-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BSPQZcvJsGuyuN+rTokADxK9Y4wr2du8n4DDuCi7grDgHEOGjCT4Dq5evgm4lwAF 7BSK1kz2eRYBeMA8k4dIxQ== 0000912057-96-017010.txt : 19960813 0000912057-96-017010.hdr.sgml : 19960813 ACCESSION NUMBER: 0000912057-96-017010 CONFORMED SUBMISSION TYPE: PRRN14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19960812 SROS: AMEX SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CALIFORNIA JOCKEY CLUB CENTRAL INDEX KEY: 0000016343 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-RACING, INCLUDING TRACK OPERATION [7948] IRS NUMBER: 940358820 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: PRRN14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-09319 FILM NUMBER: 96607780 BUSINESS ADDRESS: STREET 1: 2600 S DELAWARE ST STREET 2: P O BOX 1117 CITY: SAN MATEO STATE: CA ZIP: 94402 BUSINESS PHONE: 4155734514 MAIL ADDRESS: STREET 1: 2600 S DELAWARE ST CITY: SAN MATEO STATE: CA ZIP: 94402 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE CENTRAL INDEX KEY: 0001014444 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: PRRN14A BUSINESS ADDRESS: STREET 1: 559 BARRON AVE CITY: PALO ALTO STATE: CA ZIP: 94306 BUSINESS PHONE: 4158424677 MAIL ADDRESS: STREET 1: 559 BARRON AVE CITY: PALO ALTO STATE: CA ZIP: 94306 PRRN14A 1 PRRN14A SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant [ ] Filed by Party other than the Registrant [x] Check the appropriate box: [x] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) [ ] Definitive Proxy Statement [ ] Definitive Additional Materials [ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12 CALIFORNIA JOCKEY CLUB - -------------------------------------------------------------------------------- (Name of Registrant as Specified In Its Charter) CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): [ ] $125 per Exchange Act Rules 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: ----------------------------------------------------------------------- (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: ----------------------------------------------------------------------- [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: ----------------------------------------------------------------------- (2) Form, Schedule or Registration Statement No.: ----------------------------------------------------------------------- (3) Filing Party: ----------------------------------------------------------------------- (4) Date Filed: ----------------------------------------------------------------------- PRELIMINARY COPIES 1996 ANNUAL STOCKHOLDERS MEETING OF CALIFORNIA JOCKEY CLUB 2600 SOUTH DELAWARE STREET SAN MATEO, CALIFORNIA 94403 _________________________ PROXY STATEMENT OF CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE __________________________ This Proxy Statement, the accompanying Letter to Stockholders and the enclosed BLUE proxy card are furnished in connection with the solicitation of proxies by California Jockey Club Shareholders Committee (the "Committee") to be used at the 1996 Annual Stockholders Meeting of California Jockey Club, a Delaware corporation ("CJC"), to be held on August 30, 1996 at 10:00 a.m. Pacific Daylight Time, at the Clubhouse of Bay Meadows Racecourse, 2600 South Delaware Street, San Mateo, California and at any adjournments or postponements thereof (the "Annual Meeting"). At the Annual Meeting, five Directors of CJC will be elected. The Committee is soliciting your proxy in support of the election of the five candidates the Committee intends to nominate (the "Committee Nominees") for election to the Board of Directors of CJC (the "Board"). ALL OF THE COMMITTEE NOMINEES ARE COMMITTED TO PROMOTING CJC'S RETURN TO CONCENTRATION ON ITS CORE BUSINESS--THE CAREFUL AND THOUGHTFUL MANAGEMENT OF THE REAL ESTATE CONSTITUTING THE BAY MEADOWS RACECOURSE. The record date for determining stockholders of CJC entitled to notice of and to vote at the Annual Meeting is August 7, 1996 (the "Record Date"). Stockholders of record at the close of business on the Record Date will be entitled to one vote at the Annual Meeting for each share of CJC Common Stock, $.01 par value per share, held on the Record Date. _________________________ This Proxy Statement, the accompanying Letter to Stockholders and the BLUE proxy card are first being furnished to CJC stockholders on or about August ___, 1996. The office of the Committee is located at 559 Barron Avenue, Palo Alto, California 94306, and its telephone number is (415) 842-4677. THE COMMITTEE The Committee is currently comprised of the following ten individuals: Ashton Cloninger, David Gjerdrum, F. Scott Gross, John C. Harris, Barton D. Heller, Doris Johnson, Noble Threewitt, Jerrylee Vanderhurst, Frank Wipfli and Ronald J. Volkman. All of the foregoing members are collectively referred to in this Proxy Statement as "Committee members." THE COMMITTEE'S AGENDA The Committee considers the incumbent Board members of CJC to have forfeited their right to run the business. In the Committee's view, the incumbent Board has caused antagonism between the interests of CJC and those of Bay Meadows Operating Company ("BMOC") by engaging in foolish land speculation that has jeopardized live racing at BMOC, the gaming and entertainment company currently conducting horse racing at Bay Meadows Racecourse (the "Racecourse"). The Racecourse, consisting of land and horse racing facilities, is CJC's principal asset. As is disclosed in CJC's 1995 Annual Report on Form 10-K (the "CJC 10-K"), CJC has historically derived substantially all of its revenue from its lease of the Racecourse facilities to BMOC for use in connection with Thoroughbred racing, and has no active income-generating business operations of its own. Most recently, the aforementioned land speculation has involved the CJC Board's decisions to sell a portion of the Racecourse consisting of the stable area and training track. The CJC Board has approved these land sales transactions despite