<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
[X] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
JCC HOLDING COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and
O-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
[JCC HOLDING COMPANY LOGO]
ONE CANAL PLACE
365 CANAL STREET, SUITE 900
NEW ORLEANS, LOUISIANA 70130
April 19, 2000
Dear Stockholder:
On behalf of the board of directors and management of JCC Holding Company,
I cordially invite you to our annual meeting of stockholders to be held on
Tuesday, May 16, 2000 at 10:00 a.m. central time at the Harrah's New Orleans
Casino in the Mansion Ballroom, 4 Canal Street, New Orleans, Louisiana, 70130.
At the annual meeting, stockholders will be asked to (a) elect two
directors for a three year term and (b) ratify the appointment of independent
accountants. These matters are described in the accompanying notice of annual
meeting and proxy statement.
It is important that your stock be represented at the meeting regardless of
the number of shares you hold. You are encouraged to specify your voting
preferences by so marking the enclosed proxy card. Please then sign and date the
proxy card and return it in the enclosed envelope whether or not you plan to
attend the meeting. If you do attend and wish to vote in person, you may revoke
your proxy at the meeting.
If you plan to attend the meeting, please check the card in the space
provided. This will assist us with meeting preparations and will enable us to
expedite your admittance. If your shares are not registered in your own name and
you would like to attend the meeting, please ask the broker, trust, bank or
other nominee that holds the shares to provide you with evidence of your share
ownership, which will enable you to gain admission to the meeting.
Sincerely,
/s/ Frederick W. Burford
Frederick W. Burford
President and Chief Executive
Officer
<PAGE> 3
JCC HOLDING COMPANY
ONE CANAL PLACE
365 CANAL STREET, SUITE 900
NEW ORLEANS, LOUISIANA 70130
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 16, 2000
---------------------
NOTICE HEREBY IS GIVEN that the 2000 annual meeting of stockholders of JCC
Holding Company will be held at the Harrah's New Orleans Casino in the Mansion
Ballroom, 4 Canal Street, New Orleans, Louisiana, 70130, on Tuesday, May 16,
2000 at 10:00 a.m. central time for the purposes of:
1. Electing two directors to serve until the 2003 annual meeting of
stockholders;
2. Ratifying the appointment of Deloitte & Touche LLP as our
independent accountants for the fiscal year ending December 31, 2000; and
3. Transacting such other business as properly may come before the
annual meeting or any adjournments thereof.
Information relating to the foregoing matters is set forth in the attached
proxy statement. Stockholders of record at the close of business on Thursday,
March 23, 2000 are entitled to receive notice of and to vote at the annual
meeting and any adjournments.
By Order of the Board of Directors.
/s/ L. CAMILLE FOWLER
L. Camille Fowler
Vice President -- Finance,
Treasurer and Secretary
New Orleans, Louisiana
April 19, 2000
PLEASE READ THE ATTACHED PROXY STATEMENT AND PROMPTLY COMPLETE, EXECUTE AND
RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING POSTAGE-PAID ENVELOPE. YOU
CAN SPARE YOUR COMPANY THE EXPENSE OF FURTHER PROXY SOLICITATION BY RETURNING
YOUR PROXY CARD PROMPTLY. IF YOU ATTEND THE ANNUAL MEETING, YOU MAY REVOKE THE
PROXY AND VOTE IN PERSON IF YOU SO DESIRE.
<PAGE> 4
JCC HOLDING COMPANY
---------------------
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 16, 2000
The board of directors of JCC Holding Company, a Delaware corporation, is
furnishing this proxy statement to solicit your proxy for the voting of your
shares at our 2000 annual meeting of stockholders and at any adjournments. The
annual meeting will be held on Tuesday, May 16, 2000 at 10:00 a.m. central time
at the Harrah's New Orleans Casino in the Mansion Ballroom, 4 Canal Street, New
Orleans, Louisiana, 70130.
We are mailing this proxy statement and the accompanying proxy card to
stockholders on or about April 19, 2000.
VOTING
GENERAL
Our authorized capital stock consists of class A common stock, par value
$.01 per share, class B common stock, par value $.01 per share, and unclassified
common stock, par value $.01 per share. Prior to the transition date (as defined
below), we may not issue shares of unclassified common stock, and on and after
the transition date, we may not issue shares of class A or class B common stock.
Each share of class A and class B common stock outstanding on the transition
date will automatically convert into one share of unclassified common stock. The
term "transition date" means the date upon which the earliest of the following
events occurs: (1) October 28, 2002, (2) the end of two consecutive 12-month
periods in each of which contingent payments under the senior subordinated notes
due 2009 with contingent payments and senior subordinated contingent notes due
2009 issued by Jazz Casino Company, L.L.C., our wholly-owned subsidiary, equals
or exceeds $15 million and (3) the end of a 30-day period during which the
average daily closing minimum market value (as defined below) equals or exceeds
$435 million (as adjusted to account for class A or class B common stock that we
purchase or additional shares of class A or class B common stock that we issue).
The term "minimum market value" means, for any trading day, the sum of (a) the
closing price of our class A common stock multiplied by the number of shares of
class A common stock that we issued on October 30, 1998 to holders of Harrah's
Jazz Company's, a Louisiana general partnership and the predecessor to our
operations, and Harrah's Jazz Finance Corp.'s 14 1/4% first mortgage notes due
2001 with contingent interest pursuant to the third amended joint plan of
reorganization under Chapter 11 of Title 11 of the United States Bankruptcy
Code, as modified through October 13, 1998, of Harrah's Jazz Company, Harrah's
Jazz Finance Corp. and Harrah's New Orleans Investment Company, an indirect
wholly-owned subsidiary of Harrah's Entertainment, Inc. and (b) the closing
price for $1,000 of Jazz Casino Company's senior subordinated notes with
contingent payments and its senior subordinated contingent notes divided by
$1,000, and then multiplied by the aggregate principal amount outstanding of
these notes.
SECURITIES THAT CAN BE VOTED AT THE ANNUAL MEETING
The securities that can be voted at the annual meeting consist of the class
A common stock and class B common stock. Except in the election of directors,
holders of class A and class B common stock are entitled to cast one vote for
each share held on the record date on each matter submitted to the stockholders
at the annual meeting. In the election of directors, (1) holders of class A
common stock are entitled to cast one vote for each share of class A common
stock held on the record date for any person chosen to stand for election by the
Class A director nomination committee of the board of directors or nominated by
the holder in accordance with our Bylaws and (2) holders of class B common stock
are entitled to cast one vote for each share of class B common stock held on the
record date for any person chosen to stand for election by the Class B
1
<PAGE> 5
director nomination committee of the board of directors or nominated by the
holder in accordance with our Bylaws.
The record date for determining stockholders who are entitled to receive
notice of, and to vote at, the annual meeting has been fixed by the board of
directors as the close of business on March 23, 2000. On the record date,
5,638,314 shares of class A common stock held of record by 430 stockholders and
4,452,623 shares of class B common stock held of record by two stockholders were
outstanding and eligible to be voted at the annual meeting. Harrah's Crescent
City Investment Company, a wholly-owned subsidiary of Harrah's Entertainment,
was the record holder of approximately 96.6% of the issued and outstanding
shares of class B common stock, or approximately 42.6% of the issued and
outstanding shares of class A and class B common stock, on the record date.
QUORUM AND VOTE REQUIRED
At the annual meeting, the presence, in person or by proxy, of (1) the
holders of a majority of the issued and outstanding shares of class A common
stock entitled to vote thereat and (2) the holders of a majority of the issued
and outstanding shares of class B common stock entitled to vote thereat, will
constitute a quorum for the transaction of business. Abstentions, votes withheld
from any nominee, and broker non-votes will be counted as present for purposes
of determining the presence or absence of a quorum at the annual meeting. Broker
non-votes are votes that brokers holding shares of record for their customers
are not permitted to cast under applicable stock exchange rules because the
brokers have not received specific instructions from their customers as to
certain proposals and as to which the brokers have advised us that they lack
voting authority.
The following stockholder votes will be required to approve the two
proposals to be submitted by us at the annual meeting.
- With regard to the proposal to elect two directors to serve until the
2003 annual meeting of stockholders (Proposal 1), (a) the Class A
director nominee must be elected by the affirmative vote of a plurality
of the issued and outstanding shares of class A common stock present in
person or by proxy at the annual meeting and entitled to vote in such
election and (b) the Class B director nominee must be elected by the
affirmative vote of a plurality of the issued and outstanding shares of
class B common stock present in person or by proxy at the annual meeting
and entitled to vote in such election. As a result, shares that are
withheld from voting as to any nominee will have the same effect as a
vote against the nominee, but broker non-votes will have no effect.
- The proposal to ratify the appointment of independent accountants
(Proposal 2) must be approved by the holders of a majority of the shares
of class A and class B common stock present in person or by proxy at the
annual meeting and entitled to vote thereat. As a result, abstentions
will have the same effect as a vote against the proposal, but broker
non-votes will have no effect.
PROXIES; OTHER MATTERS THAT MAY COME BEFORE THE ANNUAL MEETING
You may use the accompanying proxy card if you are unable to attend the
annual meeting in person or are able to attend but do not wish to vote in
person. You should specify your choices with regard to each proposal on the
enclosed proxy card. All properly executed and dated proxy cards delivered by
stockholders to us in time to be voted at the annual meeting and not revoked
will be voted at the annual meeting in accordance with the instructions given.
If you do not give specific instructions on your proxy card, the shares
represented by a signed and dated proxy card will be voted "FOR" the election of
the two director nominees named in Proposal 1 and "FOR" Proposal 2.
The board of directors is not aware of any other business to be presented
to a vote of the stockholders at the annual meeting. As permitted by Rule
14a-4(c) of the SEC, the persons named as proxies on the proxy cards will have
discretionary authority to vote in their judgment on any proposals presented by
stockholders for consideration at the annual meeting that are submitted to us
after March 1, 2000. Such proxies also will have discretionary authority to vote
in their judgment upon the election of any person selected in accordance with
our Restated Certificate of Incorporation as a director nominee in place of a
nominee named in Proposal 1
2
<PAGE> 6
who is unable to serve or for good cause will not serve as a director, and upon
matters incident to the conduct of the annual meeting.
