<PAGE>

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

                                    FORM 10-K


                [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                         COMMISSION FILE NUMBER: 0-33007

                               JCC HOLDING COMPANY
             (Exact name of registrant as specified in its charter)


             Delaware                                  62-1650470
             --------                                  ----------
   (State or other jurisdiction                      (IRS employer
         of incorporation)                       identification number)

                                 ONE CANAL PLACE
                           365 CANAL STREET, SUITE 900
                          NEW ORLEANS, LOUISIANA 70130
                          ----------------------------
                    (Address of principal executive offices)


                                 (504) 533-6000
                         (Registrant's telephone number)

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

    TITLE OF EACH CLASS                              NAME OF EACH EXCHANGE ON
                                                     WHICH REGISTERED
--------------------------------------------------------------------------------
    Common Stock, par value $0.01 per share          OTC Bulletin Board


           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                      None

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

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



                                       1
<PAGE>

         The aggregate market value of the Common Stock held by non-affiliates
of the registrant was $6,665,234 at March 1, 2002, based on the closing sale
price of $2.00 per share for the Common Stock on such date on the
Over-the-Counter Bulletin Board trading system.

         Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [X] No [ ].

         As of March 1, 2002, the number of shares of our Common Stock
outstanding was 12,386,200.

         On March 19, 2001 the United States Bankruptcy Court for the Eastern
District of Louisiana confirmed our Plan of Reorganization (the "Plan of
Reorganization") which, among other things, resulted in the elimination of all
of our outstanding shares of class A common stock and class B common stock upon
the effective date of the Plan of Reorganization, which was March 29, 2001. A
copy of the Plan of Reorganization was filed on March 29, 2001, with the SEC as
part of our Form 8-K filing concerning the approval of the bankruptcy proceeding
(which filing is incorporated herein by reference).

                       DOCUMENTS INCORPORATED BY REFERENCE

         Specifically identified portions of the Proxy Statement for the 2002
Annual Meeting of Stockholders to be held on April 25, 2002, are incorporated by
reference in Part III.




                                       2
<PAGE>
                               JCC HOLDING COMPANY

                           ANNUAL REPORT ON FORM 10-K
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001

                                TABLE OF CONTENTS


<Table>
<Caption>

 ITEM                                                                                                 PAGE
NUMBER                                                                                               NUMBER
------                                                                                               ------

<S>                                                                                                  <C>
                                                    PART I

   ITEM 1.      DESCRIPTION OF THE BUSINESS..............................................................4

   ITEM 2.      PROPERTIES..............................................................................16

   ITEM 3.      LEGAL PROCEEDINGS.......................................................................17

   ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.....................................17


                                                    PART II

   ITEM 5.      MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS...............17

   ITEM 6.      SELECTED FINANCIAL DATA.................................................................19

   ITEM 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
                OF OPERATIONS...........................................................................20

   ITEM 7A.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK..............................33

   ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.............................................33

   ITEM 9.      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
                DISCLOSURE..............................................................................72


                                                   PART III

   ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT......................................72

   ITEM 11.     EXECUTIVE COMPENSATION..................................................................72

   ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT..........................72

   ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..........................................72


                                                    PART IV

   ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.........................72
</Table>




                                       3
<PAGE>





                                     PART I

ITEM 1. DESCRIPTION OF THE BUSINESS.

         SPECIAL CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

         This annual report of JCC Holding Company ("JCC Holding") on Form 10-K
includes forward-looking statements made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995, including in particular
the statements about (1) our plans, objectives, expectations and prospects, (2)
the development of non-gaming entertainment space on the second floor of the
casino in New Orleans, Louisiana and of various adjacent properties for
entertainment and other uses supporting the casino, and (3) the development and
implementation of a plan for expanded buffet and dining facilities and other
amenities for our patrons to the extent now permitted by applicable
restrictions. In particular, such statements appear under the heading "Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations" in this document. The words "expect," "anticipate," "intend,"
"plan," "believe," "seek," "estimate" and similar expressions identify
forward-looking statements. Although we believe that the plans, objectives,
expectations and prospects reflected in or suggested by such forward-looking
statements are reasonable, such statements involve uncertainties and risks, and
we cannot be certain that such plans, objectives, expectations and prospects
will be achieved. Important factors that could cause actual results to differ
materially from the results anticipated by the forward-looking statements
include such matters as:

         o        our ability to achieve sufficient revenues under our Plan of
                  Reorganization to meet our reduced but continuing obligations
                  to the State of Louisiana, the City of New Orleans and our
                  various other creditors, including, in particular, our minimum
                  required annual payment to the State of Louisiana in the
                  amount of the greater of (i) $50 million (increased to $60
                  million beginning April 1, 2002 and continuing for each casino
                  operating contract fiscal year thereafter during the term of
                  the casino operating contract) or (ii) the sum of a sliding
                  scale of gross gaming revenues that begins at 21.5% for gross
                  gaming revenues up to $500 million and escalates to a high of
                  29% for revenues in excess of $900 million.

         o        our ability to compete successfully with riverboat gaming
                  operations in our market area which are now permitted to
                  remain dockside without the requirement of periodically
                  traveling offshore; and

         o        our ability to develop a sufficiently effective marketing plan
                  to succeed in operating in a weakened national economy, a
                  weakened convention and leisure travel market and an
                  increasingly competitive local and regional gaming marketplace
                  in which we also compete with other entertainment
                  alternatives.

All written or oral forward-looking statements attributable to us are expressly
qualified in their entirety by these cautionary statements.

                                   THE COMPANY

GENERAL

         We are a casino and entertainment company. We operate a land-based
casino entertainment facility (the "Casino") in downtown New Orleans, Louisiana,
which opened for business on October 28, 1999, at the foot of Canal and Poydras
Streets on the site of New Orleans' former Rivergate convention center. Pursuant
to a casino operating contract dated October 30, 1998 among Jazz Casino Company,
L.L.C. which operates the Casino, Harrah's Jazz Company (now dissolved) and the
State of Louisiana, through the Louisiana Gaming Control Board, we were granted
the exclusive right to operate the Casino in Orleans Parish.

         JCC Holding was incorporated on August 20, 1996, in anticipation of
assuming the business formerly owned by Harrah's Jazz Company, which had filed
for bankruptcy in November 1995. We conduct business through our wholly-owned
subsidiaries, Jazz Casino Company, L.L.C., a Louisiana limited liability company
("Jazz Casino"), JCC Development Company, L.L.C., a Louisiana limited liability
company ("JCC Development"), JCC Canal Development, L.L.C., a Louisiana limited
liability company ("Canal Development"), and JCC Fulton




                                       4
<PAGE>

Development, L.L.C., a Louisiana limited liability company ("Fulton
Development"). We filed for bankruptcy protection in January 2001 and emerged in
March 2001, as further described immediately below. Except as otherwise noted,
for purposes of this report, the words "we," "us" and "our" refer to JCC Holding
Company together with each of its subsidiaries. Our principal executive offices
are located at One Canal Place, 365 Canal Street, Suite 900, New Orleans,
Louisiana 70130, and our telephone number is (504) 533-6000.

JCC HOLDING BANKRUPTCY PROCEEDINGS

         In July 2000, we engaged the services of the investment banking firm of
Jefferies & Company ("Jefferies") to assist us in evaluating ways to restructure
our financial obligations as we realized that, based on our operating losses, we
would need to reorganize in order to remain in business. In September 2000, the
Mayor of the City of New Orleans appointed a tax advisory committee to review
the financial condition of the Casino and advise him on the financial viability
of the Casino and its economic impact on the city. Based on Jefferies' advice,
in November 2000 we presented a proposal for restructuring our financial
obligations to the tax advisory committee. The proposal recommended, among other
things, a pre-negotiated bankruptcy proceeding to achieve a reorganization of
our financial arrangements and existing capital structure.

         On January 4, 2001 (the "Petition Date"), we filed voluntary petitions
for relief under Chapter 11 of the U.S. Bankruptcy Code in order to allow
restructuring of our obligations to the State of Louisiana and the City of New
Orleans, long-term debt, bank credit facilities, and trade and other
obligations. The filing was made in the U.S. Bankruptcy Court for the Eastern
District of Louisiana in New Orleans (the "Bankruptcy Court"). After the
Petition Date, we continued to operate as debtors-in-possession subject to the
Bankruptcy Court's supervision and orders.

         The bankruptcy petitions were filed in order to give us the opportunity
to restructure our debt and other obligations. Our Plan of Reorganization filed
with the Bankruptcy Court on February 8, 2001, set forth the means for
satisfying claims, including reductions of our liabilities subject to
compromise, and cancellation of equity interests in JCC Holding. The Plan of
Reorganization was approved by the Bankruptcy Court on March 19, 2001 and was
effective March 29, 2001. Consummation of this plan resulted in, among other
things, elimination of all our common stock existing prior to the effective date
of our Plan of Reorganization and the issuance of new equity and debt securities
to creditors. In accordance with the Plan of Reorganization we issued, effective
on March 29, 2001, 12,386,200 shares of new common stock ("Common Stock") and
$124,519,758 of senior notes due 2008 ("Senior Notes") to certain of our
creditors, including Harrah's Entertainment, Inc. ("Harrah's Entertainment" or
"HET") and affiliates, in consideration of their consent to cancellation and/or
reduction of claims against us in connection with certain agreements.

         Pursuant to Section 365 of the U.S. Bankruptcy Code, we had the right
to assume or reject executory contracts or unexpired leases, and did so in
certain instances in connection with our Plan of Reorganization. We did not
reject any executory contracts or unexpired leases material to our business
operations.

         This report should be read in light of our bankruptcy proceeding and
Plan of Reorganization. The full Plan of Reorganization and related Disclosure
Statement were filed with the SEC as part of our Form 8-K filing concerning the
approval of the bankruptcy proceeding, on March 29, 2001 (which filing is
incorporated herein by reference).

THE CASINO

         The Casino consists of 196,000 square feet on its first floor, 100,000
square feet of which is gaming space in five themed areas named The Jazz Court,
The Mardi Gras Court, The Smuggler's Court, The Court of the Mansion and The
Court of Good Fortune. The remaining space is used for a food service area with
a 250 seat buffet and a 50 seat restaurant, casino support facilities, and
multi-function, special event and meeting-room space. The second floor of the
Casino, which is subleased by Jazz Casino to JCC Development, has not yet been
developed. Parking for approximately 400 cars and approximately 145,000 square
feet of back-of-house and support areas are provided in the basement level of
the Casino under the main gaming floor. Across Poydras Street and connected to
the Casino by an underground tunnel are two parking facilities that together
contain approximately 1,550 parking spaces.



                                       5
<PAGE>

         The Casino has approximately 2,500 slot machines and 102 table games,
including live poker, blackjack, craps, roulette and baccarat. The gaming
activities that may be conducted at the Casino, subject to the rule-making
authority of the Louisiana Gaming Control Board, include any banking or
percentage game that is played with cards, dice or any electronic, electrical or
mechanical device or machine for money, property or any thing of value. The
Casino, however, may not offer lotteries, bingo, wagering on dog or horse races,
sports betting or wagering on any type of sports contest or event. The Casino is
open 24 hours a day, 365 days a year and can extend credit, with no loss or
wagering limits.

         As funding and circumstances may permit, we plan to expand our existing
buffet to 400 seats, develop a full-service restaurant with seating for 150
people, develop approximately 130,000 square feet of multipurpose non-gaming
entertainment space on the second floor of the Casino and develop various
adjacent properties for entertainment uses supporting the Casino. We have not
obtained financing to fund these developments, and cannot assure that we will
ever obtain such funding.

DESCRIPTION OF THE MANAGER

         On October 29, 1998, Jazz Casino and Harrah's New Orleans Management
Company (the "Manager") entered into an agreement pursuant to which Jazz Casino
engaged the Manager to manage the operations of the Casino. This management
agreement was amended and restated in connection with our Plan of
Reorganization. The Manager is an indirect wholly-owned subsidiary of Harrah's
Entertainment, Inc. and was formed in May 1993 for the purpose of acting as the
manager of the Casino. Harrah's Entertainment's casino business began operations
more than 60 years ago and, through its operating subsidiaries and other
affiliates, Harrah's Entertainment currently operates casino entertainment
facilities in 12 states under the Harrah's, Showboat, Rio and Harveys brand
names.

Under the management agreement, subject to certain budgetary constraints, the
Manager is responsible for and has authority over, among other things:

         o        hiring, supervising and establishing labor policies with
                  respect to employees working in the Casino;

         o        gaming and entertainment policies and operations including
                  security and internal control procedures;

         o        advertising, marketing and promoting the Casino;

         o        providing Casino-level accounting and budgeting services;

         o        maintaining, renovating and improving the Casino;

         o        performing certain system services generally performed at
                  casinos owned or managed by Harrah's Entertainment or its
                  affiliates; and

         o        performing certain other functions identified by Jazz Casino
                  and agreed to by the Manager.

         During the term of the management agreement, Jazz Casino is required to
fund the cost of operating the Casino and is responsible for, among other
things:

         o        approving budgets presented by the Manager;

         o        maintaining Jazz Casino's leasehold interest in the Casino's
                  premises, free from encumbrances other than those set forth as
                  exceptions in the title policy covering the Casino's premises;

         o        obtaining and maintaining all licenses and permits required to
                  own and operate the Casino and handling governmental affairs;

         o        developing, leasing and financing the second floor of the
                  Casino;



                                       6
<PAGE>

         o        complying with certain minority, women and disadvantaged
                  persons hiring requirements;

         o        paying indebtedness encumbering the Casino;

         o        handling all community and public relations, except
                  advertising, marketing and promotions;

         o        establishing and administering employee benefit plans and
                  other employee benefit matters;

         o        assisting the Manager with any matters delegated to the
                  Manager if requested in writing by the Manager and agreed to
                  by Jazz Casino; and

         o        handling all corporate, administrative and other business
                  activities of Jazz Casino and any other matters not expressly
                  delegated to the Manager under the management agreement.