the risk that the present operation of the Racecourse will be negatively impacted in the future due to insufficient stable and training track facilities. The CJC Board's entering into these land sales contracts thus jeopardizes, in the Committee's view, live racing at the Racecourse. The CJC Board's actions therefore directly endanger CJC's main historical source of income generated from the rental of the Racecourse to BMOC, and ultimately, imperil the value of each shareholder's investment in CJC. MOREOVER, THE CASH CONSIDERATION TO BE PAID CJC FOR THESE IMPROVIDENT TRANSACTIONS IS, IN THE COMMITTEE'S VIEW, INADEQUATE. ACCORDING TO THE CJC 10-K, THE PROJECTED NET CASH CONSIDERATION TO BE PAID TO CJC ON ACCOUNT OF THESE LAND SALES CONTRACTS IS IN THE AGGREGATE, AT BEST, APPROXIMATELY $49.4 MILLION. THIS IS MORE THAN $8 MILLION BELOW WHAT THE COMMITTEE BELIEVES TO BE THE FAIR MARKET VALUE OF THESE PROPERTIES. THE COMMITTEE'S ESTIMATE OF THE FAIR MARKET VALUE IS BASED, IN PART, ON AN MAI APPRAISAL COMPLETED IN OCTOBER 1995 THAT PROJECTED THE THEN-CURRENT VALUE OF THE LAND COMPRISING THE STABLE AREA AS BEING APPROXIMATELY $600,000 PER ACRE, WITH ESTIMATED APPRECIATION OF UP TO 25% IN TWO TO THREE YEARS. IN ADDITION, THE PROJECTED $8 MILLION SHORTFALL DOES NOT TAKE INTO ACCOUNT THE FOLLOWING ADDITIONAL FACTORS: (1) THE CJC BOARD'S FAILURE AS YET TO OBTAIN APPROPRIATE EXCHANGE PROPERTY TO DEFER THE TAX CONSEQUENCES OF THE SALES; (2) THE COST OF REQUIRED ENVIRONMENTAL REMEDIATION (PER THE CJC 10-K) ASSOCIATED WITH THE SALE OF THE STABLE AREA; (3) THE COST OF OFF-SITE IMPROVEMENTS THAT CJC HAS AGREED (PER THE CJC 10-K) OR MAY AGREE IN THE FUTURE TO PAY; AND (4) THE IMPACT ON THE VALUE OF THE RETAINED LAND OF CJC'S AGREEMENT (PER THE CJC 10-K), AS A PART OF THE LAND SALES TRANSACTIONS, TO CONSTRUCT AND PERMANENTLY MAINTAIN A RETENTION POND. THIS LAST FACTOR ALONE, IN THE COMMITTEE'S VIEW, REDUCES THE FAIR MARKET VALUE OF THE RETAINED LAND BY AS MUCH AS $2 MILLION OR MORE. ACCORDINGLY, THE COMMITTEE BELIEVES THAT WHEN ALL OF THE RELEVANT FINANCIAL CONSIDERATIONS ARE TAKEN INTO ACCOUNT, THE LAND SALES MAY BE AS MUCH AS 25% BELOW THEIR PRESENT FAIR MARKET VALUE. As members of a newly constituted CJC Board of Directors, the Committee Nominees will attempt to reverse the harm created by the current Board's decisions to enter into land sales contracts that jeopardize CJC's income, and therefore, each shareholders' investment in CJC. In this regard, the Committee Nominees would intend to explore the broad options that CJC may presently have to declare void, rescind and/or modify the real estate sales contracts between CJC and the purchasers of its land that the incumbent Board of Directors negotiated. These options are suggested in the text of the CJC 10-K to exist in a variety of circumstances. The Committee Nominees would additionally investigate and vigorously exercise the rights that the Committee believes may exist to set aside such land sales pursuant to section 271 of the Delaware General Corporation Law, which requires a majority of shareholders to approve the sale of all or substantially all of a company's assets. -2- YOUR VOTE IN FAVOR OF THE COMMITTEE NOMINEES WILL PROVIDE YOU, AS THE OWNERS OF CJC, WITH REPRESENTATIVES ON THE BOARD WHO ARE COMMITTED TO PREVENTING ANY FURTHER ENDANGERMENT TO THE BUSINESS AND FUTURE INCOME OF CJC, AND WHO WILL CAREFULLY PROTECT AND MANAGE THE CORE BUSINESS OF CJC: THAT IS, THE LEASING OF REAL ESTATE FOR USE AND OPERATION IN CONNECTION WITH THOROUGHBRED RACING. -3- BACKGROUND AND REASONS FOR THE SOLICITATION AND CERTAIN LEGAL PROCEEDINGS In May 1996, five of the Committee members--Ashton Cloninger, David Gjerdrum, Barton D. Heller, Jerrylee Vanderhurst and Ronald J. Volkman--announced their intent to stand for election to the Board of Directors of CJC at the Annual Meeting, which was at that time scheduled to be convened on June 27, 1996. In response to this perceived threat, CJC and its incumbent Board of Directors--James P. Conn, James M. Harris, Marylin Kyne Gunderson, Richard E. Perazzo, Brian M. Herrera AND Kjell H. Qvale (collectively, the "CJC Board")--canceled the Annual Meeting. In legal proceedings commenced by the above-named Committee members against CJC and the CJC Board (the "Respondents") on July 3, 1996, the Superior Court for the County of San Mateo issued an alternative writ of mandate commanding the Respondents to notice, convene and conduct the Annual Meeting or, in the alternative, to show cause on July 29, 1996 why they have not done so. At the July 29 hearing on the Committee's application for a peremptory writ of mandate, the Court ordered the CJC Board to convene the Annual Meeting on August 30, 1996 to elect directors of CJC. Following the Court's July 29 order that the CJC Board convene the Annual Meeting on August 30, 1996, Ronald J. Volkman, a Committee member and Nominee who is party to the lawsuit, delivered on behalf of the Committee on July 30, 1996 a letter to the Chairman of the CJC Board of Directors, Kjell H. Qvale. In that letter, the full text of which can be found in Exhibit A to this Proxy Statement, Mr. Volkman requested that the incumbent CJC Board take no action before the Annual Meeting that would jeopardize any rights that CJC may presently have not to proceed with the previously announced sales of the stable area and training track owned by CJC on the basis that such transactions require the approval of a majority of CJC stockholders, which the CJC Board has not to date sought or obtained. Mr. Volkman's letter further noted that if the property sales are consummated, CJC would be unable to derive income from a lease supported by live racing on the property, which has been CJC's historic business and primary asset, and accordingly asks that the Board take no further action which might limit CJC's ability to terminate the property sales unless and until the CJC stockholders give their formal approval of the