Your giving a proxy does not affect your right to vote in person should you
attend the annual meeting. However, the only way to revoke a proxy is by the
following methods:
- giving written notice of revocation to JCC Holding Company, One Canal
Place, 365 Canal Street, Suite 900, New Orleans, Louisiana 70130,
Attention: L. Camille Fowler, Vice President -- Finance, Treasurer and
Secretary;
- by executing and delivering a proxy card bearing a later date to Ms.
Fowler; or
- by voting in person at the annual meeting.
If you will not be attending the annual meeting, you should return your proxy or
notice in time for receipt no later than the close of business on the day
preceding the annual meeting.
We are soliciting your proxy on behalf of the board of directors, and we
will bear all related costs. In addition to soliciting proxies directly, we have
requested brokerage firms, nominees, custodians and fiduciaries to forward proxy
materials to the beneficial owners of shares held of record by them. We also may
solicit proxies through our directors, officers and employees in person and by
telephone and facsimile, but we will not pay them any additional compensation
for doing this.
STOCK OWNERSHIP
The following table sets forth certain information as of February 1, 2000
(unless otherwise indicated) regarding the beneficial ownership of our class A
and class B common stock by (a) each person who is known by us to own more than
5% of either the class A or class B common stock, (b) each director and nominee
for director, (c) each executive officer named in the Summary Compensation Table
and (d) all directors and executive officers as a group. As of February 1, 2000,
there were 5,638,314 shares of class A common stock and 4,452,623 shares of
class B common stock outstanding.
Pursuant to the rules of the SEC, the number of shares of class A and class
B common stock beneficially owned by a specified person or group includes shares
issuable pursuant to convertible securities, warrants and options held by the
person or group that may be converted or exercised within 60 days after February
1, 2000. These shares are deemed to be outstanding for the purpose of computing
the percentage of the class beneficially owned by the person or group but are
not deemed to be outstanding for the purpose of computing the percentage of the
class beneficially owned by any other person or group.
3
<PAGE> 7
The persons named in the table gave us the stock ownership information
about themselves. Except as explained in the footnotes below, the named persons
have sole voting and investment power with regard to the shares shown as
beneficially owned by them.
<TABLE>
<CAPTION>
CLASS A COMMON STOCK CLASS B COMMON STOCK
-------------------------- --------------------------
SHARES SHARES
NAME AND ADDRESS BENEFICIALLY PERCENT OF BENEFICIALLY PERCENT OF
OF BENEFICIAL OWNER OWNED CLASS OWNED OWNED CLASS OWNED
- ------------------- ------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
Harrah's Entertainment, Inc.(1)................ -- -- 4,302,623 96.6%
Merrill Lynch & Co., Inc.(2)................... 1,042,654 18.5% -- --
Merrill Lynch Corporate Bond Fund, Inc.(3)..... 732,105 13.0% -- --
David M. Knott(4).............................. 309,200 5.5% -- --
Colin V. Reed.................................. -- -- -- --
Seth E. Lemler(5).............................. 5,000 * -- --
Eddie N. Williams(5)........................... 12,000 * -- --
Edwin Jacobson(5).............................. 5,000 * -- --
Philip G. Satre(6)............................. -- -- -- --
Rudy J. Cerone(5).............................. 5,000 * -- --
Frederick W. Burford(7)(8)..................... 147,000 2.6% -- --
L. Camille Fowler(7)(9)........................ 40,200 * -- --
Fred J. Keeton(7)(10).......................... 24,200 * -- --
Thomas M. Morgan............................... -- -- -- --
All directors and executive officers as a group
(ten persons)(11)............................ 238,400 4.2% -- --
</TABLE>
- ---------------
* Represents less than 1.0%.
(1) Shares are held of record by Harrah's Entertainment's indirect wholly-owned
subsidiary, Harrah's Crescent City Investment Company. Does not include
shares of unclassified common stock issuable upon the exercise of a warrant
held by Harrah's Crescent City Investment Company. For a description of
this warrant, refer to "Certain Relationship and Related Transactions." The
address of Harrah's Entertainment and Harrah's Crescent City Investment
Company is 5100 West Sahara Boulevard, Suite 200, Las Vegas, Nevada 89140.
(2) According to Schedule 13G dated February 1, 2000. Merrill Lynch & Co.,
Inc., a parent holding company, holds shares of class A common stock
through its indirectly-owned asset management subsidiaries, Merrill Lynch
Asset Management, L.P. and Fund Asset Management, L.P. Merrill Lynch Asset
Management, L.P. and Fund Asset Management, L.P. are investment advisers
registered under Section 203 of the Investment Advisors Act of 1940, and
act as investment advisors for certain investment companies registered
under Section 8 of the Investment Company Act of 1940. Merrill Lynch & Co.,
Inc., through Merrill Lynch Asset Management, L.P. and Fund Asset
Management, L.P., shares voting and dispositive power, and disclaims
beneficial ownership, with respect to all of the shares of class A common
stock presented. The address of Merrill Lynch & Co., Inc. is World
Financial Center, North Tower, 250 Vesey Street, New York, New York 10381.
(3) According to Schedule 13G dated February 1, 2000. Merrill Lynch Corporate
Bond Fund, Inc. shares voting and dispositive power, and disclaims
beneficial ownership, with respect to all of the shares of class A common
stock presented. The address of Merrill Lynch Corporate Bond Fund, Inc. is
800 Scudders Mill Road, Plainsboro, New Jersey 08536.
(4) According to Schedule 13G dated February 10, 2000. The address of David M.
Knott is 485 Underhill Boulevard, Suite 205, Syosset, New York 11791.
(5) Includes 5,000 shares issuable upon the exercise of presently exercisable
outstanding stock options.
(6) Mr. Satre was elected as a Class B director on March 2, 2000.
4
<PAGE> 8
(7) Includes shares of restricted class A common stock issued on April 29,
1999, for which the officer has voting rights but does not have the right
to dispose of the stock until we satisfy certain performance goals. For a
description of these performance goals, refer to footnote 2 in the Summary
Compensation Table included under the heading "Executive Compensation." As
of March 2, 2000, the restrictions on the following number of each
officers' shares of class A common stock terminated:
- 18,150 shares for Mr. Burford
- 4,950 shares for Ms. Fowler
- 2,970 shares for Mr. Keeton
(8) Includes 92,000 shares issuable upon the exercise of presently exercisable
outstanding stock options.
(9) Includes 25,200 shares issuable upon the exercise of presently exercisable
outstanding stock options.
(10) Includes 15,200 shares issuable upon the exercise of presently exercisable
outstanding stock options.
(11) Includes 152,400 shares issuable upon the exercise of presently exercisable
outstanding stock options.
PROPOSAL 1
ELECTION OF DIRECTORS
NOMINEES
Our Restated Certificate of Incorporation provides that, prior to the
transition date, the maximum number of our authorized directors is six, three of
which are to be elected by the holders of the class A common stock, designated
as Class A directors, and three of which are to be elected by the holders of the
class B common stock, designated as Class B directors. Currently, the board is
comprised of three Class A directors and three Class B directors.
Notwithstanding, upon the occurrence of an extraordinary flip event (as that
term is defined in our Restated Certificate of Incorporation), a majority of
Class A directors then in office will elect an additional Class A director whose
term will immediately expire if the extraordinary flip event is cured in
accordance with our Restated Certificate of Incorporation. We expect that such
additional Class A director will be Timothy E. Kelly, who we refer to as the
"alternate." In addition, upon the acquisition by a conflicted entity (as that
term is defined in our Restated Certificate of Incorporation) of at least 20% of
the outstanding shares of class A common stock, a majority of Class B directors
then in office will elect an additional Class B director, unless an
extraordinary flip event has occurred and not been cured at such time. However,
the term of this additional Class B director will immediately expire if (1) an
extraordinary flip event occurs after this acquisition of 20% or more of our
class A common stock leading to the additional Class B director's election or
(2) the number of shares of class A common stock held by the conflicted entity
is reduced so that the conflicted entity owns less than 20% of the outstanding
shares of class A common stock.
The board of directors is divided into three groups, designated as Group I,
Group II and Group III. Each group consists of one Class A director and one
Class B director. The directors in each group are elected for a term of three
years and until their successors are elected and qualified. The term of office
of one of the groups of directors expires each year at our annual meeting of
stockholders, and a new group of directors is elected by the stockholders each
year at that time.
In connection with the consummation of the third amended plan of
reorganization of Harrah's Jazz Company, Harrah's Jazz Finance Corp. and
Harrah's New Orleans Investment Company, Seth E. Lemler and Colin V. Reed were
designated as the initial Group I directors, with Mr. Lemler serving as a Class
A director and Mr. Reed serving as a Class B director. Thereafter, the other
individuals identified as Group II and Group III directors below were elected by
the board to serve as directors. Messrs. Lemler and Reed were re-elected by the
stockholders at our 1999 annual meeting of stockholders. Pursuant to the terms
of the third amended plan of reorganization, Seth E. Lemler, Edwin Jacobson and
Rudy J. Cerone, each a Class A director, were nominated to serve on the board by
a committee which represented the holders of the formerly outstanding 14 1/4%
first mortgage notes issued by Harrah's Jazz Company and Harrah's Jazz Finance
Corp.
5
<PAGE> 9
At the annual meeting, the terms of the two Group II directors, Messrs.