         Under the management agreement, the Manager is entitled to receive a
management fee equal to 30 percent of earnings before interest, income taxes,
depreciation, amortization and management fees ("EBITDAM"). This management fee
entitles us to the services described above. In addition, a portion of this fee
may be designated as a marketing contribution that can be used for advertising
services, special promotions, public relations and other marketing services.
Harrah's Entertainment affiliates may pool the marketing contribution with
contributions made by other participating casinos owned or managed by Harrah's
Entertainment affiliates. In addition, Jazz Casino is required to reimburse
Harrah's Entertainment for the cost of property level executive salaries, and
for insurance related to the Casino. Neither the Manager nor any of its
affiliates is entitled to receive fees for services previously provided under
our administrative services agreement, which services must now be provided at no
additional cost. These services include computer processing, payroll, marketing
teleservices, and administering certain employee benefit packages.

         The management agreement also provides, among other things, that
neither the Manager nor Jazz Casino nor any of their affiliates controlled by
the Manager's ultimate parent or Jazz Casino's ultimate parent, as the case may
be, can develop, own, finance or manage a casino or other gaming operations in
Orleans, Plaquemines, St. Charles, St. Tammany, Jefferson or St. Bernard
Parishes, Louisiana, except for the Casino.

         In June 2001, in order to reduce our expenses through the consolidation
of duplicative functions, our board of directors agreed to release Fred Keeton
from his position with us as Vice President of Community Relations and
Governmental Affairs, permitting him to become an employee of HET. Mr. Keeton
would continue his involvement in some governmental relations matters on our
behalf at a reduced cost to us.

MARKETING STRATEGY

         Our marketing strategy is designed to attract primarily a broad "middle
market" of local and regional gamers, national in-market tourists and Harrah's
customers from across the country. We use marketing material emphasizing the
Casino as a total entertainment destination, leveraging New Orleans' music,
food, history, architecture and spirit. Additionally, under the terms of our
ground lease with the Rivergate Development Corporation and the City of New
Orleans for the site on which the Casino is located, as amended in connection
with our bankruptcy proceeding, we pay the City of New Orleans $1.5 million per
year to market and promote the Casino as a part of its destination marketing
program. The Rivergate Development Corporation is a public benefit corporation
formed for the purpose of subleasing to us the site in New Orleans designated by
law for the Casino's location.

COMPETITION

         We face significant competition on a regional and local scale from
gaming operations in Mississippi and Louisiana. The Casino competes for patrons
on a national scale with large casino hotel facilities in Las Vegas, Nevada and
Atlantic City, New Jersey. Because of the large number of casinos competing on
both the local and



                                       7
<PAGE>

national levels and the continued development of other gaming markets, the
competition facing the Casino is expected to increase.

         The terms of the Louisiana Economic Development and Gaming Corporation
Act and the Louisiana Gaming Control Act (collectively, the "Gaming Act") and
the rules and regulations promulgated thereunder were amended in connection with
our Plan of Reorganization. The Gaming Act and its rules and regulations in
effect subsequent to the effectiveness of our Plan of Reorganization, now allow
us as part of our casino operations to:

         o        directly own and operate a full-service restaurant with
                  seating limited to 150 seats;

         o        expand our limited cafeteria style seating from 250 to 400
                  seats;

         o        cater certain functions within the Casino;

         o        lease space to area restaurant owners in a food court with
                  seating limited to 100 seats;

         o        lease space to third parties to operate two restaurants on the
                  second floor with a total of 350 seats;

         o        offer and advertise limited complimentary and discount food
                  offerings to certain specified persons; and

         o        buy, lease, or build a hotel with 450 rooms.

         Prior to these amendments to State law, we were not allowed to operate
a hotel, obtain preferred pricing with any particular hotel or offer seated
dining for our patrons with table service. Even with the amendments, we are
still restricted from freely offering complimentary or discounted lodging or
food to the general public except under limited circumstances.

         Certain amendments to our ground lease and general ordinances of the
City also made in connection with our reorganization reduced restrictions on our
food and lodging operations to mirror current restrictions imposed by the State
of Louisiana.

         The vast majority of our competitors operate without the restrictions
on lodging, food services and entertainment that apply to us. We believe that
the ability to provide such amenities without such restrictions is a
considerable advantage for our competitors.

         MISSISSIPPI. We compete on a national, regional and local scale for
visitors with existing gaming facilities in Mississippi. The Mississippi Gulf
Coast has become a major gaming destination. There are currently 12 dockside
casinos operating on the Mississippi Gulf Coast that are within 100 miles of New
Orleans. In addition, there is substantial growth in Mississippi's Gulf Coast
gaming industry, including significant expansions of hotel and convention space
and the addition of golf courses. For example, an 1,800 room hotel, resort and
dockside casino opened in Biloxi in March 1999 that is larger than any hotel in
New Orleans. Approximately $600 million was spent to develop this resort and due
to its size and amenities, it provides significant competition to the Casino.
Mississippi law allows dockside gaming and does not limit the number of casinos
or the square feet of gaming space in these facilities. Mississippi has recently
promulgated a regulation, however, that requires new entrants in the industry to
spend certain amounts of money on non-gaming facilities in addition to the
casino boat itself. Unlike the Casino, gaming facilities in Mississippi operate
with no restrictions on lodging, food and beverage service, and entertainment,
and several of such facilities have recently expanded to enhance such services.

         LOUISIANA. We currently have the exclusive right to operate a
land-based casino in Orleans Parish. In authorizing the operation of a single,
official land-based gaming establishment, the Louisiana legislature intended to
promote economic development and maintain public confidence in the integrity of
casino gaming operations in a manner that ensures that the owner or operator of
the casino has no incentive to (1) divert or skim revenues, (2) engage in
illegal activities or reduce competition from other gaming entities, or (3)
conduct land-based gaming operations so as to prevent guests from patronizing
local businesses other than the official gaming establishment.



                                       8
<PAGE>

The legislature further determined that by authorizing only a single, land-based
casino, all persons involved with the casino gaming operation, including
manufacturers, suppliers, and distributors of certain gaming devices and
equipment, could be licensed, regulated, and controlled in such a manner as to,
among other things, protect the public health, safety, morals, good order, and
general welfare of the citizens of the State of Louisiana.

         Notwithstanding our exclusive right to operate a land-based casino in
Orleans Parish, on a regional and local scale, we still compete with 14
riverboat or dockside gaming operations in Louisiana, including:

         o        one riverboat in Orleans Parish;

         o        two riverboats in the New Orleans metropolitan area;

         o        two riverboats in Baton Rouge;

         o        four riverboats in Lake Charles in western Louisiana; and

         o        five dockside casinos in Shreveport/Bossier City in northern
                  Louisiana.

In addition, on October 16, 2001, a fifteenth license to conduct riverboat
gaming in Louisiana was awarded by the Louisiana Gaming Control Board, to be
located in Lake Charles, Louisiana. That project is in the planning stages at
present. The riverboat gaming operations are regulated by the Louisiana
Riverboat Economic Development and Gaming Control Act (the "Riverboat Act"),
which does not impose wagering or loss limits and permits all forms of gaming
with the exception of sports betting. In March 2001, the Louisiana legislature
passed legislation that allows all riverboats to remain dockside. This change
has increased competition for our Casino.

         We also compete with land-based gaming facilities located in central
Louisiana on Native American land. The Tunica-Biloxi, Chitimacha and Coushatta
Native American tribes have each opened casinos near the towns of Marksville,
Charenton and Kinder, respectively, each of which is located more than 105 miles
from New Orleans. In addition, in February 2002, the governor of Louisiana
reached an agreement with the Jena band of Choctaw Indians that would allow this
Native American tribe to build a casino in Vinton, Louisiana (between Lake
Charles and the Texas border), pending Federal approval. The agreement did not
receive federal approval, but we anticipate the governor will continue to
negotiate with the Jena band for an acceptable contract.

         NATIONAL AND INTERNATIONAL COMPETITION. We compete for patrons on a
national scale with large casino hotel facilities located in Las Vegas, Nevada
and Atlantic City, New Jersey. Several new facilities have recently opened in
Las Vegas and other existing facilities in Las Vegas and Atlantic City have
undergone major expansions. This construction and expansion increased the number
of hotel rooms and gaming positions in the Las Vegas and Atlantic City markets
and created several attractions that have enhanced the appeal of those cities as
tourist destinations. To a lesser degree, we also compete for international
patrons with casinos in other parts of the world.

         OTHER VENUES. We may face additional regional competition generated
from land-based or riverboat casino facilities to be located in states which
have previously not allowed casino gaming activities, such as Alabama and Texas.
Bills seeking to legalize gaming are introduced in both of these states from
time to time. While the Texas legislature has thus far refused to authorize
casino gambling in Texas, Indian tribal gaming has been approved for the certain
federally recognized tribes in Texas, including the Kickapoo Nation and the
Alabama-Coushatta Indians. Under federal law, the Kickapoo Nation operates the
Lucky Eagle Pass Casino in Eagle Pass, Texas. In addition, the Alabama-Coushatta
tribe, whose reservation is near Livingston, Texas, opened a casino in November
2001. Under a different federal law, the Tigua Indians operated the Speaking
Rock Casino in El Paso. The Texas Attorney General initiated legal action to
shut down the Tigua casino and in February 2002 a federal court ordered this
casino to close. While we do not consider these activities directly competitive
with our casino due to their locations, they do provide some general regional
competition for gaming patrons and may thus affect our ability to attract
patrons in the broader region in which we operate. Further, if new legislation
permits additional gaming activities in Alabama or Texas, the Casino would
likely face increased competition for patrons from those states.



                                       9
<PAGE>

         OTHER FORMS OF LEGAL WAGERING. We compete for local customers with
other forms of legal wagering, including racetracks and off-track betting
parlors. For example, under Louisiana law, certain parishes (including Orleans
Parish) permit:

         o        restaurants, taverns, hotels and licensed clubs to operate up
                  to three video draw poker devices per location;

         o        certain truck stops to operate up to 50 video draw poker
                  devices per location; and

         o        racetracks and off-track betting parlors to operate an
                  unlimited number of video draw poker devices per location.

Louisiana law, however, limits video draw poker device wagering and jackpots.
Other forms of wagering, including charitable gaming and a state lottery,
provide additional local competition.

         In 1997, the Louisiana legislature authorized the use of slot machines
in racetracks in three parishes (but not Orleans Parish). This legislation was
subject to approval by a referendum in each of the parishes where the racetracks
were located. The voters in all three parishes approved the use of slot machines
at the racetracks located in those parishes, and legislative action on the fees
and taxes to be imposed on the slot machines received legislative approval.
These tracks are located in Calcasieu (near Lake Charles), Bossier (near
Shreveport) and St. Landry (near Lafayette) Parishes. The track in Calcasieu
Parish opened its slot machines on February 13, 2002. In the past there have
been bills introduced in the Louisiana legislature to allow the racetrack in New
Orleans to have slot machines in addition to its existing video poker machines.
We anticipate that a similar bill will be introduced in the next session of the
Louisiana legislature. Louisiana also sponsors a state-wide lottery with which
we compete to some degree for gaming business.

DEVELOPMENT PLANS

         As a result of our Plan of Reorganization, we are now free to expand
our buffet facilities from 250 to 400 seats, and develop, own and operate a
full-service restaurant with seating for 150 people. We intend to commence such
expansion and development during 2002. Funding for such expansion and
development must come from cash flow from operations or from outside financing.

         Concurrent with constructing the Casino's gaming facilities,
approximately 130,000 square feet of multipurpose non-gaming entertainment space
on the second floor of the Casino was constructed to the point at which the
shell of the structure is complete. We presented a preliminary master plan
governing the use of the second floor of the Casino to the City of New Orleans
on February 22, 2000, and are currently updating that plan. We intend to revise
the master plan to include, among other things, restaurant facilities now that
the restrictions against us providing restaurant facilities on the second floor
have been lessened. As a result of our Plan of Reorganization, we are also now
free to lease space to as many as two restaurant operators. We are obligated
under the ground lease to develop the second floor of the Casino within a
"reasonable period of time" after March 31, 2001. We are also considering
alternatives for financing of the remainder of this development. We cannot be
certain that we will ever obtain such financing. Without additional financing,
we will be unable to build-out and develop the second floor of the Casino. Jazz
Casino has subleased the second floor to JCC Development pursuant to the terms
of a sublease dated October 29, 1998, and JCC Development intends to manage and
lease the second floor development in a manner consistent with the master plan.
The term of the second floor sublease commenced in September 1999. Unless the
second floor sublease is sooner terminated by its terms, the sublease will
terminate on the earlier of the date of expiration or the date of termination of
Jazz Casino's amended and restated ground lease dated October 29, 1998 with the
Rivergate Development Corporation, as landlord, and the City of New Orleans, as
intervenor, for the Casino site in New Orleans. The Louisiana Gaming Control
Board has the authority to approve the master plan and all subleases and uses on
the second floor. Jazz Casino is entitled to convert any portion of the second
floor to gaming use, subject to the approval of the Louisiana Gaming Control
Board and the provisions of its casino operating contract. If, however, this
conversion reduces the sublease revenue payable to the Rivergate Development
Corporation pursuant to the second floor sublease, Jazz Casino is required,
under certain circumstances and for certain periods of time, to compensate the
Rivergate Development Corporation for the reduction.



                                       10
<PAGE>

         We own a city block of historical buildings across the street from the
Casino and its garages, which we have planned to develop into entertainment and
other uses that support the Casino. At this time, we have not completed our
plans and have not obtained financing for this development. We cannot be certain
that we can obtain such financing. This property does not generate any material
revenue for us.

         We also owned the parcel of land across from the Casino located at 3
Canal Place in New Orleans, adjacent to the Canal Place Shopping Center. On
October 15, 2001, we closed on the sale of this property to CP3 Associates, LLC.
We plan to use the funds from the sale for development needs, including second
floor development, subject to any limitations imposed by our financing
documents. These funds, however, are not sufficient to complete development of
the second floor.