transactions. In the Committee's view, any such sale is illegal unless approved by CJC's stockholders. The Committee is now soliciting your proxy in support of the election of the five Committee Nominees to the CJC Board of Directors at the Annual Meeting on August 30, 1996 so that a new Board consisting of the five Committee Nominees can begin to reverse the harm caused by the CJC Board's negotiation of the property sales which the Committee believes jeopardize CJC's business and income, and furthermore, to begin anew the careful and thoughtful management of CJC's principal asset--the real estate constituting the Bay Meadows Racecourse. IMPORTANT AT THE ANNUAL MEETING, THE COMMITTEE NOMINEES WILL SEEK TO BE ELECTED AS THE DIRECTORS OF CJC. THE COMMITTEE URGES YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY CJC. IF, LIKE US, YOU ARE IN FAVOR OF THE COMMITTEE AGENDA OUTLINED ABOVE, THE COMMITTEE URGES YOU TO MARK, SIGN, DATE AND RETURN THE ENCLOSED BLUE PROXY CARD TO VOTE FOR THE ELECTION OF EACH OF THE COMMITTEE NOMINEES TO THE CJC BOARD OF DIRECTORS. -4- PROPOSAL 1 - ELECTION OF DIRECTORS CJC currently has six directors, each of whose terms is set to expire at the Annual Meeting. The 1996 CJC Proxy Statement (the "CJC Proxy Statement") indicates that the CJC Board has recently decreased the number of Board members by one, for a new total of five directors. The Committee proposes that CJC stockholders elect the five Committee Nominees named below as the directors of CJC at the Annual Meeting. Each Committee Nominee has consented to being named in this Proxy Statement as a nominee and has agreed to serve as a director if elected. If all Committee Nominees are elected, the Committee Nominees will constitute the entire Board of Directors of CJC and will hold office until the 1997 Annual Stockholders Meeting and until a successor has been elected and qualified, or until his earlier death, resignation or removal. In the event that not all of the Committee Nominees are elected to the Board of Directors, however, there can be no assurance that any CJC nominees elected to a Board including the Committee Nominees would agree to serve their term. COMMITTEE NOMINEES FOR DIRECTORS Names of the Committee Nominees, their business experience during the past five years, and certain other biographical information about them are set forth below. In addition, further information about the Committee Nominees is set forth in Schedule I to this Proxy Statement. DAVID GJERDRUM, age 51, has served as President of KERMA, Inc., an electronic marketing and system consulting firm, since 1991. JOHN C. HARRIS, age 52, is owner and Chief Executive Officer of Harris Farms, Inc., a diversified agricultural production and marketing company. Since October 1992, Mr. Harris has been Chairman of the Board and director of Bay Meadows Operating Company, and is also director, President (since April 1996) and past President of California Thoroughbred Breeders Association, and Chairman of the Board of St. Agnes Medical Center in Fresno, California. BARTON D. HELLER, age 58, has served as President of Barons Jewelers since 1967. Mr. Heller earned an A.A. from Oakland City College and a B.A. in Business from San Francisco State University. JERRYLEE VANDERHURST, age 52, has been a real estate agent with Lyon & Associates since 1978. Ms. Vanderhurst earned an A.A. in Business from Sacramento City College. RONALD J. VOLKMAN, age 58, has served as Chairman of the Board and President of ATX, Inc., a real estate development company, since 1991. During the same period, Mr. Volkman has also served as Chairman of the Board of Dallas Pump Service & Supply Co. Inc. and Four Seasons Travel Inc. Mr. Volkman earned a B.S. in Business from the University of San Francisco. It is anticipated that each of the Committee Nominees, upon their election as a director of CJC, will receive director's fees consistent with CJC's past practice. According to the CJC Proxy Statement, directors received an annual fee of $14,000 during 1995. In addition, during 1995, each director was also provided a food and beverage allowance of $1,000 for use by the director and his or her guests in the Directors Room and Turf Club at Bay Meadows Racecourse. The Committee has additionally agreed to indemnify each of the Committee Nominees against any claims and expenses, including legal fees, arising out of their participation in the proxy solicitation for their election. None of the Committee Nominees has been indebted to CJC since the beginning of its last fiscal year, and no family relationships exist between the Committee Nominees and any director or executive officer of CJC. Certain additional information relating to, among other things, the ownership, purchase and sale of securities of CJC by the Committee Nominees, or arrangements with respect thereto, is set forth in Schedule I. -5- The Committee believes that it is in your best interest to elect the Committee Nominees at the Annual Meeting. All Committee Nominees are committed to promoting CJC's return to concentration on its core business--the careful and thoughtful management of the real estate constituting the Bay Meadows Racecourse. THE COMMITTEE STRONGLY RECOMMENDS A VOTE FOR THE ELECTION OF THE COMMITTEE NOMINEES TO THE CJC BOARD OF DIRECTORS. PROPOSAL 2 - TO ESTABLISH A MANDATORY RETIREMENT AGE FOR DIRECTORS Committee Nominee David Gjerdrum, whose stock ownership and address are set forth in Schedule I to this Proxy Statement, and Mr. Sylvester Giacchero, owner of 9,000 shares of CJC Common Stock and whose address is 949 Bristol Avenue, Stockton, California, will present for action at the Annual Meeting, either in person or through an authorized representative, the following resolution: RESOLVED, that effective with the election of directors at the 1996 Annual Stockholders Meeting, the mandatory retirement age for members of the Board of Directors be set at age 72, this to be accomplished by providing