Williams and Jacobson, will expire. Mr. Jacobson has been designated as the
Class A director nominee by the Class A director nomination committee of the
board and will thus stand for re-election as a Class A director at the annual
meeting. Mr. Williams has been designated as the Class B director nominee by the
Class B director nomination committee of the board and will thus stand for
re-election as a Class B director at the annual meeting. If elected by the
stockholders, each of the nominees will serve a three-year term that will expire
at the 2003 annual meeting of stockholders. If either of the nominees should be
unavailable to serve for any reason (which we do not anticipate), then the Class
A director nomination committee, in the case of Mr. Jacobson, or the Class B
nomination committee, in the case of Mr. Williams, may designate a substitute
nominee in accordance with our Restated Certificate of Incorporation (in which
case the persons named as proxies on the enclosed proxy card will vote the
shares represented by all valid proxy cards for the election of this substitute
nominee) or the Class A director nomination committee or the Class B nomination
committee, as the case may be, may allow the vacancy or vacancies to remain open
until a suitable candidate or candidates are located and nominated.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT (1) HOLDERS OF CLASS A
COMMON STOCK VOTE "FOR" THE PROPOSAL TO RE-ELECT EDWIN JACOBSON AS A CLASS A
DIRECTOR AND (2) HOLDERS OF CLASS B COMMON STOCK VOTE "FOR" THE PROPOSAL TO
RE-ELECT EDDIE N. WILLIAMS AS A CLASS B DIRECTOR, IN EACH CASE FOR A THREE-YEAR
TERM EXPIRING AT THE 2003 ANNUAL MEETING OF STOCKHOLDERS AND UNTIL HIS SUCCESSOR
HAS BEEN DULY ELECTED AND QUALIFIED.
INFORMATION REGARDING NOMINEES AND CONTINUING DIRECTORS
The following table sets forth certain information regarding the two
nominees for director and the four incumbent directors whose terms as directors
will continue following the annual meeting.
<TABLE>
<S> <C>
GROUP II DIRECTORS NOMINATED TO SERVE UNTIL THE 2003 ANNUAL MEETING OF STOCKHOLDERS
Eddie N. Williams.................... Mr. Williams, age 67, has been a Class B director since
March 4, 1999. Mr. Williams has served as President, Chief
Executive Officer and Director of the Joint Center for
Political and Economic Studies, a national non-profit
research institution, since July 1972. Mr. Williams also
serves as a director of each of Harrah's Entertainment,
Riggs National Corporation, Riggs National Bank and
CareFirst, Inc. (formerly Blue Cross/Blue Shield). Mr.
Williams was a member of the executive committee of Harrah's
Jazz Company and a director of Harrah's Jazz Finance Corp.
from January 1995 to October 1998, both of which filed
petitions under Chapter 11 of the United States Bankruptcy
Code in November 1995.
Edwin Jacobson....................... Mr. Jacobson, age 70, has been a Class A director since
March 4, 1999. Since September 1990, Mr. Jacobson has served
as the President and Chief Executive Officer of Heartland
Partners LP, a limited partnership organized to engage in
the ownership, development, leasing and sale of real estate,
and as a director and the President and Chief Executive
Officer of Heartland Technology, Inc., an electronics
manufacturer primarily for the computer and computer printer
industries.
</TABLE>
6
<PAGE> 10
<TABLE>
<S> <C>
GROUP I DIRECTORS TO SERVE UNTIL THE 2002 ANNUAL MEETING OF STOCKHOLDERS
Colin V. Reed........................ Mr. Reed, age 52, has been a Class B director and Chairman
of the board of directors since April 1998. Mr. Reed has
also been a member of Harrah's Entertainment's
three-Executive Office of the President since May 1999, a
director of Harrah's Entertainment since December 1998, and
Chief Financial Officer of Harrah's Entertainment since
April 1997. He was Executive Vice President of Harrah's
Entertainment from September 1995 to May 1999, and has
served in several other management positions with Harrah's
Entertainment since 1987. Mr. Reed was a member of the
executive committee of Harrah's Jazz Company and a director,
Senior Vice President and Secretary of Harrah's Jazz Finance
Corp., both of which filed petitions under Chapter 11 of the
United States Bankruptcy Code in November 1995. He was also
a director and Senior Vice President of Harrah's New Orleans
Investment Company, which filed a petition under Chapter 11
of the United States Bankruptcy Code in December 1995. In
addition, he was Executive Vice President of Harrah's New
Orleans Management Company, an indirect wholly owned
subsidiary of Harrah's Entertainment from May 1996 to May
1997 Mr. Reed served as our Chief Executive Officer and
President from August 1996 to April 1998 and as President of
our subsidiary, Jazz Casino Company, from May 1997 to March
1998. Mr. Reed is also a director of National Airlines, Inc.
Seth E. Lemler....................... Mr. Lemler, age 41, has been a Class A director since
October 1998. Mr. Lemler has served as a Managing Director
in the Investment Banking Department of Ladenburg Thalmann &
Co. Inc. since May 1996. Prior to joining Ladenburg Thalmann
& Co. Inc., Mr. Lemler served as a consultant at New Valley
Corporation from January 1996 to May 1996. From February
1987 to December 1995, Mr. Lemler served in various
capacities with Deloitte & Touche LLP, including, most
recently, as a senior manager in the Reorganization Advisory
Services Consulting Group.
GROUP III DIRECTORS TO SERVE UNTIL THE 2001 ANNUAL MEETING OF STOCKHOLDERS
Philip G. Satre...................... Mr. Satre, age 50 , has been a Class B director since March
2, 2000. Mr. Satre has been Chairman of the Board of
Harrah's Entertainment since January 1997, Chief Executive
Officer since April 1994, and President since April 1991. He
was President of the Harrah's Entertainment's Gaming Group
from 1984 to August 1995, and has been a director of
Harrah's Entertainment since November 1989. He is the
Chairman of the executive committee of the Harrah's
Entertainment board of directors. He has been Chairman and
Chief Executive Officer of Harrah's New Orleans Management
Company since August 1993. Mr. Satre is also a director of
JDN Realty Corporation and TABCORP Holdings Limited, an
Australian public company (pending regulatory approval). He
was Chairman of the executive committee of Harrah's Jazz
Company and a director and President of Harrah's Jazz
Finance Corp., both of which filed petitions under Chapter
11 of the United States Bankruptcy Code in November 1995.
Rudy J. Cerone....................... Mr. Cerone, age 46, has been a Class A director since March
4, 1999. Since December 1987, Mr. Cerone has been a partner
in McGlinchey Stafford, PLLC, a law firm located in New
Orleans, Louisiana.
</TABLE>
7
<PAGE> 11
Effective March 2, 2000, Mr. John M. Boushy, formerly a Class B, Group III
director, resigned from our board of directors. We recognize Mr. Boushy's
exceptional service on our board of directors and commend him for his laudable
efforts to continually advance our performance. Effective March 2, 2000, Mr.
Philip G. Satre replaced Mr. Boushy as a Class B, Group III director to serve
until the 2001 annual meeting of stockholders.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The board of directors conducts its business through meetings of the full
board and through committees of the board. Prior to the transition date, our
Bylaws require us to maintain the following committees: the audit committee,
gaming committee, compensation committee, Class A director nomination committee,
Class B director nomination committee and capital committee. In addition, we may
form or maintain additional committees upon the affirmative vote of (1) a
majority of the Class A directors then in office and (2) a majority of the Class
B directors then in office. Pursuant to this authority, the board of directors
has established a counsel retention committee. During the fiscal year ended
December 31, 1999, the board of directors held four meetings, and each director
who was serving on the board at the time of such meetings attended at least 75%
of all meetings of the full board of directors. The alternate Class A director
generally attends board meetings as an observer, but does not vote with the
board. The audit committee held four meetings during fiscal 1999, the
compensation committee held three meetings during fiscal 1999, and each of the
gaming committee, compensation committee, Class A director nomination committee,
Class B director nomination committee and capital committee held one meeting
during fiscal 1999. The counsel retention committee did not meet during fiscal
1999.
Audit Committee. The audit committee consists of the Class A directors and
is empowered to undertake and complete an audit or investigation, at any time,
into our business affairs. The audit committee is comprised of Edwin Jacobson
(Chairman), Seth E. Lemler and Rudy J. Cerone.
Gaming Committee. The gaming committee supervises our day-to-day activities
and, except with respect to certain significant transactions (as set out in our
Restated Certificate of Incorporation), has and may exercise, in such manner as
it deems to be in our best interests, all of the powers of the board of
directors in the management or direction of our business and affairs, not
inconsistent, however, with any specific direction as to the conduct of our
business and affairs as the board of directors may give. The gaming committee
consists of two Class B directors (or, if there is only one Class B director,
such director); provided, however, that upon the occurrence of a flip event (as
that term is defined in our Restated Certificate of Incorporation), the Class B
directors will be replaced on the gaming committee by two Class A directors (or,
if there is only one Class A director at such time, such director). The gaming
committee is comprised of Philip G. Satre (Chairman) and Colin V. Reed.
Compensation Committee. The compensation committee consists of the Class A
directors and is empowered to act on our behalf in all matters regarding the
compensation of officers and directors. The compensation committee is comprised
of Seth E. Lemler (Chairman), Edwin Jacobson and Rudy J. Cerone.
Nomination Committees. The Class A director nomination committee consists
of the Class A directors whose terms do not expire at the next annual meeting of
stockholders. It selects the person(s) to stand for election as Class A
directors at each meeting of stockholders, and is comprised of Rudy J. Cerone
and Seth E. Lemler. The Class B director nomination committee consists of the
Class B directors whose terms do not expire at the next annual meeting of
stockholders. It selects the person(s) to stand for election as Class B
directors at each meeting of stockholders, and is comprised of Philip G. Satre
and Colin V. Reed. The board of directors will also consider nominees
recommended by stockholders. For a description of the requirements for
stockholder nominations and other proposals, see "Voting -- Proxies; Other
Matters That May Come Before the Annual Meeting" and "Stockholders' Proposals
for 2001 Annual Meeting."