EMPLOYEES

         As of March 1, 2002, we had approximately 2,200 full-time employees and
300 part-time employees. Jazz Casino, through the Manager, hires and trains
employees to operate the Casino. The Casino's executive staff is comprised of
employees of the Manager. The Gaming Act requires that at least 80% of the
Casino's employees be Louisiana residents for at least one year prior to
employment. Jazz Casino's ground lease with the Rivergate Development
Corporation and the City of New Orleans also requires that at least 55% of the
employees of Jazz Casino and JCC Development live and reside in Orleans Parish,
subject to reduction to comply with applicable law. This minimum percentage will
increase by 2% on each anniversary of the Casino's opening on October 28, 1999,
until the residency requirement reaches 65%, subject to reductions to comply
with applicable law. Jazz Casino's amended general development agreement and
ground lease also require it to comply with the revised and updated open access
program and plans adopted pursuant thereto that are designed to facilitate
participation by minorities, women, and disadvantaged persons and business
enterprises in developing, constructing and operating the Casino.

                                   REGULATION

LOUISIANA GAMING ACT

         The ownership and operation of the Casino are subject to pervasive
governmental regulation, including regulation by the Louisiana Gaming Control
Board in accordance with the terms of the Gaming Act, the rules and regulations
promulgated thereunder and our casino operating contract. The operating contract
has a twenty-year term beginning in July 1994, with one ten-year option to
extend.

         The Gaming Act and the rules and regulations promulgated thereunder,
all of which are subject to amendment or revision, establish significant
regulatory requirements with respect to gaming and non-gaming activities,
including, without limitation:

         o        requirements with respect to permitted games;

         o        minimum accounting and financial practices;

         o        standards for gaming devices and surveillance;

         o        suitability requirements for our equity and debt holders,
                  officers, directors, and employees, and licensing requirements
                  for our vendors;

         o        standards for credit extension and collection; and

         o        permissible food services.

Failure to comply with the Gaming Act or its rules and regulations could result
in disciplinary action, including fines and suspension or revocation of a
license or an adverse suitability determination. Certain regulatory violations
could



                                       11
<PAGE>

also constitute an event of default under our casino operating contract,
resulting in the termination of our right to operate the Casino.

         Under the Gaming Act and the rules and regulations promulgated
thereunder, Jazz Casino, JCC Holding, and their members, officers and directors
were required to be found suitable by the Louisiana Gaming Control Board in
order to own and operate the Casino. This suitability requirement must be
continuously satisfied during the term of the casino operating contract. The
Gaming Act and its rules and regulations also require suitability findings for,
among others, the Casino's Manager, anyone with a direct ownership interest
(regardless of percentage interest) or the ability to control Jazz Casino, JCC
Holding or the Casino's Manager (as well as their intermediary and holding
companies), certain officers and directors of such companies, certain employees
of Jazz Casino and the Casino's Manager and certain specified debt holders and
lenders that have loaned Jazz Casino or JCC Holding money in connection with the
Casino's construction and operation. To be found suitable, an applicant must
show:

         o        the applicant is a person of good character, honesty and
                  integrity;

         o        the applicant's prior activities, criminal record, if any,
                  reputation, habits and associations do not pose a threat to
                  the public interest of Louisiana or the regulation and control
                  of casino gaming or create or enhance the dangers of
                  unsuitable, unfair or illegal practices, methods and
                  activities in the conduct of gaming or the carrying on of the
                  business and financial arrangements incidental thereto; and

         o        the applicant is capable of and is likely to conduct the
                  activities for which a license or contract is sought.

In addition, to be found suitable for purposes of the casino operating contract,
Jazz Casino must demonstrate that:

         o        it has or can guarantee its ability to acquire adequate
                  business competence and experience in conducting casino gaming
                  operations;

         o        financing that it seeks to obtain is adequate for the proposed
                  operation and is from suitable sources; and

         o        it has, or is capable of, and guarantees its ability to obtain
                  a bond or satisfactory financial guarantee of a sufficient
                  amount to guarantee successful completion of and compliance
                  with the casino operating contract or such other projects that
                  are regulated by the Louisiana Gaming Control Board.

         Under the Gaming Act and its rules and regulations, any person holding
or controlling a direct or beneficial 5% or more equity interest (either alone
or in combination with others) in a direct or indirect holding company of Jazz
Casino, including JCC Holding or the Casino's Manager, is presumed to have the
ability to control Jazz Casino or the Casino's Manager (or their holding
companies, as the case may be), requiring a finding of suitability. However,
this suitability finding is not required if, among other things, the presumption
of control is rebutted or the holder is one of several specified passive
institutional investors and it submits documentation which establishes (i) it
holds its interest in the ordinary course of business for investment purposes
only; (ii) it does not exercise influence over the affairs of JCC Holding or
Jazz Casino (this shall not include the exercise of voting privileges), and
(iii) it does not intend to exercise influence over JCC Holding or Jazz Casino
and it will notify the Louisiana Gaming Control Board in writing if such intent
should change. To the extent any holder of the securities of JCC Holding fails
to satisfy such requirement, the holder may be required to obtain certain
qualifications or approvals (including a finding of suitability) from the
Louisiana Gaming Control Board to continue to hold such securities. Any failure
to obtain these qualifications or approvals may, by virtue of the requirements
imposed on us, subject these security holders to certain requirements,
limitations or prohibitions, including a requirement that the security holders
liquidate their securities at a time or at a cost that is otherwise unfavorable.
In addition, the Louisiana Gaming Control Board has the authority to investigate
the suitability or qualifications of any of our investors, including an
institutional investor, should it become aware of facts or information that an
investor may be found unsuitable or disqualified.



                                       12
<PAGE>

         Further, under the Gaming Act, the sale, transfer, assignment, pledge,
alienation, disposition, public offering, or acquisition of securities that
results in one person's owning 5% or more of the total outstanding shares issued
by Jazz Casino is void as to such person without prior approval of the Louisiana
Gaming Control Board. Failure to obtain prior approval by the Louisiana Gaming
Control Board of a person acquiring 5% or more of the total outstanding shares
of a licensee or 5% or more economic interest in Jazz Casino is grounds for
cancellation of the casino operating contract or license suspension or
revocation.

         Under the Gaming Act and its rules and regulations, the Louisiana
Gaming Control Board has the authority to deny, revoke, suspend, limit,
condition, or restrict any finding of suitability. The Louisiana Gaming Control
Board also has the authority to take further action against Jazz Casino on the
grounds that a person found suitable is associated with, or controls, is
controlled by, is under common control with, an unsuitable or disqualified
person. If at any time the Louisiana Gaming Control Board finds that any person
required to be and remain suitable has failed to demonstrate suitability, the
Louisiana Gaming Control Board may take any action it deems necessary to protect
the public interest. However, if a person associated with Jazz Casino, the
Casino's Manager or their affiliates, intermediaries, or holding companies, as
the case may be, has failed to be found or remain suitable, the Louisiana Gaming
Control Board will not declare these companies unsuitable if the companies
comply with the conditional licensing provisions, take immediate good faith
action and comply with any order of the Louisiana Gaming Control Board to cause
the person to dispose of its interest, and, before such disposition, ensure that
the disqualified person does not receive any ownership benefits. These
protections do not apply if Jazz Casino, the Casino's Manager or their
affiliates, intermediaries, or holding companies, as the case may be, (1) fail
to remain suitable, (2) had actual or constructive knowledge of the facts that
are the basis for the Louisiana Gaming Control Board regulatory action and
failed to take appropriate action, or (3) are so tainted by such person that it
affects the suitability of the entity under the standards of the Gaming Act.

         Under the Gaming Act, the Louisiana Gaming Control Board and the
Louisiana state police are required to issue licenses or permits to certain
persons associated with our gaming operations, including:

         o        certain employees of Jazz Casino and the Casino's Manager;

         o        certain manufacturers, distributors and suppliers of gaming
                  devices;

         o        certain suppliers of non-gaming goods or services;

         o        any person who furnishes services or property to Jazz Casino
                  under an arrangement pursuant to which the person receives
                  payments based on earnings, profits or receipts from gaming
                  operations; and

         o        any other persons deemed necessary by the Louisiana Gaming
                  Control Board.

         Securing the requisite licenses and permits under the Gaming Act is a
prerequisite for conducting, operating or performing any activity regulated by
the Louisiana Gaming Control Board or the Gaming Act. The Louisiana Gaming
Control Board has full and absolute power to deny an application, or to limit,
condition, restrict, revoke or suspend any license, permit or approval, or to
fine any person licensed, permitted or approved for any cause specified in the
Gaming Act or rules promulgated by the Louisiana Gaming Control Board. The
Gaming Act's rules and regulations provide that the Louisiana Gaming Control
Board may take any such actions with respect to any person licensed, permitted,
or approved, or any person registered, found suitable, or holding a contract,
for any cause deemed reasonable. Moreover, any license, permit, contract,
approval or thing obtained or issued pursuant to the provisions of the Gaming
Act has been expressly declared by the legislature to be a pure and absolute
revocable privilege and not a right, property or otherwise, under the
constitutions of the United States or of the State of Louisiana. The Gaming Act
also provides that no holder acquires any vested right therein or thereunder.

         Under the Gaming Act's rules and regulations, all of which are subject
to amendment or revision from time to time, gaming activities that may be
conducted at an official gaming establishment, subject to the rule-making
authority of the Louisiana Gaming Control Board, include any banking or
percentage game that is played with cards, dice or any electronic, electrical or
mechanical device or machine for money, property or any thing of value, but



                                       13
<PAGE>

exclude lottery, bingo, charitable games, raffles, electronic video bingo, pull
tabs, cable television bingo, wagering on dog or horse races, sports betting or
wagering on any type of sports contest or event. The Gaming Act's rules and
regulations provide the Louisiana Gaming Control Board broad discretionary
authority to regulate all aspects of a casino operator's operations, including
the power to, among other things:

         o        establish significant regulatory requirements with respect to
                  gaming activities, including, but not limited to:

                           o        suitability standards for direct and
                                    indirect investors,

                           o        requirements with respect to minimum
                                    accounting and financial practices,

                           o        standards for gaming devices and
                                    surveillance,

                           o        licensure requirements for vendors and
                                    employees, and

                           o        permissible food services;

         o        investigate violations of the Gaming Act and any rules and
                  regulations promulgated thereunder, and any other incidents or
                  transactions that it deems appropriate;

         o        conduct hearings and proceedings concerning, and reviews and
                  inspections of, gaming operations and related activities;

         o        inspect and examine all premises, and all equipment or
                  supplies thereon, where gaming activities are conducted, and
                  impound, examine and inspect any equipment or supplies;

         o        audit the records of applicants and gaming operators relating
                  to revenues produced by their gaming operations;

         o        issue interrogatories and subpoenas; and

         o        monitor the conduct of a casino operator such as Jazz Casino,
                  and licensees, permittees and other persons having a material
                  involvement directly or indirectly with the casino operator.

         Our Plan of Reorganization and actions by the Louisiana legislature
relating to our Plan of Reorganization, resulted in, among other things, certain
changes to the Gaming Act and the casino operating contract, including lowering
the minimum payment due the Louisiana Gaming Control Board from $100 million to
the greater of (i) $50 million for the casino operating contract fiscal year
April 1, 2001 to March 31, 2002 and $60 million for each casino operating
contract fiscal year of the term of the casino operating contract thereafter, or
(ii) the sum of a sliding scale of gross gaming revenues that begins at 21.5%
for gross gaming revenues up to $500 million and escalates to a high of 29% for
revenues in excess of $900 million. We are required to pay the minimum payment
in daily increments with an end of the year settlement for any percentage of
gross gaming revenues in excess of such amount.

         Pursuant to the amendments to the casino operating contract and
pursuant to an unconditional guaranty executed by Harrah's Entertainment and
Harrah's Operating Company, effective on the consummation of our Plan of
Reorganization, Harrah's Entertainment and Harrah's Operating Company have
agreed to guarantee to the Louisiana Gaming Control Board the minimum payments
for the four year period commencing April 1, 2001 and ending March 31, 2005. In
addition, on or before March 31, 2003, we are required to cause a third party to
post a guaranty of the minimum payments for our fiscal year beginning April 1,
2005 in a form acceptable to the Louisiana Gaming Control Board and issued by a
lender or third party with resources suitable to cover the minimum payments (as
determined by the Louisiana Gaming Control Board) and that otherwise meets any
suitability requirements imposed by the Louisiana Gaming Control Board. Unless
gross gaming revenues exceed $350 million for two successive years with no
defaults by us and certain other financial tests are met, this third party
guaranty requirement continues for each fiscal year thereafter during the term
of the casino operating contract. As a result, under the amendments to the
casino operating contract, at the beginning of each fiscal year, there must be
in place at least 36 months of third party guaranteed minimum payments to the
Louisiana Gaming Control Board. Under the terms of the amendments to the casino
operating contract, the failure to post such a guaranty by the date required by


                                       14
<PAGE>

the casino operating contract results in the automatic termination of the casino
contract upon the last day that the minimum payments are then guaranteed, with
no cure period.

         On March 22, 2001, legislation became effective that amended the Gaming
Act and significantly reduced the food, hotel, and retail restrictions that had
been imposed on us. The previous restaurant restrictions were modified and we
now are authorized to: (i) directly own and operate a single full service
restaurant with seating limited to 150 seats; (ii) expand our limited cafeteria
style seating from 250 to 400 seats; (iii) cater certain functions within the
Casino facility; and (iv) lease space to area restaurant owners in a food court
with seating limited to 100 seats. On the second floor of the Casino we are
allowed, subject to City approval and subject to approval of the Louisiana
Gaming Control Board, to: (x) lease space to no more than two unaffiliated third
party restaurant(s), which, when calculated together, shall contain no more than
350 seats; (y) operate any business or entertainment facility on the second
floor, provided that any food for such operation must be purchased or catered by
a third party restaurateur or food preparer with purchases at fair market value;
and (z) lease space to any other third parties to operate businesses where the
primary purpose of any such business is not a restaurant and that requires no
more than 35% of the gross revenue of such business shall be derived from the
sale of food. The legislation also authorizes us to offer and advertise
complimentary and discounted food offerings to certain specified persons,
including a member of a customer reward system and other patrons based upon
observed play at the Casino. We, however, may not offer or advertise discounted
or complimentary food offerings through any advertising media to the general
public within a 50 mile radius of the Casino within Louisiana.