that a nominee must be of an age that would not place the nominee at or above the age of 72 prior to the end of his or her term. The foregoing shall only apply to nominees for directors at meetings of shareholders subsequent to the 1996 Annual Stockholders Meeting. Mr. Giacchero and Mr. Gjerdrum have made the following statement in support of their resolution: This proposal seeks from the shareholders of California Jockey Club approval to establish rules for senior management retirement largely symmetrical with those overwhelmingly approved for the Bay Meadows Operating Company at the 1995 meeting. It is reasonably accepted that this change is in the best interest of the California Jockey Club as it provides a vehicle for orderly succession in the stewardship of this public service company. Many public companies have chosen mandatory retirement as a means for assuring the continued pursuit and qualification of candidates for senior positions, and with them the innovation and vigor essential for success in the long term. Just such a change is now due in California Jockey Club. THE COMMITTEE RECOMMENDS A VOTE FOR THE PROPOSAL TO ESTABLISH A MANDATORY RETIREMENT AGE FOR DIRECTORS FOR THE REASONS STATED THEREIN. PROPOSAL 3 - TO RATIFY THE APPOINTMENT OF INDEPENDENT AUDITORS According to the CJC Proxy Statement, stockholders will be asked at the Annual Meeting to ratify the appointment of Deloitte & Touche LLP as independent public accountants for the 1996 fiscal year. The Committee is making no recommendation to shareholders as to how their shares should be voted with respect to this proposal. -6- INTEREST OF THE COMMITTEE MEMBERS IN MATTERS TO BE ACTED UPON As outlined above, five of the Committee members, David Gjerdrum, John C. Harris, Barton D. Heller, Jerrylee Vanderhurst and Ronald J. Volkman, will be Committee Nominees for election to the CJC Board of Directors. VOTING PROCEDURES Stockholders of record of CJC common stock ("CJC Common Stock") as of the Record Date are entitled to one vote for each share of CJC Common Stock held. According to the CJC Proxy Statement, CJC's Certificate of Incorporation provides that a stockholder, or the proxy of such stockholder, may cumulate votes in the election of directors. That is, each stockholder is entitled to the number of votes that is equal to the number of shares owned, multiplied by the number of directors to be elected (five for the Annual Meeting), and may cumulate such votes for a single candidate or distribute such votes among as many candidates as he deems appropriate. Certain affirmative steps must be taken by stockholders of CJC in order to be entitled to vote their shares cumulatively in the election of directors. At a stockholders' meeting at which directors are to be elected, such as the Annual Meeting, no stockholder shall be entitled to cumulate votes for any candidate or candidates unless the candidate's or candidates' names have been placed in nomination prior to the commencement of the voting and a stockholder who appears in person at the meeting has given notice thereat prior to the commencement of the voting of the stockholder's intention to cumulate votes. If any stockholder has given such notice at the Annual Meeting, then every stockholder entitled to vote may cumulate votes for candidates in nomination. The Committee will take those steps necessary to properly place each of the names of the Committee Nominees in nomination for director of CJC and to entitle stockholders to vote their shares cumulatively in the election in accordance with the rules set forth in CJC's Certificate of Incorporation and Bylaws. The CJC Proxy Statement further states that if voting on the election of directors at the Annual Meeting is not conducted by cumulative voting, each stockholder is entitled to cast one vote per share for each of up to five candidates. Whether or not there is cumulative voting on the election of directors, the five candidates receiving the highest number of votes will be elected as directors. Accordingly, broker non-votes and abstentions will not be counted, except, in the case of abstentions, for quorum purposes, and will have no effect on the election of directors. Voting on any other matters to be submitted at the Annual Meeting is noncumulative and a majority of the shares present in person or represented by proxy at the Annual Meeting is required to approve such other matters. In determining whether the requisite majority has been received on any such matter, broker non-votes will not be counted, while abstentions will be counted and will therefore have the same effect as a vote against the matter. The accompanying BLUE proxy card will be voted at the Annual Meeting in accordance with your instructions on such card with respect to Proposals 1, 2 and 3. The Committee is soliciting full discretion and authority from CJC stockholders to vote cumulatively and to allocate votes among any or all of the Committee Nominees. THE COMMITTEE PRESENTLY INTENDS TO GIVE NOTICE OF ITS INTENT TO CUMULATE VOTES FOLLOWING THE REPORT OF THE INSPECTOR OF ELECTION AT THE ANNUAL MEETING. THE COMMITTEE PRESENTLY INTENDS TO CUMULATE VOTES AT THE ANNUAL MEETING IN SUCH A WAY AS TO RESULT IN THE ELECTION OF THE GREATEST NUMBER OF COMMITTEE NOMINEES UNDER THE CIRCUMSTANCES EXISTING AT THAT TIME. You may vote FOR the election of each of the Committee Nominees as directors of CJC or withhold authority to vote for the election of all the Committee Nominees by marking the proper box on the BLUE proxy card. You may also withhold your vote from any one or more of the Committee Nominees by writing the name of such nominee(s) in the space provided on the BLUE proxy card. In addition, you may vote for the establishment of a mandatory retirement age for CJC directors and for ratification of the appointment of Deloitte & Touche LLP as independent auditors, vote against, or abstain from voting on such proposals by marking the proper boxes on the BLUE