.

    The Company is also a lessor on several noncancellable lease agreements. Of
the rental income recognized for the years ended November 30, 1998, 1999 and
2000, approximately $380,000, $634,000 and $505,000, respectively, represents
rents received as a percentage of gross receipts. The remaining amounts are
attributable to specified minimum rent. Future minimum payments due to the
Company under these noncancellable lease agreements are as follows:

<TABLE>
<CAPTION>
YEARS ENDING NOVEMBER 30,
-------------------------
<S>                                                           <C>
2001........................................................  $693,700
2002........................................................   308,500
2003........................................................    87,500
2004........................................................    70,500
2005........................................................    54,700
</TABLE>

7. DEVELOPMENT PROJECT WRITE-DOWNS

    In fiscal year 2000, Harveys reviewed its business development plans as they
related to a proposed resort in Salisbury Beach, Massachusetts. As a result of
that review, the Company abandoned the project and wrote-off approximately
$1.3 million of real estate options and architectural designs. In fiscal year
1999, the Company wrote-off approximately $2.0 million related to a proposed
casino project in Las Vegas which the Company chose not to pursue.

8. CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE

    Effective December 1, 1999, the Company adopted Statement of Position
("SOP") 98-5, Reporting on the Costs of Start-Up Activities. SOP 98-5 requires
costs of start-up activities (commonly referred to as preopening costs in the
gaming industry) to be expensed as incurred. The initial effect of adopting SOP
98-5 is reported as the cumulative effect of a change in accounting principle.
As required, all capitalized preopening costs as of December 1, 1999 were
written off. These costs included previously deferred organization and licensing
costs. The write-offs resulted in a charge of approximately $3.1 million, net of
an income tax benefit of approximately $1.4 million.

                                       65
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9. INCOME TAXES

    The provision for income taxes consists of the following:

<TABLE>
<CAPTION>
                                       PREDECESSOR COMPANY
                               ------------------------------------     FEBRUARY 2, 1999
                                  FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                     ENDED             THROUGH               THROUGH                ENDED
                               NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                               -----------------   ----------------   ---------------------   -----------------
<S>                            <C>                 <C>                <C>                     <C>
Current......................     $ 9,365,214        $(4,039,141)          $6,786,207            $17,939,668
Deferred.....................       2,052,065            135,141            1,347,616             (7,312,829)
                                  -----------        -----------           ----------            -----------
Income tax provision before
  extraordinary item and
  accounting change..........      11,417,279         (3,904,000)           8,133,823             10,626,839
Income tax benefit of
  extraordinary item.........              --           (275,000)                  --                     --
Income tax benefit of the
  cumulative effect of an
  accounting change..........              --                 --                   --             (1,445,000)
                                  -----------        -----------           ----------            -----------
Income tax provision.........     $11,417,279        $(4,179,000)          $8,133,823            $ 9,181,839
                                  ===========        ===========           ==========            ===========
</TABLE>

    The difference between the Company's provision for income taxes as presented
in the accompanying consolidated statements of operations, and the provision for
income taxes computed at the statutory rate is comprised of the items shown in
the following table as a percent of pre-tax earnings.

<TABLE>
<CAPTION>
                                          PREDECESSOR COMPANY
                                  ------------------------------------     FEBRUARY 2, 1999
                                     FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                        ENDED             THROUGH               THROUGH                ENDED
                                  NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                  -----------------   ----------------   ---------------------   -----------------
<S>                               <C>                 <C>                <C>                     <C>
Federal income tax provision
  (benefit) at the statutory
  rate..........................        35.0%              (34.0)%               34.0%                 35.0%
Non-deductible expenses.........         2.3                 5.9                  3.4                   4.0
Tax credits.....................        (0.3)               (0.2)                (0.7)                 (0.6)
Tax exempt income...............        (0.5)               (0.1)                (0.5)                   --
State income tax, net of federal
  benefit.......................         1.9                  --                  6.4                   3.3
Other, net......................        (0.5)                4.4                 (3.7)                   --
                                        ----               -----                 ----                  ----
                                        37.9%              (24.0)%               38.9%                 41.7%
                                        ====               =====                 ====                  ====
</TABLE>

                                       66
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9. INCOME TAXES (CONTINUED)
    The components of the deferred income tax assets and liabilities as
presented in the consolidated balance sheets, are as follows at November 30:

<TABLE>
<CAPTION>
                                                               1999           2000
                                                           ------------   ------------
<S>                                                        <C>            <C>
DEFERRED TAX ASSET:
  Accrued compensation...................................  $  7,673,063   $  8,624,867
  Other accrued expenses.................................     7,772,388     15,181,119
                                                           ------------   ------------
                                                             15,445,451     23,805,986
                                                           ------------   ------------
DEFERRED TAX LIABILITY:
  Prepaid expenses.......................................    (1,259,605)    (1,873,813)
  Property and equipment.................................   (69,135,726)   (69,569,224)
                                                           ------------   ------------
                                                            (70,395,331)   (71,443,037)
                                                           ------------   ------------
  Net deferred tax liability.............................  $(54,949,880)  $(47,637,051)
                                                           ============   ============

  Current deferred asset.................................  $  3,141,457   $  8,087,604
  Noncurrent deferred liability..........................   (58,091,337)   (55,724,655)
                                                           ------------   ------------
  Net deferred tax liability.............................  $(54,949,880)  $(47,637,051)
                                                           ============   ============
</TABLE>

    The Internal Revenue Service is currently examining the Company's
consolidated federal corporate tax return for the fiscal year ended
November 30, 1998. The examination is ongoing and no adjustments have been
proposed. In the opinion of management, any tax liability arising from this
examination will not have a material adverse effect on the Company's
consolidated financial statements.

10. STOCK-BASED COMPENSATION

    Prior to the Colony/Harveys merger, the Company had adopted a 1993 Omnibus
Stock Incentive Plan, a 1996 Omnibus Stock Incentive Plan and a 1993
Non-Employee Directors' Stock Option Plan. Under these plans, the Company had
made various awards of restricted stock and stock options and, pursuant to
employment contracts with two directors who were also employees, had granted
stock options outside of the plans.

    At the effective time of the Colony/Harveys merger, February 2, 1999, all
outstanding unvested stock options and restricted stock grants vested. At that
time, all outstanding stock options were canceled in return for a cash payment
equal to the product of (i) the number of shares of Harveys common stock subject
to the option and (ii) the excess of $28.7343 (the price paid per share of
Harveys common stock in the merger) over the exercise price per share of Harveys
common stock as provided in the stock option. As a result of the merger, each
outstanding share of Harveys common stock, including the restricted stock
grants, was converted into the right to receive $28.7343.