         The lodging restrictions previously in effect under the Gaming Act were
also modified, and we are now authorized to own, construct or lease lodging with
no more than 450 rentable units off of the Casino site. The lodging, however,
may be physically connected to the Casino. Meeting space must be limited to
15,000 square feet if the hotel is newly constructed, or 20,000 square feet if
an existing hotel is purchased or leased and contains such space. The amendments
to the Gaming Act provide that after March 31, 2005, we may own or operate
additional hotel rooms if the Greater New Orleans Hotel Association agrees to
the increase. Except for the limited exception for Casino customers, under the
amendments to the Gaming Act, we may not advertise hotel rooms to the general
public at rates below market rates. We are required to base room rates on a
formula derived from average seasonal rates for the preceding year in the
locality of the Casino (as compiled by a nationally recognized firm). The
legislation also authorizes us to provide limited complimentary and discounted
hotel offerings to certain specified persons, including a member of a customer
reward system and other patrons based upon observed play at the Casino,
provided, however, we shall pay room taxes on all such hotel rooms based upon
prevailing tax schedules and rates as determined by the formula described above.

         All restrictions on the sale of non-gaming products within the Casino
were eliminated from the Gaming Act, effective March 22, 2001 and from the
City's Comprehensive Zoning Ordinance, effective March 21, 2001.

         The Gaming Act, its rules and regulations, and the casino operating
contract have extensive provisions and prior approval requirements relating to
certain borrowings incurred, and security interests granted, by Jazz Casino and
JCC Holding in connection with the Casino. The Gaming Act authorizes the
Louisiana Gaming Control Board to provide for the protection of the rights of
holders of security interests in both immovable property and movable property
used in or related to Casino gaming operations and to provide for the continued
operation of the official gaming establishment during the period of time that a
lender, as a holder of a security interest, seeks to enforce its security
interest in such property. In connection therewith, the Gaming Act provides that
the holder of a security interest in gaming related collateral may receive
payments from the owner or lessee of such property out of the proceeds of Casino
gaming operations received by the owner or lessee, and, the holder of the
security interest may be exempt from the licensing requirements of the Gaming
Act with respect to these payments if the transaction(s) giving rise to the
payments were approved in advance by the Louisiana Gaming Control Board, comply
with all rules and regulations of the Louisiana Gaming Control Board and the
Louisiana Gaming Control Board determines that the holder is suitable.

STATE LEGISLATION

         Because legalized gaming is a relatively new industry in Louisiana,
there has been significant attention by the Louisiana legislature over the past
few years to gaming related bills dealing with a wide range of subjects that
could impact the Casino. For example, at various times, bills have been
introduced to, among other things:



                                       15
<PAGE>

         o        constitutionally and/or legislatively repeal all forms of
                  gaming (including gaming at the Casino);

         o        increase taxes on riverboat casinos (such a bill passed in
                  March 2001);

         o        permit dockside riverboat gaming (such a bill passed in March
                  2001);

         o        limit credit that may be extended by casinos;

         o        mandate payout schedules for slot machines; and

         o        limit days and hours of operations.


ITEM 2. PROPERTIES.

         We own a city block of historical buildings across the street from the
Casino and its garages. This property currently does not generate any material
revenues. We owned the parcel of land across from the Casino at 3 Canal Place,
adjacent to the Canal Place Shopping Center. We sold this property to CP3
Associates, LLC on October 15, 2001. In addition, we are party to an
approximately 23-year, long-term ground lease, as amended as a result of our
Plan of Reorganization, for the Casino site at the foot of Canal and Poydras
Streets in New Orleans. Under the ground lease, we also lease the land across
from the Casino on Poydras Street upon which the Casino operates two parking
facilities that are connected to the Casino by an underground tunnel and that
together contain approximately 1,550 spaces.

         We lease our principal executive offices of approximately 30,000 square
feet under a 104 month lease effective as of January 1, 2000. Our property
located on Fulton and Poydras Streets, which contains approximately 48,300
square feet of usable office space, is being used for recruiting offices until
the property is developed.

         Approximately 130,000 square feet of multipurpose non-gaming
entertainment space on the second floor of the Casino has been constructed to
the point at which the shell of the structure is complete and the space is
suitable for tenant build-out. Jazz Casino has subleased the second floor to JCC
Development and JCC Development intends to manage and lease the second floor in
a manner consistent with a master plan being developed by JCC Development and
Jazz Casino. The term of the second floor sublease commenced in September 1999
and terminates on the earlier of the date of expiration or the date of
termination of Jazz Casino's ground lease (as modified as a result of our Plan
of Reorganization) with the Rivergate Development Corporation and the City of
New Orleans, unless the second floor sublease is sooner terminated by its terms.

         Under a lease that expires in July 2023, we lease approximately 15
acres of land, including an unoccupied 15,000 square foot building. It was
originally anticipated that this land would be used for employee parking.
However, more suitable parking was located closer to the Casino. On January 3,
2001 this lease was amended to provide that a significant portion of the
property, including the unoccupied building, was released to the landlord,
effective March 31, 2001 and the rent reduced. On February 7, 2001, we entered
into a month-to-month sublease agreement with a third party which subleased the
remaining property under this lease effective as of February 1, 2001. We have
the right to terminate this lease on August 1, 2003. Pursuant to a master lease
that expires in February 2004, we also lease an aggregate of approximately
41,000 square feet of warehouse space where we store gaming equipment and
supplies for use in the Casino.

         To secure present and future indebtedness under certain of our
agreements the following are subject to mortgages granted to the Bank of New
York as the collateral agent: (1) Jazz Casino's interest in the amended and
restated ground lease between Jazz Casino and the Rivergate Development
Corporation and the City of New Orleans, (2) the property located on Fulton and
Poydras Streets, (3) the sublease of the second floor of the Casino, and (4) the
lease of approximately 15 acres of land described above. The mortgage on the
property located at 3 Canal Place was released as a result of the sale of this
property to CP3 Associates, LLC.



                                       16
<PAGE>

ITEM 3. LEGAL PROCEEDINGS.

         We are subject to legal proceedings and claims that arise in the normal
course of business. While we cannot predict the outcome of these matters with
certainty, we do not believe they will materially and adversely affect our
business, financial condition or results of operations.

         In addition, following our reduction in the Casino's work force on July
17, 2001, former employees of the Casino filed lawsuits against us in the Civil
District Court for the Parish of Orleans, State of Louisiana on August 3, 2001.
Since filing, the matter was removed to the United States District Court for the
Eastern District of Louisiana. Plaintiffs have filed a Motion to Remand the
lawsuit to state court, which is currently pending. The Plaintiffs are seeking
damages for being laid off prior to the expiration of the term of alleged
employment contracts between our employees and us. We believe that we have
strong legal and factual defenses, and intend to vigorously contest the claims.
No assurances can be given as to the outcome of such lawsuits, and consequently,
we cannot reasonably predict at this time whether the final outcome of these
matters will materially and adversely affect our results of operations, cash
flows, or financial condition.

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

         We did not submit any matters to a vote of stockholders during our
fourth fiscal quarter ended December 31, 2001.

EXECUTIVE OFFICERS OF THE REGISTRANT

         Set forth below is certain information regarding the executive officers
of JCC Holding.

         Paul D. Debban, age 50, has served as the President of JCC Holding and
Jazz Casino since July 15, 2001. Mr. Debban has also served as a director on our
board of directors since June 15, 2001. Since 1988, Mr. Debban has served as
Managing Director of the Reorganized Securities Group, a division of the
investment banking firm The Seidler Companies, Inc.

         Preston Smart, age 46, has served as the President of JCC Development,
Canal Development and Fulton Development since July 15, 2001. Mr. Smart has
served as Vice President of JCC Holding since November 2, 2001. Mr. Smart has
also served as a director on our board of directors since August 23, 2001. Since
August 1995, Mr. Smart has served as the Chairman and Chief Executive Officer of
BayVen Capital, Inc., a privately held investment firm.

         L. Camille Fowler, age 47, has served as the Vice President -- Finance,
Treasurer and Secretary of JCC Holding, Jazz Casino, JCC Development, Canal
Development and Fulton Development since September 1998. Ms. Fowler continued to
serve in her capacity as an executive officer for these entities prior to and
during our 2001 bankruptcy proceedings, as well as after the effective date of
the Plan of Reorganization. Ms. Fowler also served as Director of Finance of the
Manager from April 1996 to November 1998, Vice President and Secretary of the
Manager from January 1998 to November 1998, and Treasurer of the Manager from
February 1998 to November 1998. From October 1993 until April 1996, Ms. Fowler
served as the Director of Financial Reporting of the Manager.

                                     PART II

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

COMMON STOCK PRICE

         In accordance with our Plan of Reorganization, we issued, effective on
March 29, 2001, an aggregate of 12,386,200 shares of Common Stock, which began
trading on the Over-the-Counter Bulletin Board under the



                                       17
<PAGE>

symbol "JCHC" on April 27, 2001 and through the Over-the-Counter Bulletin Board
trading system.

<Table>
<Caption>

                                                                 HIGH             LOW
                                                                ------           ------
<S>                                                             <C>              <C>
Fiscal 2001
  Second Quarter.........................................       $ 6.00           $ 2.00
  Third Quarter..........................................       $ 5.16           $ 1.41
  Fourth Quarter.........................................       $ 2.00           $ 0.55
</Table>

         Our class A common stock began trading on the American Stock Exchange
under the symbol "JAZ" on December 9, 1998. Prior to that time, our class A
common stock was not listed or traded on any organized market. On November 15,
2000, the American Stock Exchange halted trading in our stock and notified us
that we no longer met the American Stock Exchange's continued listing
requirements. The class A common stock was delisted by the American Stock
Exchange on November 30, 2000, and subsequently was traded only on the
Over-the-Counter Bulletin Board under the Symbol "JCCHA." On March 19, 2001 the
United States Bankruptcy Court for the Eastern District of Louisiana confirmed
our Plan of Reorganization which, among other things, resulted in the
elimination of all of our outstanding shares of class A common stock and class B
common stock upon the effective date of the Plan of Reorganization, which was
March 29, 2001. The table set forth below provides, on a per share basis for
each quarter in 2001 and 2000, the high and low sales prices of our class A
common stock as reported on the American Stock Exchange and through the
Over-the-Counter Bulletin Board trading system.

<Table>
<Caption>
                                                         HIGH             LOW
                                                        ------           ------
<S>                                                     <C>              <C>
Fiscal 2001
  First Quarter.......................................  $ 0.44           $ 0.05
Fiscal 2000
  First Quarter.......................................  $ 4.25           $ 1.19
  Second Quarter......................................  $ 2.00           $ 0.63
  Third Quarter.......................................  $ 1.56           $ 0.50
  Fourth Quarter......................................  $ 0.81           $ 0.02
</Table>

HOLDERS

         As of March 1, 2002, there were approximately 35 holders of record of
the Common Stock, and we estimate that there were approximately 1,100 beneficial
owners of the Common Stock.

DIVIDEND POLICY

         We have never paid any cash dividends on our class A or class B common
stock and none will ever be paid inasmuch as all of these shares of common stock
were eliminated on March 29, 2001 as a result of our Plan of Reorganization.

         We do not intend to pay cash dividends on the Common Stock in the
foreseeable future. Further, pursuant to the terms of the indenture for our
Senior Notes, revolving credit agreement, and HET/JCC Agreement, we are
restricted from paying dividends on the Common Stock to our stockholders, or
from setting aside funds for this purpose. The payment of cash dividends, if
any, will be made only from assets legally available for that purpose (i.e. net
profits or capital surplus), and will depend on our financial condition, results
of operations, current and anticipated capital requirements, restrictions under
then existing debt instruments and other factors deemed relevant by the board of
directors.



                                       18
<PAGE>

RECENT SALES OF UNREGISTERED SECURITIES

         Pursuant to our Plan of Reorganization, we issued, effective on March
29, 2001, the following new equity and debt securities to certain creditors:

         o        JCC Holding issued an aggregate of 12,386,200 shares of Common
                  Stock, guarantees with respect to the Senior Notes, and
                  guarantees of JCC Development's, Canal Development's and
                  Fulton Development's guarantees with respect to the Senior
                  Notes;

         o        Jazz Casino issued $124,519,758 of Senior Notes; and

         o        each of JCC Development, Canal Development and Fulton
                  Development issued guarantees with respect to the Senior
                  Notes.

The securities and guarantees listed above were issued without registration
under the Securities Act, or state or local law, in reliance on the exemptions
provided for in Section 1145 of Title 11 of the Bankruptcy Code and Section 4(2)
of the Securities Act.

ITEM 6. SELECTED FINANCIAL DATA.

         The following table sets forth selected consolidated statements of
operations and balance sheet data of (1) JCC Holding for the fiscal years ended
and as of December 31, 2001, 2000 and 1999, and the two-month period ended
December 31, 1998, and (2) Harrah's Jazz Company for the ten-month period ended
October 30, 1998 and for the fiscal year ended, and as of, December 31, 1997.
Although JCC Holding was incorporated on August 20, 1996, prior to October 30,
1998, we had not conducted any operations, generated any revenues or issued any
capital stock. Accordingly, separate financial information with respect to the
Company prior to the two-month period ended December 31, 1998 is omitted because
we do not believe that such separate financial information is material or
meaningful. On October 30, 1998, Jazz Casino succeeded to all of the assets of
Harrah's Jazz Company except the property located at 3 Canal Place and the
property located on Fulton and Poydras Streets, which vested in Canal
Development and Fulton Development, respectively. The selected financial data
for the ten-month period ended October 30, 1998 and for the fiscal year ended
and as of December 31, 1997 have been derived from Harrah's Jazz Company's
audited financial statements. The selected financial data for the fiscal years
ended and as of December 31, 2001, 2000 and 1999 and for the two-month period
ended and as of December 31, 1998 have been derived from our audited financial
statements. The selected financial data should be read in conjunction with "Item
7. Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Item 8. Financial Statements and Supplementary Data," and in
light of our Plan of Reorganization.