proxy card. If no marking is made, you will be deemed to have given a direction to vote the shares represented by the BLUE proxy card for the election of all the Committee Nominees, the establishment of a mandatory retirement age for directors, and ratification of the appointment of Deloitte & Touche LLP, provided that you have signed and dated the proxy card. THE COMMITTEE WILL VOTE THEIR -7- SHARES OF CJC COMMON STOCK FOR THE ELECTION OF THE COMMITTEE NOMINEES AND FOR THE ESTABLISHMENT OF A MANDATORY RETIREMENT AGE FOR DIRECTORS. SOLICITATION OF PROXIES Proxies may be solicited by mail, advertisement, telephone or telecopier or in person. Solicitations may be made by members of the Committee, none of whom will receive compensation for such solicitations. The Committee will request banks, brokerage houses and other custodians, nominees and fiduciaries to forward all its solicitation materials to the beneficial owners of shares of CJC Common Stock they hold of record. The Committee will reimburse these record holders for customary clerical and mailing expenses incurred by them in forwarding these materials to their customers. The Committee has retained Georgeson & Company Inc. (the "Agent") for solicitation and advisory services in connection with the solicitation, for which the Agent is to receive total consideration not to exceed $30,000. The Committee has also agreed to advance to the Agent all costs and expenses incidental to solicitation of proxies and to indemnify the Agent against certain liabilities and expenses, including liabilities and expenses under the federal securities laws. The Agent will solicit proxies for the Annual Meeting from individuals, brokers, banks, bank nominees and other institutional holders. It is anticipated that the Agent will employ approximately 20 persons to solicit stockholders for the Annual Meeting. The entire expense of soliciting proxies for the Annual Meeting is being borne by the Committee based, in part, upon contributions the Committee has received. The Committee intends to solicit further contributions to assist in defraying the cost of proxy solicitation. If the Committee Nominees are elected, the Committee intends to seek reimbursement for such expenses from CJC in order to repay any contribution or loan made to the Committee by the Committee members and other participants, but does not expect that the question of such reimbursement will be submitted to a vote of stockholders. Costs incidental to this solicitation of proxies include expenditures for printing, postage, legal, accounting, public relations, advertising and related expenses and are expected to be approximately $100,000. Costs incurred to the date of this Proxy Statement are approximately $80,000. If the Committee should withdraw, or materially change the terms of, this solicitation of proxies prior to the Annual Meeting, the Committee will supplement this Proxy Statement or otherwise publicly disseminate information regarding such withdrawal or change and, in appropriate circumstances, will provide stockholders with a reasonable opportunity to revoke their proxies prior to the Annual Meeting. PROXY PROCEDURES Stockholders are urged to mark, sign and date the enclosed BLUE proxy card and return it to the Committee in the enclosed envelope in time to be voted at the Annual Meeting. Execution of the BLUE proxy card will not affect your right to attend the Annual Meeting and to vote in person, thus revoking your proxy. In addition, any proxy may be revoked at any time prior to the Annual Meeting by delivering a written notice of revocation or a later-dated proxy at the particular meeting. Only your latest dated proxy for the Annual Meeting will count. Only holders of record as of the close of business on the Record Date will be entitled to vote. If you were a stockholder of record on the Record Date, you may vote your shares at the Annual Meeting even if you have sold your shares after the Record Date. Accordingly, please vote the shares held by you on the Record Date, or grant a proxy to vote such shares, on the BLUE proxy card, even if you have sold your shares before or after the Record Date. If any of your shares are held in the name of a brokerage firm, bank, bank nominee or other institution on the Record Date, only it can vote such shares and only upon receipt of your specific instructions. Accordingly, -8- please contact the person responsible for your account and instruct that person to execute on your behalf the BLUE proxy card. OTHER MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING The Committee is not aware of any proposals other than those listed above to be brought before the Annual Meeting. Should any other proposal be brought before the Annual Meeting, the vote required for approval of such proposal would be as prescribed by CJC's charter or bylaws or by applicable law. Generally, approval of a proposal would require a majority of the shares represented at the Annual Meeting and entitled to vote on the matter. Shares voted as abstentions would have the same effect as a negative vote. Shares with respect to which a broker submits a "broker non-vote" on a matter are not counted in calculating the number of shares entitled to vote on a matter and have the effect of reducing the number of votes required for approval of the matter. The grant of the enclosed BLUE proxy card to the Committee will authorize the Committee to vote upon matters not known to the Committee as of the date of this Proxy Statement that arise at the Annual Meeting, matters incident to the conduct of the Annual Meeting, and to vote for any nominee of the Committee whose nomination results from the inability of any of the Committee Nominees to serve on CJC's Board of Directors. CERTAIN ADDITIONAL INFORMATION The CJC Proxy Statement to be distributed by CJC on behalf of the Board of Directors will contain additional information with respect to the number of shares outstanding at the close of