    Following the merger, the 1993 Omnibus Stock Incentive Plan, the 1996
Omnibus Stock Incentive Plan and the 1993 Non-Employee Director's Stock Option
Program were terminated.

    On February 2, 1999, the Company adopted the 1999 Omnibus Incentive Plan.
Under the plan, shares of the Company's common stock may be granted to officers,
directors or employees of the Company or to consultants or advisors to the
Company. Grants under the plan may consist of stock

                                       67
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10. STOCK-BASED COMPENSATION (CONTINUED)
options, stock appreciation rights or limited stock appreciation rights,
restricted stock, performance shares, deferred stock or any combination of the
foregoing. The plan is administered by the Company's board of directors who have
the power to select participants to receive grants, determine what grants are to
be awarded and determine the terms and conditions, not inconsistent with the
terms of the plan, which apply to any award granted under the plan.

    The total number of shares of Class A Common Stock reserved under the plan
is 4,000 and the total number of shares of Class B Common Stock reserved under
the plan is 400,000.

    Stock options granted under the plan may be of two types: (i) incentive
stock options within the meaning of Section 422 of the Internal Revenue Code, as
amended from time to time and (ii) non-qualified stock options. During 1999 and
2000, the Company granted to certain officers and employees incentive stock
options and non-qualified stock options to acquire shares of the Company's
Class A Common Stock and Class B Common Stock. The stock options granted during
1999 vest 20% on each of the first five anniversaries of the date of grant. The
stock options granted during 2000 generally vested 20% immediately and an
additional 20% on each of the first four anniversaries of February 2, 2000. The
option price per share of stock subject to stock options granted was equal to or
greater than the fair market value of the underlying stock on the date of grant.
The term of the stock options granted is ten years.

    During 1999 and 2000, the Company granted certain key executives restricted
shares of the Company's Class A Common Stock and Class B Common Stock. The
restrictions with respect to the 1999 grants lapse 20% per year. With respect to
the 2000 grants, restrictions lapse based on the passage of time, through
February 2, 2004, subject to the achievement of certain financial performance
targets at Bluffs Run Casino and the passage of the referendum on the
continuation of gaming at pari-mutuel racetracks, to be decided by the voters of
Pottawattamie County, Iowa in 2002. Under certain conditions, the restricted
shares may be canceled and an equivalent number of deemed shares created under a
deferred compensation arrangement, under which the Company may be obligated to
the executives for the fair market value of the deemed shares. The Company
accrued compensation expense of $464,000 and $1,216,000 relating to the vesting
of the restricted shares in 1999 and 2000, respectively, and recorded the
associated amount as part of other liabilities on the accompanying consolidated
balance sheets.

    As a result of the Colony/Harveys merger, the rights of certain key
executives to participate in the supplemental executive retirement plan were
terminated, with 50% of the accrued benefits paid out in cash and the remainder
transferred to a deemed share account in a deferred compensation arrangement
under which the Company will be obligated to the executives for the fair market
value of the deemed shares. The Company accrued compensation expense of $703,000
and $632,000 relating to the increase in the estimated value of the deemed
shares in 1999 and 2000, respectively. In 2000, the Company made a cash payment
of $418,000 to an executive who had resigned, in satisfaction of the Company's
liability to that executive. The remaining obligation of $2,233,000 is included
as part of other liabilities on the accompanying consolidated balance sheet at
November 30, 2000.

                                       68
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10. STOCK-BASED COMPENSATION (CONTINUED)
    The following table summarizes information relative to stock options
granted, exercised, canceled, outstanding and exercisable under the various
plans discussed above:

<TABLE>
<CAPTION>
                                                                          WEIGHTED-AVERAGE
                                                               OPTIONS     EXERCISE PRICE
                                                              ---------   ----------------
<S>                                                           <C>         <C>
Options outstanding at December 1, 1997.....................  1,015,460        $15.69
Options granted.............................................     17,500         27.16
Options canceled............................................    (19,515)        17.19
Options exercised...........................................   (226,183)        14.95
                                                              ---------

Options outstanding at November 30, 1998....................    787,262         16.02
Options exercised...........................................     (1,139)        16.96
Options cashed out at the effective time of the merger......   (786,123)        16.02
                                                              ---------

Options outstanding at February 2, 1999.....................         --            --
                                                              =========
Options granted.............................................    189,210         20.06
Options canceled............................................    (37,370)        20.06
                                                              ---------

Options outstanding at November 30, 1999....................    151,840         20.06
Options granted.............................................     43,840         33.61
Options canceled............................................     (4,647)        25.49
Options exercised...........................................        (87)        20.06
                                                              ---------

Options outstanding at November 30, 2000....................    190,946         23.04
                                                              =========

Options exercisable at November 30, 1998....................    347,992         15.25
Options exercisable at November 30, 1999....................         --            --
Options exercisable at November 30, 2000....................     37,646         22.78
</TABLE>

    The following table provides additional information relative to stock
options outstanding at November 30, 2000:

<TABLE>
<CAPTION>
                                                 OPTIONS OUTSTANDING
                                  -------------------------------------------------
                                                WEIGHTED-AVERAGE                           OPTIONS EXERCISABLE
                                                   REMAINING                          ------------------------------
RANGE OF                            NUMBER        CONTRACTUAL      WEIGHTED-AVERAGE     NUMBER      WEIGHTED-AVERAGE
EXERCISE PRICES                   OUTSTANDING    LIFE IN YEARS      EXERCISE PRICE    EXERCISABLE    EXERCISE PRICE
---------------                   -----------   ----------------   ----------------   -----------   ----------------
<S>                               <C>           <C>                <C>                <C>           <C>
$20.060  $20.060................    149,040           8.30             $20.060          29,805          $20.060
$33.109  $33.109................     38,906           9.48             $33.109           7,841          $33.109
$38.530  $38.530................      1,000           9.63             $38.530              --               --
$41.310  $41.310................      2,000           9.80             $41.310              --               --
                                    -------           ----             -------          ------          -------
$20.060  $41.310................    190,946           8.57             $23.038          37,646          $22.778
</TABLE>

    The FASB has issued SFAS No. 123--ACCOUNTING FOR STOCK-BASED COMPENSATION.
SFAS No. 123 provides, among other things, that companies may elect to either
record expense based on the fair value of stock-based compensation upon issuance
or continue to apply the methods prescribed by

                                       69
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10. STOCK-BASED COMPENSATION (CONTINUED)
Accounting Principles Board Opinion No. 25 ("APB No. 25") whereby no
compensation cost is recognized upon grant if certain requirements are met. The
Company elected to continue to account for stock-based compensation in
accordance with APB No. 25.