Capital Committee. The capital committee consists of one Class A director
and one Class B director. After the date on which the completion guarantees (as
that term is defined below) have been terminated, the capital committee is
empowered to act on our behalf with respect to all changes to our capital budget
and the capital budget of our subsidiary, Jazz Casino Company, between $250,000
and $2 million. The term
8
<PAGE> 12
"completion guarantees" means (1) the Notes Completion Guarantee dated as of
October 30, 1998 by Harrah's Operating Company, Inc. and Harrah's Entertainment
to Norwest Bank Minnesota, National Association, as trustee, (2) the Bank
Completion Guarantee dated as of October 29, 1998 by Harrah's Operating Company
and Harrah's Entertainment to Bankers Trust Company, as administrative agent for
the lenders under our bank credit agreement, (3) the LGCB Completion Guarantee
dated as of October 30, 1998 by Harrah's Operating Company and Harrah's
Entertainment to the State of Louisiana and the Louisiana Gaming Control Board
and (4) the RDC/City of New Orleans Completion Guarantee dated as of October 29,
1998 by Harrah's Operating Company and Harrah's Entertainment to the Rivergate
Development Corporation and the City of New Orleans. The capital committee is
comprised of Seth E. Lemler (Chairman) and Philip G. Satre.
Counsel Retention Committee. The counsel retention committee consists of
one Class A director and one Class B director and is empowered to approve our
selection of legal counsel in connection with any matters, transaction or
transactions with our affiliates that were not approved by us prior to or on
October 30, 1998, and otherwise to consider any issues relating to retaining
legal counsel that the counsel retention committee deems appropriate. The
counsel retention committee is comprised of Colin V. Reed and Seth E. Lemler.
DIRECTOR COMPENSATION
Our directors receive an annual retainer of $40,000, a fee of $2,000 for
each board meeting attended by the director and a fee of $1,000 for each meeting
of any committee of the board attended by the director. We also pay these fees
for each board meeting attended by the Class A director alternate. Each director
also receives reasonable out-of-pocket expenses for attending board and
committee meetings. In addition, we pay similar expenses of the Class A director
alternate. In addition, under our Non-Employee Director Stock Option Plan, each
non-employee director is granted (1) an option to purchase 5,000 shares of class
A common stock or, after the transition date, unclassified common stock, on the
later of May 13, 1999, the date our stockholders approved the director stock
option plan, or the date that the person first becomes a non-employee director
and (2) an option to purchase 5,000 shares of class A common stock (a) as of the
date following the first annual meeting of stockholders that occurs more than
one year after the person first becomes a non-employee director and (b) on the
day following each subsequent annual meeting of stockholders, if the person is
serving as a non-employee director as of that date. Pursuant to our Bylaws,
directors who are employees of Harrah's Entertainment or certain affiliates of
Harrah's Entertainment (including Messrs. Reed and Satre), receive no directors'
fees or stock options.
9
<PAGE> 13
EXECUTIVE COMPENSATION
SUMMARY OF COMPENSATION
The following table sets forth the compensation paid or accrued in each of
the fiscal years ended December 30, 1998 and 1999 to Frederick W. Burford, our
President and Chief Executive Officer and each of our other executive officers
who served as an executive officer at December 31, 1999 and whose annual
compensation and bonus was $100,000 or more during fiscal 1999. We refer to
these four executive officers as the "named executive officers."
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------- ------------------------
OTHER
ANNUAL RESTRICTED SECURITIES ALL OTHER
COMPENSATION STOCK UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($) AWARD(S)($) OPTIONS(#) ($)
- --------------------------- ---- --------- -------- ------------ ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Frederick W. Burford................ 1999 $260,000 130,000 $323,125(1) 115,000 $6,866(2)
President and Chief Executive
Officer 1998 39,000(3) 95,335 -- -- -- 44(4)
L. Camille Fowler(5)................ 1999 145,000 50,750 88,125(1) 31,500 8,966(6)
Vice President -- Finance, 1998 21,750 30,000 -- -- -- 669(7)
Treasurer and Secretary
Fred J. Keeton(8)................... 1999 64,904 79,092 22,847(9) 52,875(1) 19,000 266(4)
Vice President -- Government 1998 -- -- -- -- -- 44(4)
Affairs and Community Relations
Thomas M. Morgan(10)................ 1999 -- -- 25,665(11) -- -- --
Vice President -- Development
</TABLE>
- ---------------
(1) On April 29, 1999, we issued the following number of shares of restricted
class A common stock to the following named executive officers: 55,000
shares to Mr. Burford, 15,000 shares to Ms. Fowler and 9,000 shares to Mr.
Keeton. The amounts in the table above represent the fair value of the
awards on the grant date. The officers can vote the stock and are eligible
for any dividends paid on the stock but may not dispose of the shares until
January 1, 2003, or earlier with respect to the following percentages of
the shares upon our obtaining the following performance goals: (a) 33% of
the shares upon the board of director's determination that our casino and
its parking garage construction were completed by October 30, 1999 within
budget; (b) 33% of the shares upon the board of director's determination
that by November, 2000 (i) the master plan for the initial build-out and
leasing of the second floor of our casino for non-gaming uses has been
approved by us, as well as by the State of Louisiana and the City of New
Orleans and (ii) certain minimum non-gaming entertainment activities are
available on the second floor of the casino; and (c) 34% of the shares upon
the board of directors' determination that construction and leasing of the
facilities to be built on our real property located on Fulton and Poydras
Streets in the City of New Orleans has been substantially completed by
November, 2001. As of March 2, 2000, 33% of each officer's shares of
restricted stock vested and the restrictions thereon terminated. As of
December 31, 1999, the value of the restricted stock awards were as
follows: $154,688 for Mr. Burford, $42,188 for Ms. Fowler and $25,313 for
Mr. Keeton.
(2) Consists of $6,600 of matching contributions made by us to our 401(k) plan
based on a percentage of Mr. Burford's contributions to the 401(k) plan and
$266 of insurance premiums paid by us for term life insurance for the
benefit of Mr. Burford.
(3) In connection with the consummation of the transactions contemplated by the
plan of reorganization of Harrah's Jazz Company, Harrah's Jazz Finance
Corp. and Harrah's New Orleans Investment Company, Mr. Burford served as a
paid consultant to Harrah's Entertainment from March 1998 until October
1998. The compensation presented excludes $229,047 paid in 1998 by Jazz
Casino Company, our wholly-owned subsidiary, to Harrah's Operating Company
to reimburse Harrah's Operating
10
<PAGE> 14
Company for amounts paid to Mr. Burford for his services as a consultant in
connection with the reorganization process.
(4) Consists of insurance premiums paid by us for term life insurance for the
benefit of the named executive officer.
(5) Ms. Fowler served as the Director of Finance, Vice President, Secretary and
Treasurer of Harrah's New Orleans Management Company until November 1998,
when she was elected as our Vice President -- Finance, Treasurer and
Secretary.
(6) Consists of $8,700 of matching contributions made by us to our 401(k) plan
based on a percentage of Ms. Fowler's contributions to the 401(k) plan and
$266 of insurance premiums paid by us for term life insurance for the
benefit of Ms. Fowler.
(7) Consists of matching contributions made by us to our 401(k) plan based on a
percentage of Ms. Fowler's contributions to the 401(k) plan.
(8) Mr. Keeton joined us in September 1998 as an officer that we leased from
Harrah's Operating Company. From September 1998 to July 1, 1999, Mr. Keeton
was employed by Harrah's Operating Company, from which we leased Mr.
Keeton. The compensation presented excludes amounts that Jazz Casino
Company paid Harrah's Operating Company to reimburse it for amounts paid to
Mr. Keeton. For a description of this leasing arrangement, refer to
"Certain Relationships and Related Transactions."
(9) Includes $19,839 of rent for an apartment in New Orleans, Louisiana.
(10) Mr. Morgan joined us in January 1999 when he began serving in the capacity
of an officer that we leased from Harrah's Operating Company. From January
1999 to January 2000, Mr. Morgan was employed by Harrah's Operating
Company, from which we leased Mr. Morgan. The compensation presented
excludes amounts that Jazz Casino Company paid Harrah's Operating Company
to reimburse it for amounts paid to Mr. Morgan. For a description of this
leasing arrangement, refer to "Certain Relationships and Related
Transactions."
(11) Includes $24,000 of rent for an apartment in New Orleans, Louisiana.
EMPLOYMENT AGREEMENTS
We are party to employment agreements dated as of May 6, 1999 with
Frederick W. Burford and an employment agreement dated as of August 25, 1999
with L. Camille Fowler. Mr. Burford and Ms. Fowler are collectively referred to
below as the "executives."
Each executive's employment agreement provides that we will employ the
executive from November 1, 1998 until December 31, 2000 on the terms set forth
in their respective employment agreements. In addition, beginning on December
31, 2000 and on each December 31 thereafter, each executive's employment period
will be automatically extended by an additional one-year period, unless we or
the executive gives timely notice to the other party that no extension will
occur.
In exchange for the executive's services under his or her employment
agreement, during the employment period, the executive will:
- receive an annual base salary, which will be paid in equal monthly or
more frequent installments, at least equal to $260,000 in the case of Mr.
Burford and $145,000 in the case of Ms. Fowler;
- be awarded an annual cash bonus based on corporate and/or individual
performance criteria established annually by the compensation committee,
with a target bonus equal to 50%, in the case of Mr. Burford, or 35%, in
the case of Ms. Fowler, of his or her annual base salary for target
performance;
11
<PAGE> 15
- be entitled to participate in all incentive, savings and retirement
plans, practices, policies and programs provided by us that are
applicable generally to, and on the same basis as, our senior management;
and
- together with the executive's family, be eligible for, and receive all,
benefits under all welfare benefit plans, practices, policies and
programs provided by us, to the extent applicable generally to our senior
management. In addition, we are required to provide each executive with
all fringe benefits in effect for our senior management and, in the case
of Mr. Burford, reimbursement for rental and related maintenance fees and
expenses of an apartment in New Orleans, Louisiana.
We are also obligated to adopt a long-term compensation plan that will
allow each executive to earn over a four-year period 145%, in the case of Mr.
Burford, or 75%, in the case of Ms. Fowler, of his or her annual base salary.
Also, to the extent compensation to an executive consists of stock options,
restricted stock or other equity-based awards that may be vested and/or
exercised, any instrument evidencing this compensation will provide that the
equity awards will continue to vest and/or become exercisable (1) in the case of
Mr. Burford, during the 18-month period following the date his employment
agreement terminates and (2) in the case of Ms. Fowler, during the 12-month
period following the date her employment agreement terminates. However, if the
termination date occurs within two years after a change of control in JCC
Holding Company, these equity awards will vest immediately and be exercisable
for the 24-month period, in the case of Mr. Burford, or the 12-month period, in
the case of Ms. Fowler, following the date of termination.