business on the Record Date, the CJC Board's nominees for the election of directors and other proposals, the beneficial owners of five percent (5%) or more of the shares of CJC Common Stock, the share ownership of CJC's officers and directors, filings made pursuant to Section 16 of the Securities and Exchange Act of 1934, as amended, the date by which stockholder proposals intended to be submitted at the 1997 Annual Stockholders Meeting must be received by CJC for inclusion in its proxy statement for such meeting, as well as information relating to other matters. Such information, which the Committee has not and will not independently verify, is incorporated by reference in this Proxy Statement in reliance on CJC, except to the extent that such information contradicts information contained in this Proxy Statement or is otherwise adverse to the Committee. The Committee assumes no responsibility for the accuracy or completeness of any information contained herein which is based on, or incorporated by reference to, the CJC Proxy Statement, CJC's Annual Report on Form 10-K or CJC'S other public filings, or Bay Meadows Operating Company's 1996 Proxy Statement (referred to in Schedule I). PLEASE SUPPORT THE COMMITTEE IN OUR EFFORTS TO ELECT THE COMMITTEE NOMINEES TO THE CJC BOARD OF DIRECTORS BY COMPLETING, SIGNING AND DATING THE ENCLOSED BLUE PROXY CARD AND RETURNING IT PROMPTLY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS NECESSARY IF THE ENVELOPE IS MAILED IN THE UNITED STATES. CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE AUGUST __, 1996 -9- SCHEDULE I ADDITIONAL INFORMATION REGARDING COMMITTEE MEMBERS Set forth below is certain information about the Committee members (five of whom are Committee Nominees). Except as set forth in the Proxy Statement or this Schedule I, no Committee member or associate of any Committee member (i) owns beneficially, directly or indirectly, any stock of CJC, (ii) owns any stock of CJC of record, but not beneficially, (iii) within the past two years has purchased or sold any stock of CJC, (iv) has current indebtedness incurred for the purpose of acquiring or holding the stock of CJC referred to in (iii) above, (v) is or has been within the past year a party to any contract, arrangement or understanding with respect to any stock of CJC, (vi) has had since the beginning of CJC's last fiscal year, or is to have, a direct or indirect material interest in any transaction or any proposed transaction, to which CJC or any of its affiliates was or is a party, (vii) has any substantial interest in any matter anticipated at this time to be acted upon at the Annual Meeting, (viii) has any arrangement or understanding with respect to future employment with CJC or any of its affiliates, or (ix) has any arrangement or understanding with respect to future transactions to which CJC or any of its affiliates will or may be a party. BACKGROUND INFORMATION NAME AND OCCUPATION NAME OF EMPLOYER AND BUSINESS ADDRESS Ashton Cloninger Ashton Cloninger, DVM Veterinarian P.O. Box 582 Belmont, CA 94002 David Gjerdrum KERMA, Inc. President, electronic marketing and 559 Barron Avenue system consulting company Palo Alto, CA 94306 F. Scott Gross Primus Management, Inc. Chairman and Chief Executive Officer, 111 Sutter Street, #2150 hospital management, real estate San Francisco, CA 94104 ownership and financial advisory company John C. Harris Harris Farms Chief Executive Officer, agricultural Route 1, Box 420 production and marketing company Coalinga, CA 93210 Barton D. Heller Barons Jewelers Jeweler 134 Bayfair Mall San Leandro, CA 94578 Doris Johnson N/A Retired Noble Threewitt 9138 Arcadia Avenue Thoroughbred Horse Trainer San Gabriel, CA 91775 Jerrylee Vanderhurst Lyon & Associates Realtors Real Estate Agent 2801 "J" Street Sacramento, CA 95816 S-I-1 Ronald J. Volkman ATX, Inc. Chairman of the Board and President, 792 JENEVEIN Avenue real estate development company San Bruno, CA 94066 Frank Wipfli Western Saddlery Inc. General Manager, animal health J.A.M. Importers & Exporters, Inc. products wholesaler/retailer 7038 Commerce Circle, company Pleasanton, CA 94588 BENEFICIAL OWNERSHIP OF SHARES The Committee members have provided the information set forth in the table below with regard to the shares of CJC Common Stock beneficially owned by each of them as of July 26, 1996. The Committee collectively owns a total of 251,542 shares and believes that there were a total of 5,763,257 shares of CJC Common Stock outstanding as of May 16, 1996 (based on the BMOC 1996 Proxy Statement (the "BMOC Proxy Statement"), which states that as of that date, 5,763,257 shares of BMOC common stock ("BMOC Common Stock"), which is paired on a one-to-one basis with CJC Common Stock, were outstanding). Shares Percentage Beneficially Beneficially Name owned owned ---- ------------ ------------ Ashton Cloninger . . . . . . . . . . . . . . . . 55 * David Gjerdrum(1). . . . . . . . . . . . . . . . 24,010 * F. Scott Gross(2). . . . . . . . . . . . . . . . 3,000 * John C. Harris . . . . . . . . . . . . . . . . . 71,245 1.2% Barton D. Heller . . . . . . . . . . . . . . . . 7,000 * Doris Johnson(3) . . . . . . . . . . . . . . . . 33,091 * Noble Threewitt. . . . . . . . . . . . . . . . . 500 * Jerrylee Vanderhurst(4). . . . . . . . . . . . . 34,541 * Ronald J. Volkman. . . . . . . . . . . . . . . . 1,000 * Frank Wipfli . . . . . . . . . . . . . . . . . . 