    Had the Company recorded stock-based compensation cost consistent with the
provisions of SFAS No. 123, net income for fiscal year 1998 would have been
reduced to the pro forma amounts included in the table below. The table also
discloses the weighted-average assumptions used in estimating the fair value of
stock options using the Black-Scholes option pricing model and the
weighted-average fair value of the stock options granted. The Black-Scholes
option valuation model was developed for use in estimating the fair value of
traded options, which have no vesting restrictions and are fully transferable.
Additionally, option valuation models require the input of highly subjective
assumptions including the expected stock price volatility. Because the Company's
stock-based compensation has characteristics significantly different from those
of traded options, and because changes in the subjective input assumptions can
materially affect the fair value estimate, in our opinion, the existing models
do not necessarily provide a reliable single measure of the fair value of the
Company's stock-based compensation.

<TABLE>
<CAPTION>
                                                              PREDECESSOR COMPANY
                                                                   YEAR ENDED
                                                               NOVEMBER 30, 1998
                                                              --------------------
                                                              DOLLARS IN THOUSANDS
<S>                                                           <C>
Income before extraordinary item
  As reported...............................................        $18,702
  Pro forma.................................................         17,938
Net income
  As reported...............................................        $18,702
  Pro forma.................................................         17,938

Weighted-average assumptions
  Expected stock price volatility...........................          31.24%
  Risk-free interest rate...................................           5.07%
  Expected option lives (years).............................           3.44
  Expected dividend yield...................................           0.80%
  Estimated fair value of options granted...................        $  6.53
</TABLE>

    The stock-based compensation cost calculated pursuant to the provisions of
SFAS No. 123 would have an immaterial effect on net income for the period ended
November 30, 1999 and the year ended November 30, 2000.

                                       70
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. EMPLOYEE BENEFIT PLANS

    401(K) PLAN

    The Company maintains a defined contribution retirement savings plan for all
full-time employees who have at least one year of continuous employment and
1,000 hours of service. The Company contributes amounts equal to 50% of each
eligible employee's voluntary contributions. For purposes of determining the
Company's required contribution to the plan, the employee's voluntary
contributions cannot exceed 6% of the employee's qualified compensation. The
Company's contribution to the plan for the year ended November 30, 1998 amounted
to approximately $1.4 million. The Company's contribution to the plan for the
period of December 1, 1998 through February 1, 1999 and the period February 2,
1999 through November 30, 1999 amounted to approximately $418,000 and
$1.1 million, respectively. The Company's contribution to the plan for the year
ended November 30, 2000 amounted to approximately $1.6 million.

    LONG-TERM INCENTIVE PLAN

    In 1994, the Company adopted a long-term incentive plan for key employees.
Under the plan, incentives were accrued based upon annual operating results;
however, ultimate payment of these incentives was contingent upon the Company
attaining certain financial objectives over consecutive and concurrent
three-year periods. As of November 30, 1998, the amount due to plan participants
was approximately $1.6 million. At the effective time of the Colony/Harveys
merger, the Company terminated the long-term incentive plan and made final lump
sum payments, at the maximum payout value, to the participants in the aggregate
amount of approximately $3.1 million.

    DEFERRED COMPENSATION PLAN

    In 1990, the Company established a non-qualified deferred compensation plan
for designated executives and outside directors. Individuals electing to
participate in this plan may voluntarily defer receipt of up to twenty-five
percent (25%) of their annual compensation. The Company credits deferred
compensation to each participant's account, and adds interest on such amounts to
the participant's account each quarter. The interest rate paid on amounts
deferred prior to calendar year 1995 is the prime rate at the beginning of each
quarter plus five percent (14.50% at November 30, 2000). The interest rate paid
on amounts deferred subsequent to December 31, 1994 is the prime rate plus two
and one-half percent (12.00% at November 30, 2000). The Company is under no
obligation to fund amounts under this plan, and such amounts are unsecured and
treated as general obligations of the Company. As of November 30, 1999 and 2000,
the amount due participants in this plan was approximately $3.4 million and
$3.8 million, respectively.

    POSTRETIREMENT BENEFITS

    The Company provides postretirement medical benefits for certain key
executives and members of the Company's board of directors. The Company had
elected to amortize, over a period of 20 years the accumulated postretirement
benefit obligation (transition obligation) related to prior service costs. At
the effective time of the Colony/Harveys merger, the application of purchase
method accounting required Harveys to recognize as a liability the unamortized
accumulated postretirement benefit obligation, unrecognized prior service cost
and any unrecognized net loss. As a result, the Company recognized an additional
increase in the net liability attributable to the post retirement benefit plan
of approximately $422,000.

                                       71
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. EMPLOYEE BENEFIT PLANS (CONTINUED)
    The following table reconciles the unfunded status of our plan with the
accrued postretirement benefit liability recognized in our consolidated balance
sheets.

<TABLE>
<CAPTION>
                                            PREDECESSOR COMPANY
                                    ------------------------------------     FEBRUARY 2, 1999
                                       FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                          ENDED             THROUGH               THROUGH                ENDED
                                    NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                    -----------------   ----------------   ---------------------   -----------------
<S>                                 <C>                 <C>                <C>                     <C>
CHANGE IN BENEFIT OBLIGATION:
  Beginning of period.............     $   915,072        $ 1,143,780           $ 1,262,493           $ 1,228,297
  Service cost....................          78,782             13,679                43,077                64,863
  Interest Cost...................          67,884             13,492                69,771               103,401
  Change in discount rate.........          69,633                 --               (55,800)                   --
  Experience loss.................          17,374             91,542                40,217               175,222
  Benefits paid...................          (4,965)                --              (131,461)             (113,403)
                                       -----------        -----------           -----------           -----------
  End of period...................     $ 1,143,780        $ 1,262,493           $ 1,228,297           $ 1,458,380
                                       ===========        ===========           ===========           ===========
CHANGE IN PLAN ASSETS:
  Fair value of plan assets at
    beginning of period...........              --                 --                    --                    --
  Actual return on plan assets....              --                 --                    --                    --
  Employer contribution...........           4,965                 --               131,461               113,403
  Benefits paid...................          (4,965)                --              (131,461)             (113,403)
                                       -----------        -----------           -----------           -----------
  Fair value of plan assets at end
    of period.....................              --                 --                    --                    --