During the employment period, each executive's employment (1) will
terminate upon his or her death, (2) may be terminated by us with or without
cause or if the executive becomes disabled and (3) may be terminated by the
executive for good reason or for no reason. If, during the employment period, an
executive's employment is terminated by us other than for cause or his or her
disability, or the executive terminates his or her employment for good reason,
then:
- we will pay the executive the accrued obligations that we owe the
executive in the form of a lump sum cash payment equal to the aggregate
of (a) the sum of (1) to the extent unpaid, his or her annual base salary
through the date of termination, (2) the product of (x) his or her target
bonus for the year in which the date of termination occurs and (y) a
fraction, the numerator of which is the number of days in the then
current fiscal year through the date of termination and the denominator
of which is 365, (3) to the extent unpaid, any accrued vacation pay and
(4) to the extent unpaid, any compensation previously deferred by the
executive, and (b) an amount equal to 200%, in the case of Mr. Burford,
or 100% in the case of Ms. Fowler, (or, for Mr. Burford only, 299% if the
date of termination occurs within two years after a change of control) of
the sum of his or her (A) annual base salary and (B) target bonus for the
year in which the date of termination occurs;
- subject to certain limitations, we will continue to provide certain
welfare benefits to the executive and his or her family for 18 months, in
the case of Mr. Burford, or 12 months, in the case of Ms. Fowler, after
the date of termination or such longer period specified in the applicable
plan or program; and
- we will pay or provide any other amounts or benefits required to be paid
or provided to the executive under any of our applicable plans, programs,
policies, practices or contracts.
If, during the employment period, we terminate executive's employment for
cause, the executive voluntarily terminates his or her employment without good
reason, or the executive dies or becomes disabled, we must pay the executive the
accrued obligations that we owe the executive (but in the case of termination by
us for cause or termination by the executive without good reason, we do not have
to pay his or her pro rated target bonus) and provide certain other benefits.
Each executive's employment agreement further provides that the executive
is not required to seek other employment or take other actions to mitigate
amounts payable under the employment agreement, and these amounts will not be
reduced if the executive obtains other employment following the termination of
his employment with us. In addition, each executive is required to hold our and
Harrah's Entertainment's confidential information in a fiduciary capacity for
our benefit and, after the termination of the executive's employment, he or she
may not disclose this confidential information without our prior written
consent.
12
<PAGE> 16
Jazz Casino Company is also party to an agreement dated January 1, 1999
with Thomas M. Morgan under which Mr. Morgan serves as our Vice
President -- Development. Under the terms of this agreement, during 1999, Mr.
Morgan was an employee of Harrah's Operating Company, from which we leased Mr.
Morgan to serve in the capacity of our Vice President -- Development. On January
3, 2000, we began to employ Mr. Morgan directly as our employee for the
three-month period ending March 31, 2000 or for such longer period as we agree
in writing. For this period, Mr. Morgan will receive a prorated base salary
calculated on the basis of the annualized base salary, exclusive of any bonus or
benefits, of $195,000 that was paid to Mr. Morgan by Harrah's Operating Company
as of January 1, 1999. In addition, under the terms of the agreement, on January
3, 2000 Mr. Morgan received a $87,000 bonus and a $50,000 payment for his
hardship, dislocation, and loss of long-term compensation opportunities.
Further, at the termination of Mr. Morgan's employment, subject to achievement
of performance standards and in our sole discretion, we may pay Mr. Morgan a
bonus and a hardship payment calculated on the basis of an annualized amount of
$87,000 and $50,000, respectively, prorated for the actual number of days of his
employment. We also agreed under the agreement to provide Mr. Morgan with
medical and other benefits that are customarily provided to employees at Mr.
Morgan's level. Mr. Morgan's employment agreement was not formally extended on
March 31, 2000 but Mr. Morgan continues to serve as our Vice
President -- Development.
OPTION GRANTS
The following table provides information with regard to stock option grants
to the named executive officers pursuant to our 1998 Long-Term Incentive Plan
during fiscal 1999. All options expire ten years from the date of grant and all
options become exercisable in full on January 1, 2003, or earlier if the average
trading price of the class A common stock or, after the transition date, the
unclassified common stock, over 20 trading days in any 30 consecutive trading
days reaches certain levels prior to January 1, 2003. Options become exercisable
prior to January 1, 2003 with respect to cumulative increments of 20% of the
class A common stock or the unclassified common stock, as the case may be, when
the average trading price reaches $5.00, $6.00, $7.00, $8.00 and $9.00.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF PERCENT OF ANNUAL RATES OF STOCK
SECURITIES TOTAL OPTIONS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OR OPTION TERM
OPTIONS EMPLOYEES IN BASE EXPIRATION -----------------------
NAME GRANTED(#) FISCAL YEAR(1) PRICE($/SH) DATE 5%($) 10%($)
- ---- ---------- -------------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Frederick W. Burford.......... 115,000 53.6% $3.50 3/4/2009 $250,496 $597,904
L. Camille Fowler............. 31,500 14.7 3.50 3/4/2009 68,614 163,774
Frederick J. Keeton........... 19,000 8.9 3.50 3/4/2009 41,386 98,784
Thomas M. Morgan.............. -- -- -- -- -- --
</TABLE>
- ---------------
(1) Options to purchase a total of 214,835 shares of class A common stock were
granted to employees in fiscal 1999 under our 1998 Long-Term Incentive Plan.
Amounts reported in the last two columns represent hypothetical amounts
that may be realized upon exercise of options immediately prior to the
expiration of their term assuming the specified compounded rates of appreciation
of the class A common stock over the term of the options. These numbers are
calculated based on rules promulgated by the SEC and do not reflect our estimate
of future stock price growth. Actual gains, if any, on stock option exercises
and class A common stock holdings are dependent on the timing of such exercises
and the future performance of the class A common stock. We do not guarantee that
the rates of appreciation assumed in this table can be achieved or that the
amounts reflected will be received by the individuals. This table does not take
into account any appreciation of the price of the class A common stock from the
date of grant to the current date.
13
<PAGE> 17
OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information regarding (a) the number of
shares of class A common stock received upon exercise of options by the named
executive officers during fiscal 1999, (b) the net value realized upon such
exercise, (c) the number of unexercised options held at December 31, 1999 and
(d) the aggregate dollar value of unexercised options held at December 31, 1999.
The value of unexercised in-the-money options is equal to the difference between
the option exercise price and the closing sale price of $2.81 per share of class
A common stock on the American Stock Exchange on December 31, 1999 multiplied by
the number of shares underlying the option.
AGGREGATED OPTION EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE DECEMBER 31, 1999(#) DECEMBER 31, 1999($)
NAME EXERCISE(#) REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ---- ----------- ----------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Frederick W. Burford.......... -- -- 92,000/23,000 $--/$--
L. Camille Fowler............. -- -- 25,200/ 6,300 --/ --
Fred J. Keeton................ -- -- 15,200/ 3,800 --/ --
Thomas M. Morgan.............. -- -- --/ -- --/ --
</TABLE>
REPORT OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
INTRODUCTION
The compensation committee is responsible for developing our executive
compensation policies and advising the board of directors with respect to these
policies. This report by the compensation committee reviews our policies
generally with respect to the compensation of all executive officers as a group
for fiscal 1999 and specifically reviews the compensation established for our
Chief Executive Officer for fiscal 1999.
The members of the compensation committee are Seth E. Lemler (Chairman),
Edwin Jacobson and Rudy J. Cerone. None of the committee members is or has been
an officer or employee of us or any of our subsidiaries or has engaged in any
business transaction or has any business relationship that are required to be
disclosed in this proxy statement.
EXECUTIVE COMPENSATION PROGRAM
Our executive compensation program for fiscal 1999 was designed primarily
to attract and retain executive officers following the consummation of the
transactions contemplated by the third amended plan of reorganization of
Harrah's Jazz Company, Harrah's Jazz Finance Corp. and Harrah's New Orleans
Investment Company and the opening of the casino. The fiscal 1999 program
consisted of three elements: a salary (base pay); variable incentive pay (which
was paid in the form of a cash bonus); and long-term incentive pay (stock
options and restricted class A common stock). This program applied to all of our
key management personnel, including our Chief Executive Officer. All of our
executives were also eligible for employee benefits offered to all of our
employees, including life, health, disability and dental insurance and our
401(k) savings plan. Professional compensation consultants assisted the
committee with the design of a long-term compensation plan for our senior
executives for the year ended December 31, 1999 and future years which we
believe will (1) attract and retain a highly qualified and motivated management
team and (2) link the interests of the senior executives directly with those of
stockholders through the use of long-term equity incentives, primarily in the
form of stock options and restricted class A common stock.
Salary. Base salary for executive officers in 1999 was determined by the
compensation committee after consideration of salary levels in the casino and
gaming industry for various executive positions.
14
<PAGE> 18
Annual incentive pay. For services rendered in fiscal 1999, we paid cash
bonuses to our executive officers ranging from $38,000 to $130,000. These
bonuses were based on the Company's attainment of pre-determined objectives,
such as opening the casino on time and within budget and completing a master
plan for the build-out and leasing of the second floor of our casino for
non-gaming entertainment uses.
Long-Term incentive pay. Our long-term incentive program in 1999 consisted
of two components: stock options and restricted class A common stock. These
awards are designed to provide a multi-year incentive program for our senior
executives. For each participant, the compensation committee establishes an
annual long-term incentive compensation amount based on publicly available
comparative data.