                                       19
<PAGE>
<Table>
<Caption>

                                                                                                          HARRAH'S JAZZ
                                                         JCC HOLDING (SUCCESSOR)                       COMPANY (PREDECESSOR)
                                        --------------------------------------------------------    ----------------------------
                                                                                   TWO MONTH         TEN MONTH
                                                                                  PERIOD ENDED      PERIOD ENDED    YEAR ENDED
                                                 YEAR ENDED DECEMBER 31,           DECEMBER 31,      OCTOBER 30,    DECEMBER 31,
                                        ----------------------------------------  --------------    ----------------------------
                                          2001            2000            1999         1998            1998             1997
                                        ---------      ---------       ---------  --------------    ------------    ------------
                                          (In thousands, except per share data)

<S>                                  <C>            <C>                <C>          <C>          <C>               <C>
Net revenues                            $ 238,647      $ 242,114    (a)$  40,257    $      14       $      87       $   1,679
Extraordinary items                  (c)$ 213,448      $      --       $      --    $      --    (d)$ 267,706       $      --
Net income (loss)                    (c)$  91,786   (b)$(354,228)      $ (59,140)   $  (3,677)   (d)$ 169,993       $ (21,244)
Basic net income (loss) per share    (c)$    7.41      $  (34.79)      $   (5.88)   $   (0.37)            N/A             N/A
Total assets                            $ 223,123      $ 221,461       $ 506,402    $ 343,131       $      --       $ 354,417
Long-term debt                          $ 105,676      $ 396,412       $ 368,222    $ 185,519       $      --       $      --
Liabilities subject to compromise       $      --      $      --       $      --    $      --       $      --       $ 523,468
</Table>


         (a)      JCC Holding's fiscal 1999 results of operations reflect
                  approximately two months of revenues generated from the
                  Casino, which opened on October 28, 1999.

         (b)      JCC Holding's 2000 net loss includes an asset impairment
                  charge of $258.8 million which is discussed in Note 3 to JCC
                  Holding Company's consolidated financial statements included
                  in "Item 8. Financial Statements and Supplementary Data."

         (c)      On March 29, 2001, upon emerging from bankruptcy, JCC Holding
                  recorded an extraordinary gain on early extinguishment of debt
                  of $213.4 million ($17.23 per share), which is discussed in
                  Note 1 to JCC Holding Company's consolidated financial
                  statements included in "Item 8. Financial Statements and
                  Supplementary Data."

         (d)      On October 30, 1998, in accordance with the Harrah's Jazz
                  Company ("HJC") Joint Plan of Reorganization, HJC's 14 1/4%
                  First Mortgage Notes due 2001 with Contingent Interest were
                  cancelled and certain other indebtedness was forgiven and/or
                  cancelled in consideration of receiving new equity and debt
                  securities. Accordingly, HJC recognized an extraordinary gain
                  totaling $267.7 million in its statement of operations for the
                  ten months ended October 30, 1998.


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

The following discussion and analysis should be read in conjunction with "Item
6. Selected Financial Data" and "Item 8. Financial Statements and Supplementary
Data." This discussion contains forward-looking statements that involve
uncertainties and risks, such as statements of our plans, objectives,
expectations and prospects. Our actual results could differ materially from
those discussed herein as a result of certain factors, including but not limited
to those discussed below in "Factors Affecting Future Performance" and elsewhere
in this document. All of these statements and the entire text that follows
should be read in conjunction with and in light of our Plan of Reorganization
that became effective on March 29, 2001.

OVERVIEW

         We are a casino and entertainment company. JCC Holding Company was
incorporated under Delaware law on August 20, 1996, and conducts business
through its wholly-owned subsidiaries, Jazz Casino Company, JCC Development
Company, JCC Canal Development and JCC Fulton Development. We began operations
in October 1998, when we assumed the business operations formerly owned by
Harrah's Jazz Company, a general partnership, and its subsidiary, Harrah's Jazz
Finance Corporation, which filed for relief under the United States Bankruptcy
Code on November 22, 1995. On October 30, 1998, in accordance with the plan of
reorganization of Harrah's Jazz Company and its subsidiary, Harrah's Jazz
Finance Corporation, we became the successor to the operations of Harrah's Jazz
Company. Although JCC Holding Company was incorporated on August 20, 1996, prior
to October 30, 1998, we did not conduct any operations, generate any revenues or
issue any capital stock. During the period from October 30, 1998 to October 27,
1999, our activities consisted primarily of administering the construction of
our Casino and preparing for opening of the Casino on October 28, 1999. Because
the Casino did not open until October 28, 1999, our results of operations for
2000 and 1999 are not comparable. As a result, the discussion regarding
operating results during 2000 and 1999 addresses only the various significant
components of revenue and expense line items contributing to net losses for the
respective periods.


                                       20
<PAGE>

         On January 4, 2001, we filed voluntary petitions for relief under
Chapter 11 of the U.S. Bankruptcy Code in order to allow restructuring of our
obligations to the State of Louisiana and the City of New Orleans, long-term
debt, bank credit facilities and trade and other obligations. The Bankruptcy
Court confirmed our Plan of Reorganization on March 19, 2001 and this plan was
effective on March 29, 2001. While the Company was in bankruptcy, we continued
to operate the business as debtors-in-possession subject to the Bankruptcy
Court's supervision and orders.

         We did not meet the requirements to utilize fresh start reporting,
since our holders of existing voting shares immediately before confirmation
received more than 50 percent of voting shares of the emerging entity.
Therefore, in accordance with Statement of Position 90-7: "Financial Reporting
by Entities in Reorganization Under the Bankruptcy Code," our liabilities
compromised by the confirmed Plan of Reorganization have been stated at the
present value of the amounts to be paid, reorganization expenses have been
separately disclosed and the forgiveness of affiliate and non-affiliate debt has
been reported as an adjustment to additional paid in capital and an
extraordinary item, respectively, in the Consolidated Financial Statements.

         All of the following text should be read in light of and in conjunction
with the Plan of Reorganization, a copy of which was filed on March 29, 2001,
with the SEC as part of a Form 8-K filing concerning the approval of the
bankruptcy proceeding (which filing is incorporated herein by reference).

RESULTS OF OPERATIONS

         RESULTS OF OPERATIONS

         TOTAL NET REVENUES. The following table reflects the percentage changes
in revenues by category:

<Table>
<Caption>

                                                                                            PERCENTAGE
                                                                                       INCREASE/(DECREASE)
                                                                                     -----------------------
(IN THOUSANDS)                                  2001         2000         1999       01 VS 00     00 VS 99 *
                                              ---------    ---------    ---------    ---------    ----------
<S>                                           <C>          <C>          <C>          <C>          <C>
Revenues:
  Casino                                      $ 242,950    $ 245,473    $  38,005         (1.0%)       545.9%
  Food and beverage                              21,673       20,356        3,693          6.5%        451.2%
  Retail, parking and other                      10,816        9,821        1,819         10.1%        439.9%
  Less - casino promotional allowances          (36,792)     (33,536)      (3,260)         9.7%        928.7%
                                              ---------    ---------    ---------
       Total Net Revenues                     $ 238,647    $ 242,114    $  40,257         (1.4%)       501.4%
                                              ---------    ---------    ---------
</Table>

* Our revenues for 2000 and 1999 are not comparable.

         Casino revenues in 2001 decreased slightly as compared to the previous
year primarily due to decreased tourist and conventioneer traffic in New
Orleans, coupled with the adverse effects on tourism of the terrorist attacks in
the United States on September 11, 2001. Food and beverage revenue increased
during 2001 primarily due to an increase in buffet pricing as well as an
increase in the number of covers served. Retail, parking, and other revenue also
increased during 2001 primarily due to increased parking revenues as a result of
a change in complimentary parking policies. This change also contributed, in
part, to the increases in casino promotional allowances. Increased internal
customer complimentaries related to beverages and meals also contributed to the
increase.

         Because the Casino did not open until October 28, 1999, our revenues
for 2000 and 1999 are not comparable. In 2000, the Casino's first full year of
operations, we generated Casino revenue of $245.5 million, food and beverage
revenue of $20.4 million, and retail, parking and other revenue of $9.8 million.
Casino promotional allowances amount to $33.5 million resulting in total net
revenues of $242.1 million. This level of revenues continued to be below the
level necessary to satisfy our liquidity needs. Despite the deferrals under
certain of our contractual agreements, our obligations, including the $100
million minimum annual payment required under our casino operating contract,
continued to exceed revenues on a monthly basis. From January 1, 1999 to October
27, 1999, we generated revenues of approximately $126,000 consisting of parking
revenues generated primarily by the parking facilities located on our property
at 3 Canal Place, which opened in June 1999, and at the Casino, which opened in
October 1999. From October



                                       21
<PAGE>


28, 1999 to December 31, 1999, Casino revenues, food and beverage revenues, and
retail, parking and other revenues net of promotional allowances were $40.1
million.

OPERATING EXPENSES. The following table reflects the percentage changes in
operating expenses by category:


<Table>
<Caption>

                                                                                            PERCENTAGE
                                                                                        INCREASE/(DECREASE)
                                                                                   ------------------------------
(IN THOUSANDS)                         2001           2000             1999          01 VS 00         00 VS 99 *
                                   ------------    ------------    ------------    ------------      ------------
<S>                                <C>             <C>             <C>             <C>               <C>
Operating Expenses:
  Direct:
      Casino                       $    147,077    $    196,185    $     34,114           (25.0%)           475.1%
      Food and beverage                  15,791          16,131           2,875            (2.1%)           461.1%
      Retail, parking and other           3,977           4,133           1,200            (3.8%)           244.4%
  General and administrative             75,538          86,387          16,046           (12.6%)           438.4%
  Depreciation and amortization          11,812          26,339           5,107           (55.2%)           415.7%
  Provision for asset impairment             --         258,812              --          (100.0%)             N/A
  Pre-opening expenses                       --              --          35,160             N/A            (100.0%)
                                   ------------    ------------    ------------
      Total operating expenses     $    254,195    $    587,987    $     94,502           (56.8%)           522.2%
                                   ------------    ------------    ------------
</Table>


* Our operating expenses for 2000 and 1999 are not comparable.

         CASINO OPERATING EXPENSES. In 2001, we incurred casino expenses of
$147.1 million resulting in a gaming operating profit of $59.1 million. Casino
operating expenses decreased in 2001 primarily due to the reduction of our
annual minimum payment obligations to the Louisiana Gaming Control Board by $50
million after the first quarter of the year, resulting in a decrease of $35.6
million in our annual minimum payments during the last three quarters of the
year. For a discussion of the reduction in our annual minimum payments, which
became effective on April 1, 2001, refer to Note 1 to the consolidated financial
statements. The remaining decrease in casino operating expenses was primarily
due to lower labor costs related to operational efficiencies achieved through
improved staffing and scheduling practices and reduced costs related to various
broad-based marketing programs and promotions.

         Because the Casino did not open until October 28, 1999, our operating
expenses for 2000 and 1999 are not comparable. In 2000, we incurred Casino
expenses of $196.2 million resulting in a gaming operating profit of $15.8
million. Gaming operating expenses primarily consisted of the minimum daily
payments to the Louisiana Gaming Control Board required under our casino
operating contract, labor costs, player development and entertainment costs,
promotional costs, and security and surveillance related expenses. The high
fixed cost components associated with the business prior to our 2001 bankruptcy
adversely affected our ability to generate operating profits and maintain
adequate liquidity for ongoing operations.

         From October 28, 1999 to December 31, 1999, we incurred Casino expenses
of $34.1 million resulting in a gaming operating profit of $631,000. Gaming
operating expenses primarily consisted of the minimum gaming revenue share
payments to the Louisiana Gaming Control Board under Jazz Casino's casino
operating contract, labor costs, player development and entertainment costs,
promotional costs, and security and surveillance related expenses.

         FOOD AND BEVERAGE EXPENSES. In 2001, we incurred food and beverage
operating expenses of $15.8 million resulting in a food and beverage operating
profit of $5.9 million. Food and beverage expenses in 2001 decreased 2.1%
primarily due to lower labor costs related to operational efficiencies achieved
through improved staffing and scheduling practices and reduced costs related to
food and beverage raw materials.

         In 2000, we incurred food and beverage operating expenses of $16.1
million resulting in a food and beverage operating profit of $4.2 million. From
October 28, 1999 to December 31, 1999, we incurred food and beverage operating
expenses of $2.9 million, resulting in a food and beverage operating profit of
$818,000. Food and beverage operating expenses primarily consisted of labor
costs and food and beverage raw materials costs. Our food and beverage
operations and potential revenues from them were limited in 2000 and 1999 by the
contractual restrictions imposed by the Louisiana Gaming Control Board in
accordance with the terms of the Gaming Act. These restrictions


                                       22
<PAGE>

were lessened effective April 1, 2001 as a result of negotiations with the
Louisiana Gaming Control Board during the first quarter of 2001.

         RETAIL, PARKING, AND OTHER EXPENSES. In 2001, we incurred retail,
parking and other expenses of $4.0 million, resulting in retail, parking and
other operating profit of $6.8 million. Retail, parking, and other expenses in
2001 decreased by 3.8% due to lower labor costs related to operational
efficiencies achieved through improved staffing and scheduling practices.

         In 2000, we incurred retail, parking and other expenses of $4.1
million, resulting in retail, parking and other operating profit of $5.7
million. In 1999, we incurred retail, parking and other expenses of $1.2
million, resulting in retail, parking and other operating profit of $619,000.
Retail, parking and other operating expenses primarily consisted of the cost of
retail merchandise sold and expenses related to operating the Casino's two
parking facilities and providing an employee cafeteria.

         GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative
expenses decreased for the year ended December 31, 2001, primarily due to
negotiated price reductions related to various administrative services provided
by Harrah's Entertainment as well as a reduction in costs associated with public
relations efforts, advertising and live entertainment. During 2001, we incurred
charges totaling $2.0 million relating to severance and contract termination
costs.