  Funded status...................        (810,435)        (1,262,493)           (1,228,297)           (1,458,380)
  Unrecognized actuarial loss.....         (73,418)                --               (15,583)              159,639
  Unrecognized prior service
    cost..........................         (89,181)                --                    --                    --
  Unrecognized net initial asset
    (obligation)..................        (170,746)                --                    --                    --
                                       -----------        -----------           -----------           -----------
  Accrued benefit liability.......     $(1,143,780)       $(1,262,493)          $(1,243,880)          $(1,298,741)
                                       ===========        ===========           ===========           ===========
</TABLE>

    For the periods ending November 30, 1999 and 2000 a discount rate of 7.75%
was used to arrive at year-end obligations. For fiscal year ending November 30,
1998 a discount rate of 6.75% was used. The Company assumed future medical costs
will increase 6% per year.

                                       72
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. EMPLOYEE BENEFIT PLANS (CONTINUED)
    The Company's current policy is to fund the plan as covered benefits are
paid. The following table sets forth the components of the net periodic
postretirement benefit costs.

<TABLE>
<CAPTION>
                                            PREDECESSOR COMPANY
                                    ------------------------------------     FEBRUARY 2, 1999
                                       FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                          ENDED             THROUGH               THROUGH                ENDED
                                    NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                    -----------------   ----------------   ---------------------   -----------------
<S>                                 <C>                 <C>                <C>                     <C>
COMPONENTS OF NET PERIODIC
  POSTRETIREMENT BENEFIT COSTS:
  Service cost....................      $ 78,782            $13,679              $ 43,077              $ 64,863
  Interest cost...................        67,884             13,492                69,771               103,401
  Expected return on plan
    assets........................            --                 --                    --                    --
  Amortization of unrecognized
    transition obligation.........        12,197              2,033                    --                    --
  Amortization of prior service
    cost..........................         6,683              1,114                    --                    --
  Recognized net actuarial loss...            --                115                    --                    --
                                        --------            -------              --------              --------
  Net periodic postretirement
    benefit cost..................      $165,546            $30,433              $112,848              $168,264
                                        ========            =======              ========              ========
</TABLE>

    Increasing the assumed health care cost trend rates by one percentage pont
in each future year would increase the postretirement benefit obligation by
approximately $133,000 at February 1, 1999; $145,000 at November 30, 1999; and
$224,000 at November 30, 2000. A one percent increase in the assumed health care
cost trend in each future year would increase the service and interest costs
components of the net periodic benefit cost by approximately $23,000 for fiscal
year 1998; $4,000 for the period of December 1, 1998 through February 1, 1999;
$16,000 for the period from February 2, 1999 through November 30, 1999; and
$24,000 for fiscal year 2000. Likewise a one percent decrease in the assumed
health care cost trend for each future year would have decreased the
postretirement benefit obligation by approximately $100,000 at February 1, 1999;
by approximately $110,000 at November 30, 1999; and by approximately $170,000 at
November 30, 2000. A one percent decrease would have decreased the service and
interest costs components by approximately $4,000 for the period December 1,
1998 through February 1, 1999; by approximately $12,000 for the period
February 2, 1999 through November 30, 1999; and by approximately $27,000 for
fiscal year 2000.

    SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS

    The Company provides noncontributory supplemental executive retirement plans
for certain key executives. Normal retirement under the supplemental executive
retirement plans is age 65, and participants receive benefits based on years of
service and compensation. The Company also provided a noncontributory plan for
members of the Company's board of directors. At the effective time of the
Colony/Harveys merger, the application of purchase method accounting required
Harveys to recognize as a liability the unamortized accumulated benefit
obligation, unrecognized prior service cost and any unrecognized net loss. As a
result, Harveys recognized an additional increase in the liability attributable
to the supplemental executive retirement plans of approximately $4.1 million and
the elimination of a related intangible asset of approximately $2.6 million.
Additionally, at the time of the Colony/Harveys merger, those members of the
Company's board of directors who had a vested benefit in their plan

                                       73
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. EMPLOYEE BENEFIT PLANS (CONTINUED)
received a lump sum payment and that plan was terminated. The following table
reconciles the unfunded status of the Company's plan with the accrued pension
benefit liability recognized in our consolidated balance sheets.

<TABLE>
<CAPTION>
                                            PREDECESSOR COMPANY
                                    ------------------------------------     FEBRUARY 2, 1999
                                       FISCAL YEAR      DECEMBER 1, 1998   (DATE OF ACQUISITION)      FISCAL YEAR
                                          ENDED             THROUGH               THROUGH                ENDED
                                    NOVEMBER 30, 1998   FEBRUARY 1, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                    -----------------   ----------------   ---------------------   -----------------
<S>                                 <C>                 <C>                <C>                     <C>
CHANGE IN BENEFIT OBLIGATION:
  Beginning of period.............    $ 15,133,038        $ 17,841,348         $ 14,722,986          $ 13,768,076
  Service cost....................         649,139             139,118              407,543               185,419
  Interest cost...................       1,096,557             199,414              803,447             1,013,487
  Change in discount rate.........         834,570                  --           (1,481,732)                   --
  Experience (gain) or loss.......         411,618          (2,302,642)                  --              (260,199)
  Benefits paid...................        (283,574)         (1,154,252)            (684,168)             (839,656)
                                      ------------        ------------         ------------          ------------
  End of period...................    $ 17,841,348        $ 14,722,986         $ 13,768,076          $ 13,867,127
                                      ============        ============         ============          ============
CHANGE IN PLAN ASSETS:
  Fair value of plan assets at
    beginning of period...........              --                  --                   --                    --
  Actual return on plan assets....              --                  --                   --                    --
  Employer contribution...........         283,574           1,154,252              684,168               839,656
  Benefits paid...................        (283,574)         (1,154,252)            (684,168)             (839,656)
                                      ------------        ------------         ------------          ------------
  Fair value of plan assets at end
    of period.....................              --                  --                   --                    --

  Funded status...................     (17,841,348)        (14,722,986)         (13,768,076)          (13,867,127)
  Unrecognized actuarial (gain)
    loss..........................       3,763,138                  --           (1,481,732)           (1,702,295)
  Unrecognized prior service
    cost..........................       1,436,155                  --                   --                    --
  Unrecognized net initial asset
    (obligation)..................       1,542,423                  --                   --                    --
                                      ------------        ------------         ------------          ------------
  Accrued pension cost............    $(11,099,632)       $(14,722,986)        $(15,249,808)         $(15,569,422)
                                      ============        ============         ============          ============
</TABLE>

    For fiscal year ended November 30, 1998 a discount rate of 6.75 percent was
used. For the period ended November 30, 1999 and fiscal year 2000 a discount
rate of 7.75% was used to arrive at year-end obligations. The Company assumed
future salary increases of 5% per year.