78,000 1.4 ____________________ * Amount represents less than one percent (1%) of the CJC Common Stock. (1) Includes 24,000 shares held in a testamentary trust of which Mr. Gjerdrum is a residual beneficiary and pursuant to which he will receive approximately 8,000 shares upon the demise of his mother. (2) Includes 2,000 shares held by the Siena Investment Group Trust, of which Mr. Gross, his wife and children are the beneficiaries. (3) All 33,090 shares are held by the Johnson Family Trust of which Ms. Jerrylee Vanderhurst is trustee. (4) All 34,541 shares are held by the Johnson Family Trust of which Ms. Jerrylee Vanderhurst is trustee. S-I-2 STOCK TRANSACTIONS WITHIN THE PAST TWO YEARS The following table sets forth with respect to all shares of CJC purchased or sold within the past two years by the Committee members, the date on which such shares were purchased or sold, and the amount purchased or sold on such date. DAVID GJERDRUM NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 01/08/96 10 0 F. SCOTT GROSS NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 11/30/95 1,000 0 12/15/95 1,000 07/30/96 1,000 JOHN C. HARRIS NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 08/17/94 2,000 0 08/24/94 1,000 08/26/94 1,000 09/07/94 1,000 09/23/94 300 10/03/94 1,200 04/25/94 1,500 12/09/94 1,000 04/21/95 1,000 05/05/95 500 08/08/95 1,000 10/17/95 1,000 10/31/95 200 11/01/95 300 11/02/95 300 01/19/96 1,000 S-I-3 DORIS JOHNSON NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 12/30/94 300 0 07/17/95 200 08/17/95 100 12/07/95 200 01/04/96 100 01/18/96 90 RONALD J. VOLKMAN NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 05/08/96 100 0 06/18/96 900 JERRYLEE VANDERHURST NUMBER OF SHARES ---------------- DATE PURCHASED SOLD ---- --------- ---- 12/14/95 20 0 07/31/95 50 11/16/95 50 01/04/96 20 S-I-4 PRINCIPAL STOCKHOLDERS The following table sets forth certain information with respect to each person who is known by the Committee to own beneficially more than five percent (5%) of CJC's Common Stock. SHARES PERCENTAGE BENEFICIALLY BENEFICIALLY NAME OWNED OWNED ---- ------------ ------------ "Gabelli Group"(1). . . . . . . . . . . . . . . . . 420,000 7.3% One Corporate Center Rye, NY 10580-1435 David H. Lesser/Hudson Bay Partners, L.P.(2). . . . 288,300 5.0 2 West 45th Street, Suite 908 New York, NY 10036 ________________________________________ (1) Based on the BMOC Proxy Statement, which sets forth all those known by BMOC to be beneficial owners as a group of more than five percent (5%) of the BMOC Common Stock (which, as explained above under the caption "--Beneficial Ownership of Shares," is paired on a one-to-one basis with CJC Common Stock), the Committee believes that as of April 30, 1996, the "Gabelli Group" owned 420,000 shares of CJC Common Stock. According to the BMOC Proxy Statement, the Gabelli Group is comprised of Gabelli Funds, Inc., GAMCO Investors, Inc., Gabelli & Company, Inc., Gabelli International Limited II, Gabelli Performance Partnership, Gabelli International Limited, and Mario Gabelli. The BMOC Proxy Statement does not disclose the address for the "Gabelli Group." (2) According to a Schedule 13D filed jointly by David H. Lesser and Hudson Bay Partners, L.P. ("Hudson Bay") on July 18, 1996, Mr. Lesser has sole voting and dispositive power with respect to 12,800 shares of CJC Common Stock owned of record by him, and Hudson Bay owns of record 275,500 shares of CJC Common Stock, over which Mr. Lesser and Hudson Bay may be deemed to share voting and dispositive power by virtue of the fact that Mr. Lesser is the President, sole director and sole shareholder of Hudson Bay Partners, Inc., the general partner of Hudson Bay. However, Mr. Lesser expressly disclaims beneficial ownership of any shares not directly owned by him. S-I-5 SCHEDULE II INFORMATION REGARDING OTHER PARTICIPANTS Set forth below is certain information about the additional participant, as defined under applicable federal securities laws based on his contribution of $500 or more to finance the cost of proxy solicitation. Except as set forth in this Schedule II, neither the additional participant, Mr. George D. Andros, nor any associate of his, (i) owns beneficially, directly or indirectly, any stock of CJC, (ii) owns any stock of CJC of record, but not beneficially, (iii) within the past two years has purchased or sold any stock of CJC, (iv) has current indebtedness incurred for the purpose of acquiring or holding the stock of CJC referred to in (iii) above, (v) is or has been within the past year a party to any contract, arrangement or understanding with respect to any stock of CJC, (vi) has had since the beginning of CJC's last fiscal year, or is to have, a direct or indirect material interest in any transaction or any proposed transaction, to which CJC or any of its affiliates was or is a party, (vii) has any substantial interest in any matter anticipated at this time to be acted upon at the Annual Meeting, (viii) has any arrangement or understanding with respect to future employment with CJC or any of its affiliates, or (ix) has any arrangement or understanding with respect to future transactions to which CJC or any of its affiliates will or may be a party. BACKGROUND INFORMATION AND BENEFICIAL OWNERSHIP OF SHARES Mr. George D. Andros is presently retired, owns 100 shares of CJC Common Stock and has not purchased or sold any shares of CJC Common Stock within the last two years. S-II-1 EXHIBIT A MR. RON VOLKMAN 792 JENEVEIN AVENUE SAN BRUNO, CA 94066 July 30, 1996 HAND DELIVERED Mr. Kjell H. Qvale Chairman of the Board of Directors California Jockey Club c/o British Motors 901 Van Ness Avenue San Francisco, CA 94109 Dear Mr. Qvale: As you doubtless are aware, the San Mateo County Superior Court yesterday ordered California Jockey Club ("CJC") to hold an annual meeting of shareholders on August 30, 1996 to elect a new Board of Directors. Pending this election, I write today on behalf of the California Jockey Club Shareholders Committee to request that the incumbent Board take no action that would jeopardize any rights CJC may presently have not to proceed with the previously announced sales of the stable area and training track (the "Proposed Transactions"). The Proposed Transactions may not be consummated without shareholder approval because they involve the sale or exchange of substantially all of CJC's property and assets. If these sales were consummated, CJC would be unable to continue to derive income from a lease supported by live racing