         In 2000 and 1999, we incurred general and administrative expenses of
$86.4 million and $16.0 million, respectively. General and administrative
expenses consist primarily of city rental payments, salaries and wages of
administrative staff, advertising expenses, entertainment costs, and legal and
professional fees.

         DEPRECIATION AND AMORTIZATION EXPENSES. Depreciation expense decreased
in 2001 due to the reduced basis of our assets as a result of the provision for
asset impairment recorded in December 2000. In 2000 and 1999, we incurred
depreciation and amortization expenses of $26.3 million and $5.1 million,
respectively.

         PROVISION FOR ASSET IMPAIRMENT. We periodically evaluate whether events
and circumstances have occurred that indicate that certain assets may not be
recoverable. Management concluded from the results of an evaluation in late 2000
that a significant impairment of our long-lived assets had occurred and that an
impairment charge was required. Accordingly, during the fourth quarter of 2000,
we recorded an impairment charge of approximately $255.9 million and an
additional $2.9 million for the write-down of assets to be disposed of during
2000. See Note 3 to the consolidated financial statements for a discussion of
our asset impairment adjustments.

         PRE-OPENING EXPENSES. In 1999, we incurred pre-opening expenses of
$35.2 million consisting primarily of salaries and wages, legal and professional
fees, costs incurred to recruit and train employees to work in the Casino and
pre-opening marketing expenses.

         REORGANIZATION EXPENSES. During 2001, we incurred reorganization
expenses of $101.0 million. These expenses included a $90.3 million charge to
reflect the write off of the unamortized balance of the discount of the senior
subordinated notes, which were cancelled as a result of our Plan of
Reorganization. The remaining expenses consisted primarily of consulting and
legal fees, and costs associated with retention bonuses.

         PRECONFIRMATION CONTINGENCIES. During 2001, our 1998 bankruptcy
preconfirmation contingencies were reduced by $1.8 million due to changes in
estimates. During 1999, our 1998 bankruptcy preconfirmation contingencies were
reduced by $1.6 million due to a change in estimate. The remaining liability
represents management's assessment of the unresolved 2001 bankruptcy claims.

         OTHER INCOME (EXPENSE). In 2001, 2000 and 1999, we incurred interest
charges of $8.5 million, $46.7 million and $6.9 million, respectively. On
January 4, 2001, we filed a voluntary bankruptcy petition and ceased recording
interest expense related to our long-term debt and other obligations, except for
the debtor-in-possession loans made during the bankruptcy proceedings upon which
interest accrued through March 29, 2001, the effective date of our Plan of
Reorganization. The decrease in 2001 interest expense is due to the early
extinguishment of debt on March 29, 2001. Subsequent to March 29, 2001, we
incurred interest charges related to our $35.0 million revolving credit facility
and $124.5 million Senior Notes due 2008 of $8.0 million.



                                       23
<PAGE>

         Prior to October 28, 1999, the Company capitalized all interest
charges. In 2000 and from January 1, 1999 to October 27, 1999, we capitalized
interest of $140,000 and $21.7 million, respectively.

         For the years of 2001, 2000 and 1999, we generated interest income of
$437,000, $413,000 and $412,000, respectively, attributable primarily to
overnight repurchase investments of balances in our operating and capital
reserve accounts. In 2001, we generated other income of $1.1 million related to
the gain recognized on the sale of our Canal Place parking lot property.

         EXTRAORDINARY GAIN ON EARLY EXTINGUISHMENT OF DEBT. During the first
quarter of 2001, we recorded an extraordinary gain on the early extinguishment
of our debt of $213.4 million. This gain arises from the discharge of $317.0
million of outstanding principal and interest due to non-affiliates under our
senior subordinated notes with contingent payments due 2009, convertible junior
subordinated debentures and our non-affiliate bank term loans in exchange for
new debt and equity securities with a fair value of $103.6 million.

         INFLATION. To date, we believe inflation has not had a material impact
on our operations.

LIQUIDITY AND CAPITAL RESOURCES

         Our Plan of Reorganization reflects reorganization of our debt and
capital structure, in conjunction with a reduction in our $100 million minimum
annual payment to the State of Louisiana, a reduction in rent and certain other
charges imposed by the City of New Orleans and relief from certain operating
restrictions. The timing of our filing for reorganization, January 4, 2001, was
in part the result of our need to conclude our reorganization process prior to
March 31, 2001 to meet the obligations imposed by our casino operating contract
with the State of Louisiana and prevent closure of the Casino.

         Our confirmed Plan of Reorganization resulted in, among other things,
elimination of all of our common stock existing prior to March 29, 2001 and the
issuance of new securities to certain creditors in exchange for a reduction of
our obligations to them. The Casino remained open and continued operations
during the bankruptcy proceedings. No disruptions in employment or operations
were experienced.

         The following discussion of our performance should be read in
conjunction with and in light of our Plan of Reorganization, which was
consummated on March 29, 2001.

         WORKING CAPITAL FOR OPERATIONS. In 2001, net cash flow provided by
operations was $7.4 million. In 2000 and 1999, net cash flow used in operations
was $60.4 million and $38.9 million, respectively. A number of our contractual
agreements prior to our restructuring contained provisions that allowed us to
defer payment of certain operating expenses to help minimize our use of funds
prior to March 29, 2001. As of March 29, 2001, we had deferred a total of $45.6
million of payments to our manager, Harrah's Operating Company and Harrah's
Entertainment under the terms of the various agreements. Additionally, a total
of $28.5 million in interest payments related to our Senior Subordinated Notes
Due 2009 with contingent payments and our Convertible Junior Subordinated
Debentures had been paid in kind since October 1998. Under our credit agreement
in place prior to the bankruptcy and reorganization, $25.0 million was available
for working capital purposes under our revolving line of credit, which amount
was also used to partially cover operating losses. As of March 29, 2001, the
outstanding balance under the revolving line of credit was $25.0 million,
including outstanding letters of credit of $1.7 million.

         Under the HET/JCC agreement in effect prior to the bankruptcy, advances
by Harrah's Entertainment and Harrah's Operating Company under the minimum
payment guaranty constituted a demand obligation and were secured by first
priority liens on our assets. During various periods in 2001 and 2000, under the
terms of the minimum payment guaranty, HOCI began making the minimum daily
payments of approximately $274,000 due to the Louisiana Gaming Control Board
under our casino operating contract in order to provide us with necessary
working capital. As of March 29, 2001, Harrah's Entertainment and Harrah's
Operating Company had advanced




                                       24
<PAGE>

$51.8 million to the Louisiana Gaming Control Board on our behalf under the
minimum payment guaranty. Prior to the date of our bankruptcy filing on January
4, 2001, the principal balance outstanding was subject to interest at LIBOR plus
1%; subsequent to this date, the principal balance outstanding was subject to
interest at Prime plus 2% (10.0% as of March 29, 2001), which brought the total
balance due to $53.8 million including principal and interest.

         In connection with our Plan of Reorganization, the claims of the
various debt holders, including the claims of our senior noteholders, our bank
term loans, our revolving credit facility and the amounts funded by Harrah's
Entertainment pursuant to its guarantee, were settled in exchange for 1) the
Senior Notes issued by our subsidiary, Jazz Casino Company, LLC, with a face
amount of $124.5 million, and 2) approximately 12.4 million shares of our Common
Stock. We also entered into an agreement with Harrah's Entertainment to provide
us with a new $35 million revolving line of credit for the purpose of providing
working capital for the business. The unsecured claims resulting from amounts
owed to parties under the previous deferral arrangements were also eliminated.

         This significant reduction in debt, coupled with the reduction in the
minimum annual payment to the Louisiana Gaming Control Board and other
adjustments to our operating expenses, resulted in a positive impact to cash
flow for the nine months following the restructuring. For the nine months since
the reorganization (April 1 through December 31, 2001), net cash flow provided
by operations was $13.8 million.

         Our Senior Notes provide for quarterly interest payments at a rate
equal to LIBOR plus 2.75% annually. During the first year, 50% of the interest
payments on the notes may be paid in kind at the borrower's option. Our new
revolving credit agreement requires that we pay 50% of the interest payments on
the Senior Notes during the first year in kind. As of December 31, 2001, we have
paid $3.4 million in cash interest and paid $3.1 million in interest in kind by
issuing additional Senior Notes. Principal payments on these notes are to be
made semi-annually on November 15 and May 15 of each year commencing November
2002. Until May 2005, the payments are calculated at 50% of semi annual free
cash flow, as defined in the Indenture governing our Senior Notes. Commencing
September 30, 2005, principal payments of $1.5 million per quarter are due, with
one final payment of all amounts due at March 31, 2008.

         Our new revolving credit agreement is provided by Harrah's Operating
Company and provides an available line of credit of up to $35 million, with a
letter of credit sublimit of $10 million. Interest is payable at LIBOR plus 3%.
The facility matures on March 30, 2006, subject to extension until March 30,
2007 at our option. The revolver will be used to fund our operating needs that
are not fulfilled by cash flows from operations of our Casino. As of March 1,
2002, there were no outstanding borrowings and $700,000 in outstanding letters
of credit issued under this revolving credit facility.

         In addition to the capital and debt changes to our structure outlined
above, some material reductions to our operating expense structure came about as
a result of the implementation of our Plan of Reorganization, as discussed
below.

         The gaming payments to the State of Louisiana required by our casino
operating contract were reduced to the greater of 21.5% of gross gaming revenue
or (i) $50 million in the first year ended March 31, 2002, and $60 million each
fiscal year thereafter, or (iii) the sum of a sliding scale of gross gaming
revenues that begins at 21.5% for gross gaming revenues up to $500 million and
escalates to a high of 29% for revenues in excess of $900 million. The casino
operating contract requires a rolling three year guaranty of this amount, with
an initial four year unconditional guaranty. In connection with our Plan of
Reorganization, we entered into the HET/JCC Agreement, pursuant to which
Harrah's Entertainment has agreed to provide the initial four year unconditional
guaranty of the required minimum payment to the State of Louisiana. Harrah's
Entertainment will receive an annual fee from Jazz Casino in exchange for
providing this guaranty. The obligations under this guaranty are secured by,
among other things, a first lien on substantially all of our assets.

         Additionally, in connection with our Plan of Reorganization, the City
of New Orleans agreed to reduce the payments and other impositions required in
connection with our lease with the City by $5 million per year. We entered into
the amended ground lease whereby the City of New Orleans had agreed to designate
the sources of the savings within 120 days from March 15, 2001, which date was
later extended by 30 days. On August 15, 2001, the special development projects
committee of the City Council recommended reductions to the Council with which
we




                                       25
<PAGE>

disagreed. Subsequently, we filed a motion with the Bankruptcy Court asking it
to review the proposed reductions for their consistency with our Plan of
Reorganization. Over the following months we worked with the special development
projects committee to develop a list of lease modifications and other items that
we could agree upon, and on January 17, 2002, the City Council approved an
ordinance and lease amendments that delineate these changes as outlined below.
Each item agreed upon either reduces payments required under the amended ground
lease, or lifts some operating restriction that we believe will result in
improved operating performance by providing cost savings other than the lease
payments or by providing additional revenue opportunities. The following is a
summary of the material items agreed upon:

                  o        Jazz Casino granted an annual credit of $2.1 million
                           in property tax reduction toward the total reduction,
                           including the property tax reduction achieved in
                           2001;

                  o        A small lot on the corner of Fulton and Poydras
                           Streets, which was previously conveyed by Jazz
                           Casino's predecessors to the City of New Orleans,
                           will be returned to Jazz Casino either in fee title,
                           if the law allows, or pursuant to a ninety-nine year
                           lease, independent of the amended ground lease;

                  o        A lease amendment that commits the City to support,
                           assist and cooperate with the development of a hotel
                           on the Fulton Street property;

                  o        A City commitment to support, assist and cooperate
                           with our efforts to obtain approvals and permits for
                           all future development. The agreement places time
                           limits on Rivergate Development Corporation review
                           and approval when such is necessary for City
                           permitting;

                  o        Jazz Casino gained permission to own and operate two
                           courtesy cars and one courtesy bus. The agreement
                           stipulates that if permits are unreasonably denied,
                           Jazz Casino may deduct payments of up to $1 million
                           from the minimum rent payment to the City;

                  o        The language of the amended ground lease was
                           conformed to reflect the recent changes in Louisiana
                           law with respect to food services, hotel development
                           and providing complimentary services;

                  o        A number of significant adjustments to the reporting,
                           record keeping and other administrative requirements
                           of the open access program and plans, designed to
                           facilitate participation by minorities, women and
                           disadvantaged persons and business enterprises in
                           developing, constructing and operating the Casino,
                           which will result in cost savings and reduction of
                           exposure for defaults under that plan;

                  o        The City will agree to a reduction in the number of
                           parking spaces required to be dedicated to Casino use
                           provided we demonstrate that they are not needed to
                           meet Casino use. As a result, any spaces freed up by
                           the reduction, up to 700 spaces, may be rented by
                           Jazz Casino to third parties under week-day parking
                           contracts, which would provide additional revenue to
                           us; and

                  o        Mutual waivers of any defaults that any parties can
                           allege up to the effective date of the amendments and
                           a requirement of the dismissal of all legal
                           proceedings filed by any parties as a result of the
                           $5 million reduction issue.

         On January 28, 2002, the Mayor of New Orleans signed the ordinance
effecting the above changes and on February 7, 2002, the lease amendment was
signed by all parties.

         Since emerging from bankruptcy, we have continued to seek ways to
improve the financial performance of the Casino to assist in making the Company
financially stable over the long term. After extensive analysis and evaluation
concerning operating efficiencies, we have, among other things, reduced the
Casino's work force by eliminating 148 positions on July 17, 2001. Our
agreements with the State preclude us from reducing our employment levels below
certain thresholds, which were calculated based on employment and compensation
levels




                                       26
<PAGE>

at the Casino during March 2001. In addition, our agreement with the City
creates certain obligations with respect to employment levels. There are no
pending City or State actions regarding our current employment levels.