                                       74
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. EMPLOYEE BENEFIT PLANS (CONTINUED)
    The following table sets forth the components of our net periodic pension
costs.

<TABLE>
<CAPTION>
                                            PREDECESSOR COMPANY
                                   -------------------------------------     FEBRUARY 2, 1999
                                      FISCAL YEAR      FEBRUARY 2, 1998    (DATE OF ACQUISITION)      FISCAL YEAR
                                         ENDED              THROUGH               THROUGH                ENDED
                                   NOVEMBER 30, 1998   NOVEMBER 30, 1999     NOVEMBER 30, 1999     NOVEMBER 30, 2000
                                   -----------------   -----------------   ---------------------   -----------------
<S>                                <C>                 <C>                 <C>                     <C>
COMPONENTS OF NET PERIODIC
  PENSION COSTS:
  Service cost...................     $  649,139           $139,118             $  407,543            $  185,419
  Interest cost..................      1,096,557            199,414                803,447             1,013,487
  Expected return on plan
    assets.......................             --                 --                     --                    --
  Amortization of unrecognized
    transition obligation........        171,699             28,617                     --                    --
  Amortization of prior service
    cost.........................        212,997             35,500                     --                    --
  Recognized net actuarial (gain)
    loss.........................        123,043             28,036                     --               (39,636)
                                      ----------           --------             ----------            ----------
  Net periodic pension cost......     $2,253,435           $430,685             $1,210,990            $1,159,270
                                      ==========           ========             ==========            ==========
</TABLE>

    SELF INSURED PLANS

    The Company is self insured for employee medical coverage and workers'
compensation for the benefit of its employees. Estimated accrued obligations for
claims under these self-insured plans as of November 30, 1999 and 2000 were
approximately $2.5 million and $3.3 million, respectively. The Company's maximum
liability under both plans is limited by stop-loss agreements with insurance
companies.

12. COMMITMENTS AND CONTINGENCIES

    LETTERS OF CREDIT

    In connection with the acquisition of the net assets of Bluffs Run Casino,
the Company was obligated to enter into an irrevocable standby letter of credit
to support $45.0 million of contingent consideration it may be obligated to pay.
In connection with regulatory requirements, the Company was required to issue
irrevocable standby letters of credit to guarantee payment of workers'
compensation benefits. Outstanding standby letters of credit as of November 30,
2000 were as follows:

<TABLE>
<CAPTION>
                                                   AMOUNT      EXPIRATION DATE
                                                 -----------   ---------------
<S>                                              <C>           <C>
Contingent purchase price consideration........  $45,000,000   October 5, 2001
St. Paul Fire and Marine (workers'
  compensation)................................    1,012,500   April 15, 2001
State of Nevada, Division of Insurance
  (workers' compensation)......................    2,500,000   April 1, 2001
                                                 -----------
                                                 $48,512,500
                                                 ===========
</TABLE>

                                       75
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

12. COMMITMENTS AND CONTINGENCIES (CONTINUED)
    EMPLOYMENT CONTRACTS

    The Company has entered into employment agreements, each of which expires
prior to February 3, 2004, with certain key executives. The employment
agreements provide for, among other things, annual base compensation,
participation in bonus plans, certain stock grants and stock option provisions.

    CLAIMS AND LEGAL ACTIONS

    The Company is involved in various claims and legal actions arising in the
ordinary course of business. In the opinion of management, all pending matters
are either adequately covered by insurance or if not covered by insurance, will
not have a material adverse effect on the Company's consolidated financial
statements taken as a whole.

13. SUBSEQUENT EVENT

    On February 1, 2001, pursuant to the documents governing the Company's
preferred stock, Colony HCR Voteco elected to convert the 10 shares of Series A
Preferred Stock held by it, representing all of the shares of Series A Preferred
Stock issued and outstanding, into shares of Class A Common Stock, par value
$.01 per share, of the Company and Colony Investors III elected to convert the
99,990 shares of Series B Preferred Stock held by it, representing all of the
shares of Series B Preferred Stock issued and outstanding, into shares of
Class B Common Stock, par value $.01 per share, of the Company. In connection
with such conversion, pursuant to the documents governing the Company's
preferred stock, the Board of Directors of the Company also elected to satisfy
the dividends on the Series A Preferred Stock accrued and unpaid as of the close
of business on the conversion date in shares of Class A Common Stock and elected
to satisfy the dividends on the Series B Preferred Stock accrued and unpaid as
of the close of business on the conversion date in shares of Class B Common
Stock. As a result of such conversion and the payment of such accrued and unpaid
dividends, Colony HCR Voteco received an aggregate of 28,484 shares of Class A
Common Stock and Colony Investors III received an aggregate of 3,229,859 shares
of Class B Common Stock.

    Immediately after the conversion, Colony HCR Voteco directly beneficially
owned 67,284 shares of Class A Common Stock, representing approximately 97.7% of
the outstanding Class A Common Stock and aggregate voting power of the Company,
and Colony Investors III directly beneficially owned 7,109,859 shares of
nonvoting Class B Common Stock.

                                       76
<PAGE>
                             HARVEYS CASINO RESORTS

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

14. SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

    The following table sets forth unaudited selected quarterly financial
information for each quarter of fiscal 1999 and 2000. This information, in the
opinion of management, includes only normal recurring adjustments necessary for
a fair representation of the information set forth therein. The operating
results for any quarter are not indicative of results for any future period.
Quarterly results may not be comparative due to the seasonal nature of
operations.

