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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 20 2000
(November 13, 2000)
HARRAH'S ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 1-10410 62-1411755
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
5100 WEST SAHARA AVENUE, SUITE 200
LAS VEGAS, NEVADA 89146
(Address of Principal Executive Offices) (Zip Code)
(702) 579-2300
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
JCC Holding Company ("JCC"), the owner and operator of the New Orleans,
Louisiana land-based casino managed by a subsidiary of Harrah's Entertainment,
Inc. (the "Company") pursuant to contract (the "Casino"), has approached the
Company, JCC's banks and bondholders, the State of Louisiana, and the City of
New Orleans regarding a proposed restructuring of JCC's financial obligations.
The City of New Orleans has appointed a Casino Tax Advisory Committee to
evaluate JCC's proposed restructuring. The Casino Tax Advisory Committee was
assembled by the Mayor of New Orleans to document its findings on the economic
impact of the Casino, owned by Jazz Casino Company, LLC, JCC's wholly-owned
subsidiary, and make recommendations to the Mayor regarding the $100 million
minimum payment due to the State of Louisiana and other relevant matters.
On November 13, 2000, Jefferies & Company, Inc., financial advisors to
JCC ("Jeffries"), presented a proposed plan for restructuring JCC's financial
obligations based upon Jefferies' analysis and advice, to the Casino Tax
Advisory Committee. During this presentation, JCC proposed various concessions
to be made by its securities holders, its lenders, its affiliates, the Company
and its subsidiaries, the State of Louisiana, and other parties to whom JCC has
contractual or legal obligations.
JCC's financial advisors have concluded that as currently configured
the Casino is not financially viable because current and projected revenue is
not and is not expected to be sufficient to pay all operating expenses, minimum
taxes and debt service. JCC has reported that, while the financing required for
the Casino's operations has been arranged through March 31, 2001, JCC's ability
to continue as a viable business beyond that time is in doubt absent a
significant restructuring of its finances.
JCC has reported that it believes that unless the $100 million minimum
payment due to the State of Louisiana is reduced and economic concessions are
obtained from numerous other parties to whom JCC has financial obligations, JCC
will not be able to continue as a viable business.
Among other things, JCC's restructuring proposal included the
recommendation of a pre-negotiated bankruptcy proceeding to achieve a
reorganization of JCC's financial arrangements and capital structure. Jefferies
advised JCC that confirmation of a plan in bankruptcy to achieve such a result
would likely involve the elimination of the equity held by JCC's current
stockholders, including the Company. JCC's proposal also contemplates a rolling
three-year guarantee by a third party guarantor of JCC's annual State tax
payments.
The proposals made by JCC have not been formally considered or approved
by the Company's board of directors or any other parties and cannot be
implemented until such approval is received. Absent a restructuring of the
fundamental economics of JCC in a manner acceptable to the Company, the Company
will not provide any guarantee of the JCC State tax obligation beyond March 31,
2000.
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Had JCC's proposed restructuring plan been implemented as of September
30, 2000, the Company estimates that it would have written off approximately
$200 million in loans, interest, deferred fees, and other charges. No assurance
can be given that the amount of any Company write-off associated with JCC's
current or any other proposal to restructure its financial obligations will not
be greater than $200 million and no assurance can be given that JCC's current or
any other proposal to restructure its financial obligations will be approved by
the Company's board of directors or any other parties.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
HARRAH'S ENTERTAINMENT, INC.
Date: November 20, 2000 By: /s/ Stephen H. Brammell
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Name: Stephen H. Brammell
Title: Senior Vice President and
General Counsel