         We currently expect payments on our short-term obligations to be made
from cash flows from operations. Even taking into consideration the reduced
liabilities and operating expenses as a result of the reorganization, and
further reductions in operating expenses post-restructuring, we cannot assure
that we will have sufficient liquidity to meet our long-term obligations.

         LOSSES BEFORE INTEREST, INCOME TAXES, DEPRECIATION, AND AMORTIZATION.
Losses before interest, income taxes, depreciation, and amortization ("EBITDA"),
adjusted for certain non-recurring items for 2001, 2000 and 1999 was $2.2
million, $60.3 million, and $12.0 million, respectively. EBITDA adjusted for
certain non-recurring items for the nine months ended December 31, 2001 (since
the reorganization) was a positive $12.7 million. The improvement in EBITDA is
related primarily to the decrease in the minimum annual payment to the State of
Louisiana of $35.6 million for this period, accompanied by operating
efficiencies achieved in Casino operations.

         EBITDA should not be construed as a substitute for operating income or
a better indicator of liquidity than cash flow from operating, investing and
financing activities, which are determined in accordance with generally accepted
accounting principles ("GAAP"), and it is included herein to provide additional
information with respect to our ability to meet our future debt service, capital
expenditure and working capital requirements. Although EBITDA is not necessarily
a measure of our ability to fund our cash needs, management believes that EBITDA
is a useful tool for measuring our ability to service our debt. Our definition
of EBITDA may not be the same as that of similarly captioned measures used by
other companies.

         Under our amended management agreement, there are performance targets
that the Manager must meet for each twelve month period ended March 31,
beginning with the twelve months ended March 31, 2002. Under the terms of the
amended management agreement, failure to meet these targets, unless such failure
is the result of a force majeure as defined in the management agreement, could
result in termination of the agreement. The targets, which have been previously
established for the first three fiscal periods, are based on a calculation of
earnings before interest, income taxes, depreciation, amortization and
management fees, adjusted for certain state and city costs, and corporate
overhead costs ("Adjusted EBITDAM"). For the twelve months ended March 31, 2002,
the target Adjusted EBITDAM is 85% of $115.2 million, or $97.9 million. For the
nine months ended December 31, 2001, Adjusted EBITDAM was $77.9 million.

         CAPITAL EXPENDITURES. Pursuant to our amended and restated ground lease
with the Rivergate Development Corporation and the City of New Orleans, our
management agreement with Harrah's New Orleans Management Company and our casino
operating contract, we established a capital replacement fund to fund the
capital expenditures necessary to operate the Casino. We were contractually
required to fund monthly payments into the capital replacement fund in an
aggregate amount equal to $3 million for the first 12 months following the
Casino's opening, $4 million for the second 12 months following the Casino's
opening, $5 million for the third 12 months following the Casino's opening, and
2% of the gross revenues of the Casino for each fiscal year thereafter. As of
December 31, 2001, we had deposited $7.4 million into the interest-bearing
capital reserve account and expended approximately $4.5 million.

         As a result of our Plan of Reorganization, we are now free to expand
our seated buffet facilities from 250 to 400 seats and develop a full service
restaurant with seating for 150 people. We have not yet determined how much
capital will be required to expand our dining facilities, but we are in the
process of finalizing plans and budgets for this expansion. We intend to
commence such expansion during 2002. The funds for such expansion and
development will need to be obtained from cash flow from operations or external
financing.

         CAPITAL RESOURCES FOR DEVELOPMENT ACTIVITIES. In addition to the gaming
related entertainment offered at the Casino, as funding and circumstances may
permit, we plan to develop additional real estate in New Orleans for
entertainment and other uses that support the Casino. The second floor of our
Casino was constructed to the point at which the shell of the structure was
complete when the Casino opened in October 1999. The Casino's second floor was
planned to ultimately consist of approximately 130,000 square feet of
multipurpose non-gaming entertainment space.



                                       27
<PAGE>

         We have spent approximately $1.7 million through December 31, 2001
towards developing a master plan for the build out and leasing of the second
floor of the Casino for non-gaming uses and for construction-related work that
needed to take place on the second floor of the Casino prior to opening the
Casino in order to prevent disruption to the Casino's gaming operations. We
presented a preliminary master plan governing the use of the second floor of the
Casino to the City of New Orleans on February 22, 2000 and are currently
considering alternatives for financing the remainder of this development.
Without additional financing, we will be unable to build-out and develop the
second floor of the Casino. Other than the proceeds from the sale of land
mentioned below, we have not obtained sufficient financing to fund these
developments, and cannot assure that we will ever be able to do so.

         We also owned the parcel of land across from the Casino located at 3
Canal Place, adjacent to the Canal Place Shopping Center. On October 15, 2001,
we closed on the sale of this property to CP3 Associates, LLC. The sale netted
approximately $6 million, and we plan to use these funds for development needs,
including second floor development, subject to any limitations imposed by our
financing documents. These funds, however, are not sufficient to complete
development of the second floor.

         We also own the city block of historical buildings across the street
from the Casino and its garages, which we have planned to either sell or to
develop into entertainment or other uses that support the Casino. At this time,
we have not completed our plans and have not obtained financing for this
development.

         CAPITAL RESOURCES FOR CONSTRUCTION PROJECTS. From October 30, 1998
until the Casino's opening on October 28, 1999, our principal capital
requirements related to constructing the Casino. As of December 31, 2001, all
construction and pre-opening invoices had been paid. However, there were several
remaining unresolved creditor claims from the 1995 bankruptcy of our
predecessor, Harrah's Jazz Company, which also became claims in the 2001
bankruptcy. These claims have since been resolved and paid from funds previously
set aside.

         SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES. We prepare our
consolidated financial statements in conformity with accounting principles
generally accepted in the United States of America. Certain of our accounting
policies, including the estimated lives assigned to our assets, the evaluation
of uncollectible accounts receivable, preconfirmation contingencies, self
insurance accruals, note discount, valuation allowance for deferred taxes, and
asset impairment require that we apply significant judgment in defining the
appropriate assumptions for calculating financial estimates. By their nature,
these judgments are subject to an inherent degree of uncertainty. Our judgments
are based on our historical experience, terms of existing contracts, our
observance of trends in the industry, information provided to us by our
customers and information available from other outside sources, as appropriate.
To provide an understanding of the methodology we apply, our significant
accounting policies are discussed where appropriate in this discussion and
analysis and in the notes to our consolidated financial statements. See Note 2
to the consolidated financial statements for a summary of our significant
accounting policies.

         RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS. In the first quarter of
2001, the Emerging Issues Task Force ("EITF") reached a consensus on certain
issues in EITF 00-22 "Accounting for "Points" and Certain Other Time-Based or
Volume-Based Sales Incentive Offers, and Offers for Free Products or Services to
Be Delivered in the Future." EITF 00-22 requires that cash rebates or refunds be
shown as a reduction of revenues effective for quarters ending after February
15, 2001. In 2001, the EITF also reached a consensus on certain issues in EITF
00-14 "Accounting for Certain Sales Incentives." EITF 00-14 requires that the
reduction in or refund of the selling price of the product or service resulting
from any cash sales incentive should be classified as a reduction in revenues
effective no later than in annual or interim financial statements for the
periods beginning after December 15, 2001. We adopted the consensus provisions
of EITF 00-22 and EITF 00-14 in the first quarter 2001 and the fourth quarter
2001, respectively. To be consistent with the 2001 presentation, various "cash
back" rewards and cash sales incentives, previously shown as casino expenses,
were reclassified as a reduction in revenues in 2000 and 1999. This did not have
any effect on previously reported operating income (loss) or net income (loss).
The cash back rewards and cash sales incentives for 2001, 2000, and 1999 were
$18.6 million, $19.0 million, and $899,000, respectively.

         The Financial Accounting Standards Board has issued Statement of
Financial Accounting Standards ("SFAS") No. 141 "Business Combinations" and No.
142 "Goodwill and Other Intangible Assets." Both statements were issued in June
2001. SFAS No. 141 requires that the purchase method of accounting be used for
all business combinations initiated after June 30, 2001 and that the use of the
pooling-of-interests method is no longer allowed.




                                       28
<PAGE>

SFAS No. 142 requires that upon adoption, amortization of goodwill will cease
and instead, the carrying value of goodwill will be evaluated for impairment on
an annual basis. Identifiable intangible assets will continue to be amortized
over their useful lives and reviewed for impairment in accordance with SFAS No.
121 "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of." SFAS No. 142 is effective for fiscal years beginning
after December 15, 2001. We are evaluating the impact of the adoption of those
standards and have not yet determined the effect of adoption on our financial
position and results of operations. Management does not believe these Standards
will have a significant impact on our financial position and results of
operations.

         SFAS No. 143, "Accounting for Asset Retirement Obligations", was issued
during June 2001. SFAS No. 143 establishes accounting standards for the
recognition and measurement of an asset retirement obligation and its associated
asset retirement cost. It also provides accounting guidance for legal
obligations associated with the retirement of tangible long-lived assets. SFAS
No. 143 is effective in fiscal years beginning after June 15, 2002, with early
adoption permitted. Management does not believe this Standard will have a
significant impact on our financial position and results of operations.

         SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets" was issued during August 2001. SFAS No. 144 establishes a single
accounting model for the impairment or disposal of long-lived assets, including
discontinued operations. SFAS No. 144 superseded SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of"
and APB Opinion No. 30, "Reporting the Results of Operations - Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions." The provisions of SFAS No. 144
are effective in fiscal years beginning after December 15, 2001, with early
adoption permitted, and in general are to be applied prospectively. Management
does not believe this Standard will have a significant impact on our financial
position and results of operations.

FACTORS AFFECTING FUTURE PERFORMANCE

         The following discussion should be read with our current Plan of
Reorganization in mind. The discussion is prospective and should be considered
in light of our ongoing operations as contemplated by our Plan of
Reorganization.

GAMING LAWS AND REGULATIONS COULD ADVERSELY AFFECT OUR OPERATIONS

         Future state legislation could adversely affect our operations. We
cannot assure you that the Louisiana legislature will not enact legislation that
imposes obligations, restrictions or costs that could interfere with Jazz
Casino's casino operations, cause Jazz Casino to violate agreements to which it
is a party or otherwise materially and adversely affect us. Because legalized
gaming is a relatively new industry in Louisiana, over the past few years the
Louisiana state legislature has given a significant amount of attention to
gaming related bills, many of which could impact the Casino. For example, at
various times, bills have been introduced to:

         o        constitutionally and/or legislatively repeal all forms of
                  gaming (including gaming at the Casino);

         o        increase taxes on riverboat casinos (such a bill passed in
                  March 2001);

         o        permit dockside riverboat gaming (such a bill passed in March
                  2001);

         o        limit credit that may be extended by casinos;

         o        mandate payout schedules for slot machines; and

         o        limit days and hours of casino operations.

         We cannot be certain that Louisiana will not subsequently enact new
legislation that modifies or revokes our right to conduct gaming activities or
otherwise materially and adversely affects our business and operations. For
example, in the spring of 1996, the Louisiana legislature passed legislation
that called for a parish-by-parish referendum to decide, on an item-by-item
basis, whether riverboat gaming, video poker gaming and, in Orleans Parish, a
land-based casino should be permitted to operate in the parish. Although, on
November 5, 1996, voters in Orleans




                                       29
<PAGE>

Parish elected to permit land-based casino gaming, riverboat gaming and video
poker gaming in Orleans Parish, if similar legislation is enacted in the future,
it could lead to the Casino's gaming operations being suspended or permanently
prohibited. In addition, the State of Louisiana could increase competition by
authorizing additional riverboats or other forms of gaming or other land-based
casinos in Orleans Parish or elsewhere in Louisiana. For example, in 1997, the
Louisiana legislature authorized the use of slot machines at racetracks in three
parishes in Louisiana (but not Orleans Parish) subject to a 15,000 square foot
limitation, and in 2001 it passed legislation authorizing dockside gaming. In
addition, other legislative changes, such as broadened food service
restrictions, could materially and adversely affect our business, financial
condition and results of operations.

         Jazz Casino and certain of its affiliates must be found suitable under
Louisiana law. Jazz Casino was not permitted to operate the Casino unless and
until certain persons were found suitable by the Louisiana Gaming Control Board.
These persons include (1) Jazz Casino, (2) JCC Holding, (3) Harrah's
Entertainment, (4) the Manager, and (5) certain members, officers and directors
of these companies. In addition, additional officers and directors of Jazz
Casino, JCC Holding or the Manager may be required to be found suitable. Once
found suitable, entities and persons that are required to be suitable have an
ongoing obligation to maintain their suitability throughout the term of the
casino operating contract. Jazz Casino's and the Manager's suitability also may
be adversely affected by persons associated with them and their respective
affiliates, over whom Jazz Casino and the Manager have no control. If Jazz
Casino or the Manager is found unsuitable and, as a consequence, our casino
operating contract is revoked, it would materially and adversely affect our
business, financial condition and results of operations.

         The Gaming Act, its rules and regulations, and the casino operating
contract also impose certain suitability requirements on the holders of our debt
instruments and equity.

         We and our debt and equity holders (resulting from our Plan of
Reorganization) could be the subject of regulatory enforcement actions. The
Louisiana Gaming Control Board is empowered to sanction Jazz Casino, JCC
Holding, the Manager, holders of debt and equity of Jazz Casino and its
affiliates, including JCC Holding, and people that hold permits, licenses or
that are required to be found suitable by the Louisiana Gaming Control Board for
violations of the Gaming Act and the rules and regulations promulgated
thereunder. If Jazz Casino, Jazz Casino's employees, JCC Holding or the Manager
fails to comply with the Gaming Act, its rules and regulations or regulatory
requirements in our casino operating contract, including suitability
requirements, it could materially and adversely affect us and holders of our
debt and equity. For example, we could be subject to fines, suspension of our
rights granted by the casino operating contract and, under certain
circumstances, revocation or termination of our casino operating contract. In
addition, if any holder of our debt instruments or equity is required to be
suitable and fails to be found suitable, the holder may be required to sell or
otherwise divest such securities at substantially below-market prices.