<TABLE>
<CAPTION>
(IN THOUSANDS)                                         FIRST      SECOND     THIRD      FOURTH
--------------                                        --------   --------   --------   --------
<S>                                                   <C>        <C>        <C>        <C>
Fiscal 1999:
  Revenue(a)........................................  $ 75,749   $ 77,716   $ 88,457   $ 98,381
  Operating income(b)...............................   (10,646)     9,342     18,528     14,742
  Income (loss) before income taxes and
    extraordinary items.............................   (15,470)     2,391     11,859      5,886
  Extraordinary item, net of tax....................      (869)        --         --         --
  Net income (loss).................................   (12,746)     1,455      7,218      3,642

Fiscal 2000:
  Revenue(c)........................................  $109,320   $117,244   $124,979   $110,545
  Operating income..................................    16,383     18,530     23,652      5,094
  Income before income taxes and cumulative effect
    of an accounting change.........................     6,516      9,242     14,057     (4,358)
  Cumulative effect of an accounting change, net of
    tax.............................................    (3,142)        --         --         --
  Net income (loss).................................       605      5,314      8,079     (2,310)
</TABLE>

------------------------

(a) Revenues for the first, second, third and fourth quarters of fiscal 1999
    differ from the amounts originally reported in the Company's Quarterly
    Reports on Form 10-Q and the Company's Annual Report on Form 10-K, due to
    the reclassification of other revenue at Harveys Wagon Wheel.

(b) Operating income for the second and third quarters of fiscal 1999 differs
    from the amounts originally reported in the Company's Quarterly Report on
    Form 10-Q, due to the reclassification of gain (loss) on disposition of
    assets at Harveys Lake Tahoe.

(c) Revenues for the second quarter of fiscal 2000 differ from the amount
    originally reported in the Company's Quarterly Report on Form 10-Q, due to a
    reclassification of other revenue at Harveys Lake Tahoe.

                                       77
<PAGE>
                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
<S>                     <C>
 2.1                    Agreement and Plan of Merger dated as of April 17, 2000 by
                        and among PH Casino Resorts, Inc., Harveys Casino Resorts,
                        and Pinnacle Acquisition Corporation (20)

 2.2                    Agreement and Plan of Merger dated as of April 17, 2000 by
                        and among PH Casino Resorts, Inc., Harveys Casino Resorts,
                        and Harveys Acquisition Corporation (20)

 3.1                    Amendments to Articles of Incorporation of Harveys Casino
                        Resorts as Surviving Constituent Entity (filed as Exhibit A
                        to Articles of Merger of Harveys Acquisition Corporation
                        into Harveys Casino Resorts).(7) (Articles of Incorporation
                        are incorporated herein by reference to Harveys Acquisition
                        Corporations's Registration Statement of Form 10 (File
                        No. 0-25093), filed November 20, 1998).

 3.2                    Ninth Amended and Restated Bylaws of the Registrant(21)

 4.1                    Form of Stock Certificate of the Registrant(10)

 4.2                    Indenture, dated as of May 15, 1996 (the "Original
                        Indenture") by and among the Registrant, Harveys Wagon Wheel
                        Casino Limited Liability Company, Harveys C. C. Management
                        Company, Inc., Harveys Iowa Management Company, Inc. and
                        Harveys L. V. Management Company, Inc. (the "Guarantors")
                        and IBJ Schroder Bank & Trust Company as Trustee (including
                        form of Note)(3)

 4.3                    First Supplemental Indenture, dated as of June 5, 1996,
                        supplementing the Original Indenture(4)

 4.4                    Second Supplemental Indenture, dated as of May 22, 1997,
                        supplementing the Original Indenture(6)

 4.5                    Third Supplemental Indenture, dated as of December 24, 1998,
                        among the Registrant, Harveys Tahoe Management
                        Company, Inc., Harveys C. C. Management Company, Inc.,
                        Harveys Iowa Management Company, Inc., Harveys L. V.
                        Management Company, Inc. and IBJ Schroder Bank and Trust
                        Company, supplementing the Original Indenture(10)

 4.6                    Fourth Supplemental Indenture, dated as of December 24,
                        1998, among the Registrant, Harveys Tahoe Management
                        Company, Inc., Harveys C. C. Management Company, Inc.,
                        Harveys Iowa Management Company, Inc., Harveys L. V.
                        Management Company, Inc. and IBJ Schroder Bank and Trust
                        Company, supplementing the Original Indenture(10)

 4.7                    Fifth Supplemental Indenture, dated as of October 5, 1999
                        among the Registrant, Harveys Tahoe Management
                        Company, Inc., Harveys C. C. Management Company, Inc.,
                        Harveys Iowa Management Company, Inc., Harveys L. V.
                        Management Company, Inc., HBR Realty Company, Inc., Harveys
                        BR Management Company, Inc. and IBJ Whitehall Bank and Trust
                        Company, supplementing the Original Indenture(16)

 4.8                    Certificate of Designation of the 13 1/2% Series A Senior
                        Redeemable Convertible Cumulative Preferred Stock ($0.01 per
                        value per share) and the 13 1/2% Series B Redeemable
                        Convertible Cumulative Preferred Stock ($0.01 par value per
                        share) of Harveys Casino Resorts(7)

 4.9                    Certificate of Amendment, dated as of February 7, 2000, to
                        the Certificate of Designation of the 13 1/2% Series A
                        Senior Redeemable Convertible Cumulative Preferred Stock
                        ($0.01 par value per share) and the 13 1/2% Series B Senior
                        Redeemable Convertible Cumulative Preferred Stock ($0.01 par
                        value per share) of Harveys Casino Resorts(17)

 4.10                   Certificate of Amendment, dated as of October 3, 2000, to
                        the Certificate of Designation of the 13 1/2% Series A
                        Senior Redeemable Convertible Cumulative Preferred Stock
                        ($0.01 par value per share) and the 13 1/2% Series B Senior
                        Redeemable Convertible Cumulative Preferred Stock ($0.01 par
                        value per share) of Harveys Casino Resorts(19)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
<S>                     <C>
 10.1                   Second Amended and Restated Credit Agreement, dated as of
                        October 5, 1999, among Harveys Casino Resorts, a Nevada
                        corporation, Harveys C. C. Management Company, Inc., a
                        Nevada corporation, Harveys Iowa Management Company, Inc., a
                        Nevada corporation, Harveys Tahoe Management Company, Inc.,
                        a Nevada corporation, HBR Realty Company, Inc., a Nevada
                        corporation, Harveys BR Management Company, Inc., a Nevada
                        corporation, HCR Services Company, Inc., a Nevada
                        corporation, as Borrowers, the Lenders herein named, Wells
                        Fargo Bank, National Association, as Swingline Lender, L/C
                        Issuer and Agent Bank, Credit Lyonnais Los Angeles Branch,
                        as Syndication Co-Agent, Deutsche Banc Securities, as
                        Documentation Agent, Societe Generale and Bank One, N. A. as
                        Co-Managing Agents(17)