Stock Options. During fiscal 1999, we granted stock options to certain of
our executive officers under our 1998 Long-Term Incentive Plan. The options
expire ten years from the date of grant and have an exercise price equal to the
fair market value of the underlying stock on the date of grant. The options
become exercisable in full on January 1, 2003, or earlier if the average trading
price of the class A common stock or, after the transition date, the
unclassified common stock, over 20 trading days in any 30 consecutive trading
days reach certain levels prior to January 1, 2003. Options become exercisable
prior to January 1, 2003 with respect to cumulative increments of 20% of the
class A common stock or the unclassified common stock, as the case may be, at
such time as the average trading price reaches $5.00, $6.00, $7.00, $8.00 and
$9.00.
Restricted Stock. During fiscal 1999, the compensation committee made
awards of restricted class A common stock to certain of our named executive
officers that are subject to certain restrictions on transferability. This
restricted stock is designed to reward executive officers for achieving
long-term performance objectives, such as increasing long-term stockholder
value, and to provide a means of increasing stock ownership by executive
officers. Of the shares of restricted stock issued to the executive officers in
fiscal 1999, the shares vest, and the restrictions thereon expire, in full on
January 1, 2003, or earlier with respect to the following percentages of the
shares upon our obtaining the following performance goals:
(a) 33% of the shares upon determination by the board of directors
that our casino and its parking garage construction were completed by
October 30, 1999 within budget;
(b) 33% of the shares upon determination by the board of directors
that the following have occurred by November 2000 (1) the master plan for
the initial build-out and leasing of the second floor of the casino for
non-gaming uses has been approved by us as well as by the State of
Louisiana and the City of New Orleans; and (2) certain minimum non-gaming
entertainment activities are available on the second floor of the casino;
and
(c) 34% of the shares upon determination by the board of directors
that construction and leasing of the facilities to be built on our real
property located on Fulton and Poydras Streets in the City of New Orleans,
has been substantially completed by November 2001.
Effective as of March 2, 2000, our board of directors determined that the first
performance goal described above was obtained and the restrictions on 33% of
each officer's shares of restricted class A common stock terminated.
CHIEF EXECUTIVE OFFICER'S COMPENSATION
Frederick W. Burford served as our President and Chief Executive Officer
during fiscal 1999. Mr. Burford's fiscal 1999 base salary was $260,000. Based on
our performance in fiscal 1999, including opening the casino on time and within
budget and completing a preliminary master plan for the build-out and leasing of
the second floor of our casino for non-gaming entertainment uses, Mr. Burford
earned an annual incentive bonus of $130,000, which represented 50% of his
target annual incentive pay. Mr. Burford was also granted options to purchase
115,000 shares of class A common stock and 55,000 shares of restricted class A
common stock during fiscal 1999. The level of Mr. Burford's base salary was
based upon the comparative information reviewed by the compensation committee as
described above. Mr. Burford's total compensation for fiscal 1999 is provided in
detail in the Summary Compensation Table set forth above.
15
<PAGE> 19
POLICY WITH RESPECT TO DEDUCTIBILITY OF COMPENSATION EXPENSE
The Omnibus Budget Reconciliation Act of 1993 (OBRA) disallows the
deduction for certain annual compensation in excess of $1,000,000 paid to
certain of our executive officers, unless the compensation qualifies as
"performance-based" under Section 162(m) of the Internal Revenue Code. Our 1998
Long-Term Incentive Plan permits the grant of stock options and other awards
that are fully deductible under Section 162(m). For the year ended December 31,
2000 and future years, we intend to maximize the deductibility of executive
compensation while retaining the discretion necessary to compensate executive
officers in a manner commensurate with performance and the competitive market
for executive talent.
CONCLUSION
Our executive compensation program is designed to closely link pay with
performance and the creation of stockholder value. Under such a program,
depending on the targeted performance level that we reach, our executives will
be compensated at varying levels. We believe that this program is and will be
successful in supporting our financial, growth and other business objectives.
COMMITTEE MEMBERS:
Seth E. Lemler
Edwin Jacobson
Rudy J. Cerone
OTHER MEMBERS OF THE BOARD:
Colin V. Reed
Eddie N. Williams
Philip G. Satre
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Harrah's Entertainment stock ownership. As of March 23, 2000, Harrah's
Entertainment, through Harrah's Crescent City Investment Company, an indirect
wholly-owned subsidiary of Harrah's Entertainment, owned 4,302,623 shares of
class B common stock, or approximately 96.6% of all of the issued and
outstanding shares of class B common stock, and approximately 42.6% of all of
the issued and outstanding shares of class A and class B common stock.
Accordingly, Harrah's Entertainment, through Harrah's Crescent City Investment
Company, is able to elect all of the Class B directors, who, prior to the
transition date, generally supervise our day-to-day activities. Further,
Harrah's Crescent City Investment Company was granted a warrant entitling it,
upon and after the transition date, to purchase shares of unclassified common
stock such that, upon exercise of the warrant in its entirety, Harrah's
Entertainment and its subsidiaries will own in the aggregate 50% of the then
outstanding shares of unclassified common stock.
Casino management agreement. Our subsidiary, Jazz Casino Company, and
Harrah's New Orleans Management Company, an indirect wholly-owned subsidiary of
Harrah's Entertainment, have entered into a management agreement, dated as of
October 29, 1998, under which Harrah's New Orleans Management Company is
exclusively responsible for supervising and managing our casino's operations.
During 1999 Jazz Casino Company reimbursed Harrah's New Orleans Management for
$100,000 of travel expenses that it incurred in connection with managing the
casino. In addition, as of December 31, 1999, Jazz Casino Company had deferred
the payment of approximately $1.3 million in management fees payable to Harrah's
New Orleans Management Company under the management agreement.
Minimum payment and loan guarantees. Under the terms of Jazz Casino
Company's casino operating contract with the Louisiana Gaming Control Board,
Jazz Casino Company is required to obtain a guaranty in favor of the State of
Louisiana by and through the Louisiana Gaming Control Board to assure payment of
a $100 million minimum annual payment due to the State of Louisiana by Jazz
Casino Company under its casino operating contract. On October 30, 1998, Jazz
Casino Company entered into an agreement with Harrah's Entertainment and
Harrah's Operating Company under which Harrah's Entertainment and Harrah's
16
<PAGE> 20
Operating Company have agreed to provide this guaranty of the $100 million
minimum payment obligation on an annual basis through March 31, 2004, which is
subject to annual non-renewal in accordance with the terms of the agreement. As
of December 31, 1999, Jazz Casino Company had deferred approximately $1.1
million in fees payable to Harrah's Entertainment and Harrah's Operating Company
under the minimum payment guaranty agreement. To ensure that we have sufficient
liquidity to satisfy our operating expenses, on February 28, 2000, Jazz Casino
Company stopped making the required daily payment of the minimum payment
obligation due to the Louisiana Gaming Control Board under the casino operating
contract and on February 29, 2000, Harrah's Entertainment and Harrah's Operating
Company, in accordance with their minimum payment guaranty, began making the
required daily payment of the minimum payment obligation due to the Louisiana
Gaming Control Board under the casino operating contract. Harrah's Entertainment
and Harrah's Operating Company have also provided a payment guarantee or "put"
agreement for an aggregate principal amount of up to $166.5 million of our loans
and/or stated amount of letters of credit under the Credit Agreement, dated as
of October 29, 1998, among Jazz Casino Company, as borrower, JCC Holding
Company, as guarantor, the banks parties thereto and Bankers Trust Company, as
administrative agent. In exchange for this loan guaranty, Jazz Casino Company
has agreed to pay Harrah's Entertainment an annual credit support fee equal to
0.75% of the average aggregate principal amount of loans and/or stated amount of
letters of credit that are guaranteed. As of December 31, 1999, Jazz Casino
Company had deferred approximately $387,000 of fees payable to Harrah's
Entertainment and Harrah's Operating Company under this loan guaranty.
Completion guarantees. Pursuant to their completion guarantees, Harrah's
Entertainment and Harrah's Operating Company agreed, among other things, to (1)
fund Jazz Casino Company's working capital shortfalls until the date on which,
among other things, the casino is equipped with the required furniture, fixtures
and equipment and ready to open for business, the casino construction is
substantially completed and initial casino operations have opened for business
and (2) to guarantee that, at such time, Jazz Casino Company will have available
for working capital $5 million of cash and an amount equal to $25 million (less
up to $10 million for certain letters of credit issued under our credit
agreement and borrowings thereunder to fund a bank account for the casino)
available for immediate borrowing(s) under the working capital facility provided
pursuant to our credit agreement.
Pursuant to their completion guarantees, Harrah's Entertainment and
Harrah's Operating Company have also agreed to guarantee certain obligations of
Jazz Casino Company including, among others, the following: (a) the obligation
to complete and timely pay for the construction and equipping of the casino in
accordance with the terms of (1) the Amended and Restated Lease Agreement, dated
October 29, 1998, among Jazz Casino Company, the Rivergate Development
Corporation and the City of New Orleans, as intervenor, (2) the General
Development Agreement, dated October 29, 1998, among Jazz Casino Company, the
Rivergate Development Corporation and the City of New Orleans, as intervenor,
(3) the indentures under which Jazz Casino Company's senior subordinated notes
with contingent payments and its senior subordinated contingent notes are issued
and (4) any applicable requirement of the Louisiana Gaming Control Board and (b)
the obligation to maintain insurance coverage for, and prevent deterioration and
unauthorized access to, the casino, and to pay on a timely basis certain amounts
owing by Jazz Casino Company. Any expenditures made by Harrah's Entertainment or
Harrah's Operating Company under these guarantees must be repaid by Jazz Casino
Company pursuant to the Amended and Restated Subordinated Completion Loan
Agreement, dated as of October 30, 1998, with Harrah's Entertainment and
Harrah's Operating Company. We estimate that Jazz Casino Company will borrow an
amount ranging from $5 million to $8 million under the completion loan agreement
with Harrah's Entertainment and Harrah's Operating Company pursuant to their
completion guarantees to fund the balance of the casino's construction and
pre-opening costs.
