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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 (AMENDMENT NO. )
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<S> <C>
Filed by the registrant /x/ / / Confidential, for Use of the
Filed by a party other than the registrant / / Commission Only (as permitted
Check the appropriate box: by Rule 14a-6(e)(2)
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/ / Preliminary proxy statement
/ / Definitive proxy statement
/x/ Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
CALIFORNIA JOCKEY CLUB
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/ / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/x/ $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: 1/
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/x/ Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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1. Set forth the amount on which the filing fee is calculated and state how
it was determined.
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August 22, 1996
Dear Fellow California Jockey Club Stockholder:
In previous correspondence, WE HAVE DETAILED FOR YOU THE CALIFORNIA JOCKEY CLUB
NOMINEES' PLANS TO INCREASE STOCKHOLDER VALUE, PROVIDE THE OPPORTUNITY FOR
ADDITIONAL EARNINGS AND INCREASED DIVIDENDS, AND GENERATE FUNDS TO SUPPLY BAY
MEADOWS' STABLE NEEDS, THEREBY SUPPORTING THE CONTINUANCE OF RACING AT BAY
MEADOWS.
THE DISSIDENTS say they don't like our plan. As explained below, we believe
they are misguided. What we find particularly frustrating, however, is that
they HAVE NOT PROPOSED A PLAN of their own. No strategy, not even ideas on what
needs to be done to increase stockholder value and preserve live racing at Bay
Meadows. All they have said is that their "nominees are committed to reviewing
the issues thoroughly."
It is difficult for us to believe that they expect you to elect their nominees
to the Board, thus taking control of California Jockey, without a plan in place
and with a slate of nominees that, to our knowledge, has only one member with
any substantial commercial real estate experience -- and his track record
includes partnerships and companies that have defaulted on millions of dollars
of loans and at least three developments that went into foreclosure.
IF YOU STILL HAVE ANY DOUBT THAT CALIFORNIA JOCKEY'S NOMINEES SHOULD BE
RE-ELECTED, WE BELIEVE A BRIEF REVIEW OF OUR PLAN WILL MAKE THE CHOICE CLEAR.
THE PLAN INCLUDES:
THE SALE, IN TWO TRANSACTIONS, OF 73 OF THE 178 ACRES OF LAND CJC OWNS
AT BAY MEADOWS FOR $52 MILLION. THIS IS ROUGHLY $9 PER SHARE.
In their latest letter, the dissidents say this is "less than the land's fair
value" and cite an MAI appraisal indicating a value of approximately $600,000
per acre. Do the math yourself: $52 million divided by 73 acres is
approximately $712,000 per acre. This is $100,000 more per acre than the
appraised value they cite.
AN AGREEMENT FOR HUDSON BAY PARTNERS TO INVEST $300 MILLION IN CASH INTO
TWO NEW LIMITED PARTNERSHIPS, INTO WHICH CJC/BMOC WOULD CONTRIBUTE ALL OF
THEIR ASSETS, IN EXCHANGE FOR INTEREST IN THOSE PARTNERSHIPS WHICH WILL BE
CONVERTIBLE INTO 72% OF THE COMMON STOCK OF CJC/BMOC AT AN EFFECTIVE PRICE
OF $20 PER COMMON SHARE.
The dissidents claim that "if consummated, the transaction will foreclose . . .
shareholders from ever obtaining a true premium for surrendering control of
(the) company." The fact is, the price at which Hudson Bay would be acquiring
the stock is a premium of 26% above the average closing price of the stock over
the 12 months ended August 16, 1996 (the last trading day before the Hudson Bay
transaction was announced). MOST IMPORTANT, THE TRANSACTION IS SUBJECT TO
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STOCKHOLDER APPROVAL. The dissidents note that "Cal Jockey has agreed to pay
Hudson Bay a breakup fee of $2.9 million," but they don't tell you that if the
stockholders don't approve the transaction, no breakup fee whatsoever will be
owed.
The dissidents claim that "Management has no plan to deal with the critical
need for stabling horses . . ." Apparently they haven't been reading our
letters. As we have stated previously, the CJC Board is looking at a number of
alternatives to meet the track's stabling needs. These include building barns
on leased land adjacent to Bay Meadows; building barns on remaining Bay Meadows
property; and leasing stables and facilities at the Alameda County Fairgrounds
in Pleasanton (Alameda County Fair has indicated in writing its interest in
such an arrangement). As we pointed out in previous correspondence,
off-track stabling is a viable alternative. It is being done successfully
elsewhere.
WE ARE CONFIDENT THAT AFTER REVIEWING THE FACTS, YOU WILL CONCLUDE THAT THE
CHOICE IS AN EASY ONE. UNLIKE THE DISSIDENTS, WE HAVE A PLAN IN PLACE TO PROVIDE
FOR THE CONTINUATION OF LIVE RACING AT BAY MEADOWS, ENHANCE STOCKHOLDER VALUE
AND PROVIDE FOR INCREASED EARNINGS AND DIVIDENDS. PLEASE RETURN THE YELLOW
PROXY CARD AND SUPPORT THE CALIFORNIA JOCKEY CLUB NOMINEES.
Before closing, I would like to thank the company's stockholders for their
continued confidence in the CJC Board. Your expressions of support over the
past several weeks have been particularly appreciated. We look forward to
continuing to serve your interests.
Sincerely,
Kjell Qvale
Chairman of the Board
IMPORTANT
ONLY YOUR LATEST DATED CARD COUNTS
PLEASE MARK, SIGN, DATE, AND RETURN THE
YELLOW PROXY CARD IN THE ENVELOPE PROVIDED.
If your shares are held in an account at a brokerage firm, only that brokerage
firm can vote your shares, and only upon receipt of your specific instructions.
Accordingly, please contact your account representative to have your shares
voted on the YELLOW proxy card and mail in the return envelope provided.
IF YOU HAVE ANY QUESTIONS OR NEED ASSISTANCE, PLEASE CALL:
D.F. KING & CO., INC.
1-800-848-3094