 10.2                   First Amendment to Second Amended and Restated Credit
                        Agreement, dates as of April 14, 2000 by and among Harveys
                        Casino Resorts, a Nevada corporation, Harveys Tahoe
                        Management Company, Inc., a Nevada corporation, HBR Realty
                        Company, Inc., a Nevada corporation, HCR Services
                        Company, Inc., a Nevada corporation. as Borrowers, the
                        Lenders herein named, Wells Fargo Bank, National Association
                        as Swingline Lender, L/C Issuer and Agent Bank(18)

 10.3                   Net Lease Agreement, dated February 28, 1985, between Park
                        Cattle Co. and the Registrant(1)

 10.4                   Lease, dated July 9, 1973, between Park Cattle Co. and the
                        Registrant(1)

 10.5                   Supplemental Executive Retirement Plan(1)*

 10.6                   Senior Supplemental Executive Retirement Plan(1)*

 10.7                   Honorary Director Resolution--Vera Gross(1)

 10.8                   Form of Indemnification Agreement for Directors and Officers
                        and Schedule of Indemnities(10)

 10.9                   Harveys Casino Resorts Management Incentive Plan, approved
                        August 8, 1995(2)*

 10.10                  Employment Agreement and Agreement and Covenant Not to
                        Compete or Use or Disclose Trade Secrets, each dated as of
                        December 6, 1999, by and between John R. Bellotti and
                        Harveys Casino Resorts(18)*

 10.11                  Amended and Restated Employment Agreement dated as of
                        April 28, 2000, by and between Harveys Casino Resorts and
                        Charles W. Scharer(18)*

 10.12                  Amended and Restated Employment Agreement dated as of
                        April 28, 2000, by and between Harveys Casino Resorts and
                        John J. McLaughlin(18)*

 10.13                  2001 Deferred Compensation Plan Participants(21)

 10.14                  Deferred Compensation Plan, Form of Agreement(5)*

 10.15                  Employment Agreement and Agreement and Covent Not to Compete
                        or Use or Disclose Trade Secrets, each dated as of
                        August 23, 1999 by and between Daniel J. Roy, Jr. and
                        Harveys Casino Resorts(21)*

 10.16                  Employment Agreement and Agreement and Covent Not to Compete
                        or Use or Disclose Trade Secrets, each dated as of July 25,
                        2000 by and between Edward B. Barraco and Harveys Casino
                        Resorts(21)*

 10.17                  Employment Agreement entered into on November 20, 2000 and
                        effective as of December 1, 2000, by and between Harveys
                        Casino Resorts and Wade Hundley(21)*

 10.18                  Separation Agreement made and entered into January 4, 2001
                        by and between Harveys Casino Resorts and Charles W.
                        Scharer(21)*

 10.19                  Deferred Compensation Agreement dated as of February 2, 1999
                        by and between Harveys Casino Resorts and Charles W.
                        Scharer(10)*
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
<S>                     <C>
 10.20                  Employment Agreement and Agreement and Covenant Not to
                        Compete or Use or Disclose Trade Secrets, each dated as of
                        June 30, 2000, by and between Gary Armentrout and Harveys
                        Casino Resorts(19)*

 10.21                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and Gary Armentrout(19)*

 10.22                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and Ed Barraco(19)*

 10.23                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and John R. Bellotti(19)*

 10.24                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and Daniel J. Roy Jr.(19)*

 10.25                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and William Stephens(19)*

 10.26                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and Verne Welch(19)*

 10.27                  Executive Retention Award dated as of May 15, 2000 by and
                        between the Registrant and James J. Rafferty(19)*

 10.28                  Employment Agreement dated as of July 21, 2000 and Agreement
                        and Covenant Not to Compete or Use or Disclose Trade
                        Secrets, dated as of August 29, 2000, each by and between
                        Registrant and James J. Rafferty(19)*

 10.29                  Assignment of Leases, effective June 1, 1997, by and between
                        Harveys Casino Resorts, formerly known as Harvey's Wagon
                        Wheel, Inc., a Nevada corporation, Harveys Tahoe Management
                        Company, Inc., a Nevada corporation, and Park Cattle Co., a
                        Nevada corporation(6)

 10.30                  Third Amendment to Lease Agreement, dated June 1, 1997, by
                        and between Park Cattle Co., a Nevada corporation, and
                        Harveys Casino Resorts, formerly known as Harvey's Wagon
                        Wheel, Inc., a Nevada corporation(6)

 10.31                  First Amendment to Lease Agreement, dated June 1, 1997,
                        between Park Cattle Co., a Nevada corporation, and Harveys
                        Casino Resorts, formerly known as Harveys Wagon
                        Wheel, Inc., a Nevada corporation (Douglas County, Nevada
                        property)(6)

 10.32                  First Amendment to Lease Agreement, dated June 1, 1997,
                        between Park Cattle Co., a Nevada corporation, and Harveys
                        Casino Resorts, formerly known as Harveys Wagon
                        Wheel, Inc., a Nevada corporation (El Dorado County,
                        California property)(6)

 10.33                  Harveys Casino Resorts Change of Control Plan, effective
                        June 1, 1997(9)*

 10.34                  First Amendment to Harveys Casino Resorts Change of Control
                        Plan, dated February 2, 1999(21)*

 10.35                  Supplemental Executive Retirement Plan, effective as of
                        November 20, 1997(9)*

 10.36                  Deferred Compensation Agreement dated as of February 2, 1999
                        by and between Harveys Casino Resorts and John J.
                        McLaughlin(10)*

 10.37                  1999 Omnibus Stock Incentive Plan(10)*

 10.38                  Stockholders Agreement entered into as of February 2, 1999
                        by and among Harveys Casino Resorts (the "Company"), Colony
                        HCR Voteco LLC, Colony Investors III, L. P. And the
                        securityholders of the Company as identified from time to
                        time on Schedule A thereto(10)*