Construction lien indemnity obligations. Jazz Casino Company has obtained a
title insurance policy from First American Title Insurance Company for the
premises underlying the casino leased by Jazz Casino Company and certain related
leased property. Pursuant to the Amended and Restated Construction Lien
Indemnity Obligation Agreement dated October 30, 1998 between Jazz Casino
Company and Harrah's Operating Company, any expenditures made by Harrah's
Operating Company under a construction lien indemnity agreement delivered by
Harrah's Entertainment and Harrah's Operating Company to First American Title
Insurance Company regarding mechanic's liens that claim priority to loans and
reimburse-
17
<PAGE> 21
ment obligations for letters of credit under our credit agreement, Jazz Casino
Company's senior subordinated notes with contingent payments or its senior
subordinated contingent notes, will be deemed unsecured limited recourse
indebtedness of Jazz Casino Company to Harrah's Operating Company, due and
payable on demand.
Junior subordinated credit facility and second floor construction and
master plan financing. Harrah's Entertainment and Harrah's Operating Company
have agreed to provide Jazz Casino Company with up to $22.5 million of
subordinated financing under a junior subordinated credit facility. As of
December 31, 1999, $22.5 million of principal was outstanding under the junior
subordinated credit facility and Jazz Casino Company had accrued approximately
$1.3 million of interest payable under the facility. To fund the development of
a master plan for the build-out and leasing of the second floor of our casino
for non-gaming entertainment uses and construction-related work that needed to
take place on the second floor of our casino prior to its opening in order to
prevent disruption to the casino's gaming operations, on October 26, 1999 our
wholly-owned subsidiary, JCC Development Company, L.L.C., arranged to borrow up
to $2 million from a subsidiary of Harrah's Entertainment to fund these items.
Borrowings under this loan bear interest at 9% per year, and, at JCC Development
Company's option, may be repaid in cash or in kind. Principal and interest under
this loan must be paid out of the permanent financing ultimately obtained for
the completion of the second floor of the casino. As of December 31, 1999,
approximately $1.2 million of principal and accrued interest were outstanding
under this borrowing arrangement.
Administrative services and executive leasing agreements. Pursuant to an
administrative services agreement, during fiscal 1999 Harrah's Operating
Company, a wholly-owned subsidiary of Harrah's Entertainment, provided us
various administrative systems and services (including, among others,
accounting, payroll and risk management services, and human resources
administration). Pursuant to the limited forebearance agreement described below,
during fiscal 1999 Jazz Casino Company deferred the fees owed under this
administrative services agreement. In addition, Jazz Casino Company entered into
executive leasing agreements with Harrah's Operating Company pursuant to which
Harrah's Operating Company agreed to lease to Jazz Casino Company the services
of Donald Stroessner and Thomas M. Morgan, each employees of Harrah's Operating
Company. Under the executive lease agreement dated July 1, 1998 for Mr.
Stroessner, Mr. Stroessner oversaw and managed the design and construction of
the casino. In exchange for Mr. Stroessner's services, Jazz Casino Company paid
Harrah's Operating Company approximately $32,000 for services rendered by Mr.
Stroessner during November and December 1998 and approximately $221,000 for
services rendered during 1999. Under the executive lease agreement dated
December 15, 1999 for Mr. Morgan, Mr. Morgan served in the capacity of Vice
President -- Development until January 3, 2000, at which time he became our
direct employee. On November 18, 1999, the board of directors formally appointed
Mr. Morgan as our Vice President -- Development. In exchange for Mr. Morgan's
services, Jazz Casino Company and JCC Development Company, on a combined basis,
paid Harrah's Operating Company approximately $259,000 for services rendered by
Mr. Morgan during 1999. Jazz Casino Company has also agreed to pay additional
amounts directly to Mr. Morgan for his services. For a description of these
amounts, refer to "Executive Compensation -- Employment Agreements." Jazz Casino
Company also arranged to lease from Harrah's Operating Company the services of
Fred J. Keeton. Under this executive lease arrangement, Mr. Keeton served as our
Vice President -- Government Affairs and Community Relations until July 1, 1999,
at which time he became our direct employee, also serving as Vice
President -- Government Affairs and Community Relations. In exchange for Mr.
Keeton's services, Jazz Casino Company paid Harrah's Operating Company $55,500
for services rendered by Mr. Keeton during the next six month period ended June
30, 1999. In addition, during 1999 we leased the services of two additional
people from Harrah's Operating Company in exchange for which we paid Harrah's
Operating Company an aggregate of approximately $150,000 for their services
rendered in 1999.
Slot machine lease. To finance the loading of the slot machines with
approximately $6.0 million in coins, in a sale and leaseback transaction on
October 20, 1999, Jazz Casino Company sold 1,085 of its slot machines to a
subsidiary of Harrah's Entertainment for approximately $6.0 million. The
Harrah's Entertainment subsidiary is leasing the slot machines back to Jazz
Casino Company and Jazz Casino Company used the proceeds from the sale to fill
the slot machines with coins. Pursuant to the limited forebearance agreement
18
<PAGE> 22
described below, during fiscal 1999, Jazz Casino Company deferred its lease
payments to the Harrah's Entertainment subsidiary.
Forebearance agreement. On February 29, 2000, Jazz Casino Company entered
into a limited forebearance agreement with Harrah's New Orleans Management
Company, the manager of our casino, and Harrah's Operating Company. Under this
forbearance agreement, Harrah's Operating Company and/or Harrah's New Orleans
Management Company agreed to forebear until August 1, 2000 the payment of the
following items owed by Jazz Casino Company:
- rent and certain additional charges owed with respect to certain
equipment used at the casino that Jazz Casino Company leases from
Harrah's Operating Company;
- fees owed with respect to certain administrative services that Harrah's
Operating Company provides Jazz Casino Company under an administrative
services agreement; and
- certain costs, expenses and services for which Jazz Casino Company is
required to reimburse Harrah's New Orleans Management Company under its
management agreement.
As of December 31, 1999, Jazz Casino Company had deferred approximately $2.7
million in accordance with the forbearance agreement.
Casino opening reimbursements. During 1999 we reimbursed Harrah's
Entertainment and its affiliates for approximately $1.0 million of certain
expenses that they incurred in connection with opening the casino, including
relocating employees to the New Orleans area and providing personnel to train
our casino employees and staff the grand opening of the casino.
Affiliate transactions and competition. Currently, the Chairman of the
board, Colin V. Reed, is also (1) a member of Harrah's Entertainment's board of
directors, (2) a member of Harrah's Entertainment's three-Executive Office of
the President, and (3) Chief Financial Officer of Harrah's Entertainment. Colin
V. Reed is expected to continue to serve as a Class B director while also
serving in these capacities with Harrah's Entertainment and Harrah's New Orleans
Management Company. In addition, Eddie N. Williams, a Class B director, is a
director of Harrah's Entertainment, and Philip G. Satre, a Class B director, is
also the Chairman of the board, Chief Executive Officer, and President of
Harrah's Entertainment and the Chairman of the board and Chief Executive Officer
of Harrah's New Orleans Management Company. Harrah's Entertainment owns or
controls (indirectly through one or more subsidiaries or affiliates) dockside
casinos in Vicksburg and Tunica, Mississippi, Shreveport, Louisiana, and two
riverboat casinos in Lake Charles, Louisiana. Harrah's Entertainment (or one or
more of its subsidiaries or affiliates) may also develop other casinos that may
compete with our casino. As a result of Harrah's Entertainment's ownership of
certain casinos that may, or currently, compete with our casino, together with
the positions held by Messrs. Reed, Satre and Williams as both Class B directors
and officers or directors of Harrah's Entertainment, a conflict of interest may
be deemed to exist by reason of such persons' access to our information and
business opportunities, any or all of which could be useful to one or more of
its competing casinos. The indentures governing Jazz Casino Company's senior
subordinated notes with contingent payments and senior subordinated contingent
notes, its management agreement with Harrah's New Orleans Management Company and
our credit agreement each impose restrictions on our ability to enter into
transactions with affiliates, including Harrah's Entertainment. In addition, the
board of directors has implemented procedures that require transactions with
affiliates to be approved by disinterested directors. We cannot assure you,
however, that the restrictions in these agreements or these procedures will
successfully resolve conflicts of interest confronting us, or which we may
confront.
19
<PAGE> 23
STOCK PERFORMANCE GRAPHS
The following performance graph and accompanying table compare the
stockholders' cumulative return on the class A common stock with the cumulative
total return of the Standard & Poor's Small Cap 600 Stock Index and the Gaming,
Lottery and Paramutual Companies Industry Group of the S&P Small Cap 600 Stock
Index from December 9, 1998, the date the class A common stock began trading on
the American Stock Exchange, and ending on December 31, 1999. The comparative
data assumes $100.00 was invested on December 9, 1998 in the class A common
stock and in each of the indices referred to above and assumes that dividends,
if any, were reinvested.
COMPARISON OF CUMULATIVE TOTAL RETURNS
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
DESCRIPTION DECEMBER 9, 1998 DECEMBER 31, 1998 DECEMBER 31, 1999
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
JCC Holding Company $100.00 $ 96.43 $ 80.36
S&P SmallCap 600 Index $100.00 $105.88 $119.02
S&P Smallcap 600 Gaming Index $100.00 $104.39 $161.02
</TABLE>
The stock price performance shown in the table set forth above is not
necessarily indicative of future stock price performance. Information used in
the table was obtained from Zacks Investment Research, Inc., a source believed
to be reliable, but we are not responsible for any errors or omissions in this
information.
The stock performance graph is not "soliciting material," is not deemed
filed with the SEC and is not to be incorporated by reference in any of our
filings under the Securities Act of 1933, as amended, or the Securities Exchange
Act of 1934, as amended, whether made before or after the date hereof and
irrespective of any general incorporation language in any such filing.