on the property. This of course has been CJC's historic business and primary asset. Moreover, we have reason to believe that Property Resources, Inc. ("PRI") has warned Bay Meadows Operating Company against even attempting to make changes in the use and operation of the Bay Meadows Racecourse to accommodate live racing after the sale to PRI. Consummation of the Proposed Transactions thus requires the affirmative vote of the holders of a majority of the outstanding stock of CJC pursuant to section 271 of the Delaware General Corporation Law. Notwithstanding this clear legal requirement, CJC management has entered into contracts calling for consummation of the Proposed Transactions without having sought or obtained the requisite shareholder approval. CJC presently has rights not to proceed with the Proposed Transactions. Any further steps that the incumbent Board might take that would compromise CJC's rights in this regard thus would constitute a breach of the Board's duty of care. Accordingly, we ask that you and the Board state publicly that until such time, if any, as the Proposed Transactions are formally approved by CJC stockholders, you will take no action that limits CJC's ability to avoid these illegal transactions and their harmful effects. Very truly yours, /s/ Ronald J. Volkman Ronald J. Volkman ENC. cc: CJC Board of Directors (via regular mail) E-1 IMPORTANT YOUR PROXY IS IMPORTANT. NO MATTER HOW MANY SHARES OF CJC COMMON STOCK YOU OWN, PLEASE GIVE THE COMMITTEE YOUR PROXY FOR THE ELECTION OF THE COMMITTEE NOMINEES BY: MARKING THE ENCLOSED BLUE PROXY CARD, SIGNING THE ENCLOSED BLUE PROXY CARD, DATING THE ENCLOSED BLUE PROXY CARD AND MAILING THE ENCLOSED BLUE PROXY CARD TODAY IN THE ENVELOPE PROVIDED (NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES). IF YOU HAVE ALREADY SUBMITTED A PROXY TO CJC FOR THE ANNUAL MEETING, YOU MAY CHANGE YOUR VOTE TO A VOTE FOR THE ELECTION OF THE COMMITTEE NOMINEES BY MARKING, SIGNING, DATING AND RETURNING THE ENCLOSED BLUE PROXY CARD, WHICH MUST BE DATED AFTER ANY PROXY YOU MAY HAVE SUBMITTED TO CJC. ONLY YOUR LATEST DATED PROXY FOR THE ANNUAL MEETING WILL COUNT AT THE ANNUAL MEETING. IF YOU HAVE ANY QUESTIONS OR REQUIRE ANY ADDITIONAL INFORMATION CONCERNING THIS PROXY STATEMENT, PLEASE CONTACT GEORGESON & COMPANY INC. AT THE ADDRESS OR TELEPHONE NUMBER SET FORTH BELOW. IF ANY OF YOUR SHARES ARE HELD IN THE NAME OF A BROKERAGE FIRM, BANK NOMINEE OR OTHER SUCH INSTITUTION, ONLY IT CAN VOTE SUCH SHARES AND ONLY UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS. ACCORDINGLY, PLEASE CONTACT THE PERSON RESPONSIBLE FOR YOUR ACCOUNT AND INSTRUCT THAT PERSON TO EXECUTE THE BLUE PROXY CARD. GEORGESON & COMPANY INC. WALL STREET PLAZA NEW YORK, NY 10005 TELEPHONE (TOLL-FREE): (800) 223-2064 PROXY CARD CALIFORNIA JOCKEY CLUB 1996 ANNUAL STOCKHOLDERS MEETING THIS PROXY IS SOLICITED BY CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE The undersigned stockholder of California Jockey Club ("CJC") hereby appoints each of DAVID GJERDRUM, JOHN C. HARRIS and RONALD J. VOLKMAN, and each of them with full power of substitution, for and in the name of the undersigned, to represent and to vote, as designated below, all shares of common stock of CJC that the undersigned is entitled to vote if personally present at the 1996 Annual Stockholders Meeting of CJC, and at any adjournment or postponement thereof. The undersigned hereby revokes any previous proxies with respect to the matters covered by this Proxy. CALIFORNIA JOCKEY CLUB SHAREHOLDERS COMMITTEE RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2. (Please mark with an "X" in the appropriate box) 1. ELECTION OF THE COMMITTEE NOMINEES TO THE CJC BOARD OF DIRECTORS: Election of David Gjerdrum, John C. Harris, Barton D. Heller, Jerrylee Vanderhurst, and Ronald J. Volkman. /__/ FOR all nominees /__/ WITHHOLD AUTHORITY except as marked below for all nominees (INSTRUCTION: To withhold authority to vote for one or more nominees, mark FOR above and print the name(s) of the person(s) with respect to whom you wish to withhold authority in the space provided below.) - -------------------------------------------------------------------------------- 2. TO ESTABLISH A MANDATORY RETIREMENT AGE FOR DIRECTORS Establishing the age of 72 as the mandatory retirement age for CJC directors. /__/ FOR /__/ AGAINST /__/ ABSTAIN 3. TO RATIFY THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS INDEPENDENT AUDITORS Ratifying the appointment of the firm of Deloitte & Touche LLP as independent public accountants for 1996. /___/ FOR /___/ AGAINST /___/ ABSTAIN 4. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF. PLEASE MARK, SIGN DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE PROVIDED. This Proxy, when properly executed, will be voted in the manner marked herein by the undersigned shareholder. IF NO MARKING IS MADE, THIS PROXY WILL BE DEEMED TO BE A DIRECTION TO VOTE FOR PROPOSALS 1, 2 and 3. Please date and sign this proxy exactly as your name appears as a stockholder of CJC. If shares are registered in more than one name, the signatures of all such persons are required. A corporation should sign its full corporate name by a duly authorized officer, stating his/her title. Trustees, guardians, executors and administrators should sign in their official capacity, giving their full title as such. If a partnership or limited liability company, please sign in the partnership or limited liability company name by authorized persons. __________________________________ ___________________________________ ( Print Name) (Title, if applicable) __________________________________ Dated:______________________________ (Signature) __________________________________ ____________________________________ (Print name of joint holder, (Title, if applicable) if applicable) __________________________________ Dated:______________________________ (Signature of joint holder, if applicable) -----END PRIVACY-ENHANCED MESSAGE-----