 10.39                  Noncompetition and Trade Secret Agreement dated as of
                        February 1, 1998 by and among Harveys Acquisition
                        Corporation and the individuals signatory thereto(8)*
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
<S>                     <C>
 10.40                  Form of Stock Option and Restricted Stock Agreement dated as
                        of February 2, 1999 by and between Harveys Casino Resorts
                        and Certain Executives(10)*

 10.41                  Schedule of Executives Party to Stock Option and Restricted
                        Stock Agreements dated as of February 2, 1999(21)

 10.42                  Form of Deferred Compensation Agreement dated as of
                        February 2, 1999 by and between Harveys Casino Resorts and
                        Certain Executives(10)*

 10.43                  Schedule of Executives Party to Deferred Compensation
                        Agreements dated as of February 2, 1999(21)

 10.44                  Employment Agreement made and entered into June 14, 1999
                        between Harveys Casino Resorts and William Stephens(11)*

 10.45                  Agreement and Covenant Not to Compete or Use or Disclose
                        Trade Secrets made and entered into on May 7 1999 by and
                        between William Stephens and Harveys Casino Resorts(21)

 10.46                  Stock Option and Restricted Stock Agreement dated as of
                        May 7, 1999 by and between Harveys Casino Resorts and
                        William Stephens(11)*

 10.47                  Deferred Compensation Agreement dated as of May 7, 1999 by
                        and between Harveys Casino Resorts and William Stephens(11)*

 10.48                  Employment Agreement made and entered into on August 17,
                        1999 by and between Harveys Casino Resorts and Verne
                        Welch(12)*

 10.49                  Agreement and Covenant Not to Compete or Use or Disclose
                        Trade Secrets made and entered into on August 17, 1999 by
                        and between Verne Welch and Harveys Casino Resorts(12)*

 10.50                  Stock Option and Restricted Stock Agreement dated as of
                        February 2, 1999 by and between Harveys Casino Resorts and
                        Charles W. Scharer(10)*

 10.51                  Stock Option and Restricted Stock Agreement dated as of
                        February 2, 1999 by and between Harveys Casino Resorts and
                        John J. McLaughlin(10)*

 10.52                  Purchase and Sale Agreement and Joint Escrow Instructions
                        dated August 31, 1999 by and between HBR Realty
                        Company, Inc., a Nevada corporation, and Iowa West Racing
                        Association, Nonprofit Corporation, an Iowa nonprofit
                        corporation(13)

 10.53                  Lease by and between HBR Realty Company, Inc., a Nevada
                        corporation, as Landlord, and Iowa West Racing Association,
                        Nonprofit Corporation, an Iowa nonprofit corporation, as
                        Tenant, dated October 5, 1999(15)

 10.54                  Form of Management Stock Option and Restricted Stock
                        Agreement dated as of May 26, 2000 between Harveys Casino
                        Resorts and Certain Executive Officers(21)

 10.55                  Schedule of Executive Officers Party to the Management Stock
                        Option and Restricted Stock Agreement dated as of May 26,
                        2000(21)

 10.56                  Restricted Stock Agreement dated as of May 26, 2000 by and
                        between Harveys Casino Resorts and John J. McLaughlin(21)

 10.57                  First Amendment to Purchase and Sale Agreement and Joint
                        Escrow Instructions by and between HBR Realty
                        Company, Inc., and Iowa West Racing Association, Nonprofit
                        Corporation, dated October 6, 1999(15)

 10.58                  Amended and Restated Excursion Boat Sponsorship and
                        Operations Agreement by and between Iowa West Racing
                        Association, and Harveys Iowa Management Company, Inc.,
                        dated October 6, 1999(15)

 10.59                  Management Agreement by and between Harveys BR Management
                        Company, Inc., and Iowa West Racing Association dated
                        October 6, 1999(15)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
---------------------   ------------------------------------------------------------
<S>                     <C>
 16.1                   Deloitte & Touche LLP's letter regarding change in
                        certifying accountant(19)

 21.1                   List of Subsidiaries of the Registrant(21)

 27                     Financial Data Schedule (20)
</TABLE>

------------------------

*   Indicates management contract or compensatory arrangement.

(1) Incorporated herein by reference to Registration Statement No. 33-70670

(2) Incorporated herein by reference to Registrant's Annual Report on Form 10-K
    for the period ended November 30, 1995

(3) Incorporated herein by reference to Registration Statement No. 333-3576

(4) Incorporated herein by reference to Registrant's Current Report on Form 8-K
    filed June 14, 1996

(5) Incorporated herein by reference to Registrant's Quarterly Report on
    Form 10-Q for the period ended February 28, 1997

(6) Incorporated herein by reference to Registrant's Quarterly Report on
    Form 10-Q for the period ended August 31, 1997

(7) Incorporated herein by reference to Registrant's Current Report on Form 8-K
    filed February 12, 1999

(8) Incorporated herein by reference to Registration Statement on Form 10 of
    Harveys Acquisition Corporation, File No. 0-25093, filed November 20, 1998

(9) Incorporated herein by reference to the Registrant's Annual Report on
    Form 10-K for the period ended November 30, 1997

(10) Incorporated herein by reference to the Registrant's Annual Report on
    Form 10-K for the period ended November 30, 1998

(11) Incorporated herein by reference to the Registrant's Quarterly Report of
    Form 10-Q for the period ended May 31, 1999.

(12) Incorporated herein by reference to the Registrant's Quarterly Report on
    Form 10-Q for the period ended August 31, 1999.

(13) Incorporated herein by reference to the Registrant's Current Report on
    Form 8-K filed on September 3, 1999.

(14) Incorporated herein by reference to the Registrant's Current Report on
    Form 8-K filed March 18, 1999.

(15) Incorporated herein by reference to the Registrant's Annual Report of
    Form 10-K for the period ended November 30, 1999.

(16) Incorporated herein by reference to the Registrant's Registration Statement
    on Form S-8, filed January 22, 2001.

(17) Incorporated herein by reference to the Registrant's Quarterly Report on
    Form 10-Q for the period ended February 29, 2000.

(18) Incorporated herein by reference to the Registrant's Quarterly Report on
    Form 10-Q for the period ended May 31, 2000.

(19) Incorporated herein by reference to the Registrant's Quarterly Report on
    Form 10-Q for the period ended August 31, 2000.

(20) Incorporated herein by reference to the Registrant's Current Report on
    Form 8-K filed April 27, 2000.

(21) Filed herewith.