20
<PAGE> 24
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The United States securities laws require our directors and executive
officers and any persons who beneficially own more than 10% of our common stock,
as well as certain affiliates of these persons, to file initial reports of their
ownership of class A and class B common stock and subsequent reports of changes
in such ownership with the SEC and the American Stock Exchange. To our
knowledge, based solely on our review of the copies of the reports furnished to
us and written representations that no other reports were required, during
fiscal 1999, all directors, executive officers and beneficial owners of more
than 10% of our common stock made all required filings, except that Mr. Thomas
M. Morgan failed to timely file his Initial Statement of Beneficial Ownership of
Securities on Form 3 in January 1999 and Mr. Frederick J. Keeton failed to
timely file his Initial Statement of Beneficial Ownership of Securities on Form
3 in September 1998, one Statement of Changes in Beneficial Ownership on Form 4
in April 1999 reporting our grant to him of stock options, and one Statement of
Changes in Beneficial Ownership on Form 4 in May 1999 reporting our grant to him
of shares of restricted class A common stock.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The board of directors has appointed the firm of Deloitte & Touche LLP to
serve as our independent accountants for the year ending December 31, 2000. The
board has directed that such appointment be submitted to our stockholders for
ratification at the annual meeting. Deloitte & Touche LLP has served as our
independent accountants since October 30, 1998 and we consider it to be well
qualified. If the stockholders do not ratify the appointment of Deloitte &
Touche LLP, the board of directors will reconsider the appointment.
Representatives of Deloitte & Touche LLP will be present at the annual
meeting. They will have an opportunity to make a statement if they desire to do
so and will be available to respond to appropriate questions from stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE "FOR"
THE PROPOSAL TO RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS OUR
INDEPENDENT ACCOUNTANTS FOR THE YEAR ENDING DECEMBER 31, 2000.
STOCKHOLDERS' PROPOSALS FOR 2001 ANNUAL MEETING
Nominations by stockholders for director elections and other proposals of
stockholders intended to be presented at the 2001 annual meeting of
stockholders, together with certain related information specified in the SEC's
Rule 14a-8, must be submitted to us in writing on or before December 20, 2000 in
order for the matters to be included in our proxy materials for the 2001 annual
meeting of stockholders. Nominations and other proposals of stockholders that
are submitted to us after this date may be excluded from our proxy materials for
the 2001 annual meeting of stockholders and will otherwise be subject to the
SEC's Rule 14a-4(c). See "Voting -- Proxies; Other Matters That May Come Before
the Annual Meeting."
As provided in our Bylaws, to submit a nominee to stand for election as a
director at the 2001 annual meeting of stockholders or a proposal to be
presented at this meeting, you must provide us notice. We must receive this
notice not less than sixty nor more than ninety days, in the case of the
submission of a director nominee, and not less than sixty nor more than
one-hundred and twenty days, in the case of the submission of a proposal, prior
to May 16, 2001. However, if less than seventy days notice or prior public
disclosure of the date of such meeting is given or made to stockholders, notice
by the stockholder, to be timely, must be received by us no later than the close
of business on the tenth day following the day on which the notice of the date
of the meeting was mailed or such public disclosure was made, whichever first
occurs. In addition, any notice must contain the information required by our
Bylaws.
21
<PAGE> 25
All nominations, proposals and related information with regard to the 2001
annual meeting of stockholders should be submitted by certified mail, return
receipt requested, to JCC Holding Company, One Canal Place, 365 Canal Street,
Suite 900, New Orleans, Louisiana 70130, Attention: L. Camille Fowler, Vice
President -- Finance, Treasurer and Secretary.
By Order of the Board of Directors.
/s/ L. CAMILLE FOWLER
L. Camille Fowler
Vice President -- Finance, Treasurer
and Secretary
New Orleans, Louisiana
April 19, 2000
------------------------------------
Our 1999 Annual Report and our Annual Report on Form 10-K for the fiscal
year ended December 31, 1999, which includes audited financial statements, have
been mailed to our stockholders with these proxy materials. These materials do
not form any part of the material for the solicitation of proxies.
22
<PAGE> 26
PROXY
CLASS A COMMON STOCK
JCC HOLDING COMPANY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
2000 ANNUAL MEETING OF STOCKHOLDERS
The undersigned hereby appoints Frederick W. Burford and L. Camille Fowler, and
each of them, proxies, with full power of substitution, to act for and in the
name of the undersigned to vote all shares of Class A Common Stock ("Common
Stock") of JCC Holding Company, a Delaware corporation (the "Company"), which
the undersigned is entitled to vote at the 2000 Annual Meeting of Stockholders
of the Company, to be held at the Harrah's New Orleans Casino in the Mansion
Ballroom, 4 Canal Street, New Orleans, Louisiana, on May 16, 2000 at 10:00 a.m.
central time and at any adjournments thereof, as indicated below and subject to
the conditions specified below.
THIS PROXY CARD WILL BE VOTED AS DIRECTED. IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY CARD WILL BE VOTED IN THE DISCRETION OF THE PROXIES "FOR" THE
ELECTION OF THE NOMINEE NAMED IN PROPOSAL 1 AND "FOR" PROPOSAL 2. At the
present time, the Board of Directors knows of no other business to be presented
to a vote of the stockholders at the Annual Meeting. However, the proxies are
hereby authorized to vote in their discretion on any stockholder proposals
subsequently presented for a vote of the stockholders at the Annual Meeting, as
well as on the election of any person selected in accordance with the Company's
Restated Certificate of Incorporation as a director nominee if the director
nominee named in Proposal 1 is unable to serve or for good cause will not
serve, and on matters incident to the conduct of the Annual Meeting.
If the undersigned notifies the Secretary of the Company at or prior to the
Annual Meeting or any adjournments thereof of the decision of the undersigned
to withdraw this proxy card, then the power of said proxies shall be deemed
terminated and of no further force and effect. If the undersigned withdraws
this proxy card in the manner described above and prior to the Annual Meeting
or any adjournments thereof does not submit a duly executed and subsequently
dated proxy card to the Company, the undersigned may vote in person at the
Annual Meeting all shares of Common Stock owned by the undersigned as of the
record date, March 23, 2000.
- ----------- -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
- ----------- -----------
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS
PROXY CARD IN THE ENCLOSED PREPAID ENVELOPE.
<PAGE> 27
o Please detach here o
<TABLE>
<S> <C> <C> <C>
29.000
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
1. The election of Edwin Jacobson as a Class A Director of the [ ] Vote FOR [ ] Vote WITHHELD
Company to serve until the 2003 Annual Meeting of the Company's the nominee from the nominee
stockholders and until his successor is duly elected and qualified.
2. The ratification of the appointment of Deloitte & Touche LLP as the
Company's independent accountants for the fiscal year ending
December 31, 2000. [ ] For [ ] Against [ ] Abstain
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION
IS GIVEN, WILL BE VOTED FOR EACH PROPOSAL.
Address Change? Mark Box [ ] Mark here if you plan to [ ]
Indicate changes below. attend the Annual Meeting Date
----------------------
[ ]
Signature(s) in Box
Please sign exactly as your name appears on this
proxy card. When shares are held jointly, both
holders should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give your full title. If the holder is a
corporation or a partnership, the full corporate
or partnership name should be signed by a duly
authorized officer.
</TABLE>
<PAGE> 28
PROXY
CLASS B COMMON STOCK
JCC HOLDING COMPANY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
2000 ANNUAL MEETING OF STOCKHOLDERS
The undersigned hereby appoints Frederick W. Burford and L. Camille Fowler, and
each of them, proxies, with full power of substitution, to act for and in the
name of the undersigned to vote all shares of Class B Common Stock ("Common
Stock") of JCC Holding Company, a Delaware corporation (the "Company"), which
the undersigned is entitled to vote at the 2000 Annual Meeting of Stockholders
of the Company, to be held at the Harrah's New Orleans Casino in the Mansion
Ballroom, 4 Canal Street, New Orleans, Louisiana, on May 16, 2000 at 10:00 a.m.
central time and at any adjournments thereof, as indicated below and subject to
the conditions specified below.
THIS PROXY CARD WILL BE VOTED AS DIRECTED. IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY CARD WILL BE VOTED IN THE DISCRETION OF THE PROXIES "FOR" THE
ELECTION OF THE NOMINEE NAMED IN PROPOSAL 1 AND "FOR" PROPOSAL 2. At the
present time, the Board of Directors knows of no other business to be presented
to a vote of the stockholders at the Annual Meeting. However, the proxies are
hereby authorized to vote in their discretion on any stockholder proposals
subsequently presented for a vote of the stockholders at the Annual Meeting, as
well as on the election of any person selected in accordance with the Company's
Restated Certificate of Incorporation as a director nominee if the director
nominee named in Proposal 1 is unable to serve or for good cause will not
serve, and on matters incident to the conduct of the Annual Meeting.
If the undersigned notifies the Secretary of the Company at or prior to the
Annual Meeting or any adjournments thereof of the decision of the undersigned
to withdraw this proxy card, then the power of said proxies shall be deemed
terminated and of no further force and effect. If the undersigned withdraws
this proxy card in the manner described above and prior to the Annual Meeting
or any adjournments thereof does not submit a duly executed and subsequently
dated proxy card to the Company, the undersigned may vote in person at the
Annual Meeting all shares of Common Stock owned by the undersigned as of the
record date, March 23, 2000.
- ----------- -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
- ----------- -----------
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS
PROXY CARD IN THE ENCLOSED PREPAID ENVELOPE.
<PAGE> 29
o Please detach here o
<TABLE>
<S> <C> <C> <C>
29.000
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS.
1. The election of Eddie N. Williams as a Class B Director of the [ ] Vote FOR [ ] Vote WITHHELD
Company to serve until the 2003 Annual Meeting of the Company's the nominee from the nominee
stockholders and until his successor is duly elected and qualified.
2. The ratification of the appointment of Deloitte & Touche LLP as the
Company's independent accountants for the fiscal year ending
December 31, 2000. [ ] For [ ] Against [ ] Abstain
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION
IS GIVEN, WILL BE VOTED FOR EACH PROPOSAL.
Address Change? Mark Box [ ] Mark here if you plan to [ ]
Indicate changes below. attend the Annual Meeting Date
----------------------
[ ]
Signature(s) in Box
Please sign exactly as your name appears on this
proxy card. When shares are held jointly, both
holders should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give your full title. If the holder is a
corporation or a partnership, the full corporate
or partnership name should be signed by a duly
authorized officer.
</TABLE>