         We may not be able to enforce our contractual rights against the State
of Louisiana. Under our casino operating contract, we are entitled to bring an
action to compel specific performance or any other remedy permitted or provided
by law if the Louisiana Gaming Control Board breaches the contract and fails to
cure the breach. In the spring of 1996, however, the Louisiana legislature
enacted a bill that purports to amend the Gaming Act to provide the State of
Louisiana and all of its subdivisions (including the Louisiana Gaming Control
Board) with immunity from suit and liability for any action or failure to act on
the part of Louisiana or any of its political subdivisions (including the
Louisiana Gaming Control Board). We cannot assure you that in the event we seek
to enforce our rights under the casino operating contact, a court would allow
the suit to proceed. If the Louisiana Gaming Control Board fails to comply with
the casino operating contract, it could materially and adversely affect our
business, financial condition and results of operations. This adverse affect
would be exacerbated if a court applied the immunity statute.

         Our operations could be subject to future federal legislation. In 1996,
Congress enacted a law creating a federal commission to study the economic and
social impact of gaming and report its findings to Congress and the President. A
report was issued by the commission in June 1999. We cannot determine the
possible impact of this report on future legislation that may impact the gaming
industry. We cannot be certain that the report will not result in new laws or
regulations that would adversely impact the gaming industry in general and the
Casino in particular.



                                       30
<PAGE>

THE POLITICAL ENVIRONMENT IN LOUISIANA COULD ADVERSELY AFFECT OUR ABILITY TO
OPERATE THE CASINO OR DEVELOP OUR OTHER PROPERTIES

         Louisiana state and local politics have affected, and will continue to
affect, the Casino's development and may affect the Casino's operation. There is
considerable opposition to gaming among a segment of the population in
Louisiana. The enactment and implementation of gaming legislation in Louisiana
and the Casino's development have been the subject of lawsuits, claims and
delays brought about by various anti-gaming and preservationist groups and
competitors of the Casino. Although these lawsuits and claims have all been
settled or dismissed, these lawsuits and claims, together with contract
negotiations with Louisiana and New Orleans governmental entities, significantly
delayed the Casino's development. Additional lawsuits and the uncertain
political environment may result in further delays, all of which could
materially and adversely affect our business, financial condition and results of
operations.

WE MAY NOT BE ABLE TO RENEW OUR MINIMUM PAYMENT GUARANTY

         Under the terms of our casino operating contract, as amended pursuant
to our Plan of Reorganization, we are required to pay at least $50 million per
year in our first year of operations and at least $60 million per year for each
year thereafter to the State of Louisiana. In addition, at the beginning of each
casino operating contract fiscal year there must be in place at least 36 months
of third party guaranteed minimum payments to the State. Harrah's Entertainment
and Harrah's Operating Company agreed to post the guaranty for four years
through March 31, 2005, but not for the entire term of the casino operating
contract. On or before March 31, 2003 we are required to cause a third party to
post a guaranty of the minimum payment for the casino operating contract fiscal
year beginning April 1, 2005 and ended March 31, 2006. This renewal requirement
continues for each year that we operate, subject to certain limitations. There
can be no assurance that we will be able to obtain a minimum payment guarantor
for a renewal period during the term of our casino operating contract.

LACK OF PROFITABILITY

         We cannot predict the number of visitors to the Casino, their
propensity to wager or the success of land based gaming in New Orleans, a market
that did not include significant land based gaming operations before 1999. For
the years ended December 31, 2001, 2000, and 1999, we sustained net operating
losses of $15.5 million, $345.9 million, and $54.2 million, respectively. Since
the opening through the quarter ended June 30, 2001 we did not post a positive
operating cash flow. Throughout these time periods our revenues were lower than
expected relative to our fixed and variable expenses. In addition, despite
achieving operating income for the quarter ended September 30, 2001, we reported
a net loss for that quarter as a result of our significant debt service. Third
quarter operating results were weaker than expected, primarily due to decreased
tourist and conventioneer traffic in New Orleans, coupled with the adverse
effects on tourism of the terrorist attacks in the United States on September
11, 2001. We have taken actions to reduce our variable expenses, including a
reduction in personnel, but revenues have continued to fall short of our
projections. While we have also taken action to increase our revenues through
marketing initiatives, player incentives, customer service initiatives and other
means we cannot predict the results of these efforts. As a result, there can be
no assurance that we will be able to operate the Casino in a profitable manner.

JAZZ CASINO MAY HAVE NO RECOURSE IF ADDITIONAL LAND-BASED CASINOS ARE PERMITTED

         The Gaming Act presently restricts land-based casino gaming in Orleans
Parish to the site on which the Casino is presently located, at the foot of
Canal and Poydras Streets on the site of New Orleans' former Rivergate
Convention Center. However, we cannot assure that the State of Louisiana will
not enact future legislation that would permit competing land-based casinos at
other sites or in parishes other than Orleans Parish, including other parishes
in the New Orleans metropolitan area. If an additional land-based casino gaming
establishment is authorized to operate in Orleans Parish, Jazz Casino would not
have to pay the Louisiana Gaming Control Board the compensation required under
the provisions of its casino operating contract, although this obligation may
resume pursuant to the terms of the casino operating contract. Additional
land-based casino operations could materially and adversely affect the Casino's
operations by increasing the amount of competition it faces.



                                       31
<PAGE>

OUR OPERATIONS DEPEND ON GAMING OPERATIONS IN A SINGLE MARKET

         We do not have and do not presently anticipate having operations other
than the Casino and operations that support the Casino. Therefore, we depend
solely upon visitors to New Orleans and New Orleans area residents for our
revenue. As a result, any of the following occurrences could negatively impact
the Casino's operations, which could materially and adversely affect our
business, financial condition and results of operations:

         o        a downturn in the local or regional economy;

         o        a decline in tourism in New Orleans;

         o        a decline in the New Orleans gaming market;

         o        an increase in competition faced by the Casino; or

         o        a reduction or cessation of activities at the Casino due to
                  flooding, severe weather, natural disasters or otherwise.

WE MAY NOT BE ABLE TO DEVELOP CERTAIN OF OUR PROPERTIES

         We cannot complete our anticipated build-out of the non-gaming tenant
improvements on the second floor of the Casino until, among other things, the
master plan governing the use of the second floor is approved, tenant leases are
obtained, the necessary financing is secured and a conditional use permit is
obtained. In addition, we will be unable to develop the property located on
Fulton and Poydras Streets for entertainment uses that support the Casino until,
among other things, we obtain the necessary financing. We have not completed
plans for the development of this property. We may not be able to obtain the
necessary financing and satisfy the other conditions to developing the
non-gaming tenant improvements on the second floor of the Casino, including any
restaurant facilities we may wish to develop to take advantage of the newly
lessened restrictions on our provision of restaurant facilities, or the property
located on Fulton and Poydras Streets. The failure to develop these properties
could materially and adversely affect our ongoing business, financial condition
and results of operations.

THE MANAGER AND CERTAIN OF OUR DIRECTORS HAVE CONFLICTS OF INTERESTS REGARDING
THE CASINO

       Harrah's Entertainment owns or controls (indirectly through one or more
subsidiaries or affiliates) dockside casinos in Vicksburg and Tunica,
Mississippi, Shreveport and two riverboat casinos in Lake Charles, Louisiana.
These casinos, together with other casinos that Harrah's Entertainment (or one
or more of its subsidiaries or affiliates) may develop, compete with the Casino
at a regional level. Harrah's Entertainment also owns or controls (indirectly
through one or more subsidiaries or affiliates) casinos in the five major Nevada
and New Jersey gaming markets, which casinos compete with the Casino on a
national basis. Currently, the Chairman of our board of directors, Mr. Philip G.
Satre, is also (1) the Chairman of the Board and Chief Executive Officer of
Harrah's Entertainment, and (2) the Chairman of the Board and Chief Executive
Officer of Harrah's New Orleans Management Company. Eddie N. Williams is a
director on our board and a director of Harrah's Entertainment. Anthony
Sanfilippo, a director on our board, is also the President of the Central
Division of Harrah's Entertainment, and President and Chief Operating Officer of
Harrah's New Orleans Management Company. Under Jazz Casino's management
agreement with the Manager, the Manager, a wholly-owned subsidiary of Harrah's
Entertainment, has been exclusively responsible for supervising and managing the
Casino. As a result of Harrah's Entertainment's ownership of casinos that may,
or currently, compete with our casino, together with its ownership of the
Manager and the positions held by Messrs. Satre and Sanfilippo as officers or
directors of Harrah's Entertainment, and by Mr. Williams, as a director 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 Harrah's Entertainment's
competing casinos. The indenture governing the Senior Notes, our credit
agreement and our management agreement with the Manager each have imposed
restrictions on our ability to enter into transactions with affiliates,
including Harrah's Entertainment. In addition, our board of directors has
implemented procedures that require transactions with Harrah's Entertainment and
its affiliates to be approved by disinterested directors. We cannot assure,
however, that the restrictions in these




                                       32
<PAGE>

agreements or these procedures will successfully resolve conflicts of interest
confronting, or which may confront, us. Refer to Note 8 to the consolidated
financial statements for disclosure of related party transactions.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         We do not engage in trading market risk sensitive instruments. We also
do not purchase, for investment, hedging or for purposes "other than trading,"
instruments that are likely to expose us to market risk, whether interest rate,
foreign currency exchange, commodity price or equity price risk, except as
discussed in the following paragraph. We have not entered into any forward or
futures contracts, purchased any options or entered into any swaps. We have no
foreign operations and currently do not deal in foreign currencies. Thus, we do
not believe that we have any material exposure to foreign currency exchange rate
risk.

         We have a significant amount of indebtedness, which accrues interest at
variable rates. As of December 31, 2001, the aggregate face amount of our
outstanding indebtedness was $127.6 million. The interest rate of our variable
rate indebtedness will fluctuate with changes in the LIBOR rate applicable under
our credit agreement. A change in either the base rate or LIBOR under our credit
agreement will affect the interest rate at which indebtedness outstanding under
the credit agreement accrues. As a result, a significant increase in LIBOR could
materially and adversely affect our financial position and results of
operations. For example, a 50 basis point movement in interest rates would
result in an approximate $638,000 annualized increase or decrease in interest
expense based on the outstanding balance of our variable rate indebtedness as of
December 31, 2001.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.




                                       33
<PAGE>





                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders
of JCC Holding Company
New Orleans, LA

         We have audited the accompanying consolidated balance sheets of JCC
Holding Company and subsidiaries (the "Company") as of December 31, 2001 and
2000, and the related consolidated statements of operations, stockholders'
equity (deficit) and cash flows for the years ended December 31, 2001, 2000, and
1999. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

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

         As discussed in Note 1, the Company filed for reorganization under
Chapter 11 of the Federal Bankruptcy Code on January 4, 2001. The Bankruptcy
Court entered an order confirming the plan of reorganization, which became
effective on March 29, 2001. The consequences of this bankruptcy proceeding have
been reflected in the accompanying financial statements as of the effective date
of reorganization.

         In our opinion, such consolidated financial statements present fairly,
in all material respects, the financial position of JCC Holding Company and
subsidiaries as of December 31, 2001 and 2000, and the results of their
operations and their cash flows for the years ended December 31, 2001, 2000 and
1999 in conformity with accounting principles generally accepted in the United
States of America.


/s/ DELOITTE & TOUCHE LLP

New Orleans, Louisiana
February 22, 2002







                                       34
<PAGE>



                      JCC HOLDING COMPANY AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2001 AND 2000
                     (IN THOUSANDS, EXCEPT PER SHARE DATA)


<Table>
<Caption>

                                                                          DECEMBER 31,     DECEMBER 31,
                                                                              2001             2000
                                                                          ------------     ------------
<S>                                                                       <C>              <C>
                               ASSETS
Current Assets:
   Cash and cash equivalents (includes restricted
        cash of $3,253 and $2,113, respectively)                          $     41,702     $     26,626
   Accounts receivable, net of allowance for doubtful
        accounts of $4,022 and $1,958, respectively                              3,414            6,272
   Inventories                                                                     639              685
   Prepaids and other assets                                                     2,162            3,678
   Property available for sale                                                      --            4,831
                                                                          ------------     ------------
             Total current assets                                               47,917           42,092
                                                                          ------------     ------------
Property and Equipment:
   Buildings on leased land                                                    129,027          128,936
   Furniture, fixtures and equipment                                            28,406           22,492
   Property held for development                                                10,708           10,689
   Leasehold improvements                                                          284              245
   Construction in progress                                                        309               89
                                                                          ------------     ------------
             Total                                                             168,734          162,451
   Less - accumulated depreciation                                             (35,253)         (25,561)
                                                                          ------------     ------------
             Net property and equipment                                        133,481          136,890
                                                                          ------------     ------------
Other Assets:
   Deferred operating contract cost, net of accumulated
        amortization of $4,351 and $3,269, respectively                         24,454           25,536
   Lease prepayment, net of accumulated
        amortization of $1,082 and $816, respectively                            6,046            6,312
   Deferred charges and other, net of accumulated
        amortization of $2,320 and $1,567, respectively                         11,225           10,631
                                                                          ------------     ------------
             Total other assets                                                 41,725           42,479
                                                                          ------------     ------------
             Total Assets                                                 $    223,123     $    221,461
                                                                          ============     ============

              LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
   Short-term borrowings                                                  $         --     $     23,250
   Accounts payable - trade                                                      2,196              844
   Accrued interest                                                                 --            7,025
   Accrued expenses                                                             17,231           12,301
   Due to affiliates                                                             4,591           64,806
   Preconfirmation contingencies                                                   900            2,212
   Other                                                                         2,036            1,977
                                                                          ------------     ------------
             Total current liabilities                                          26,954          112,415
                                                                          ------------     ------------
Long-term debt, net of discount (including debt to affiliates of
        $43,824 and $31,947, respectively)                                     105,676          396,412
Due to affiliates                                                                2,050           20,968
Other long-term liabilities                                                        428              339

Commitments and Contingencies
Stockholders' Equity (Deficit):
   Common Stock:
      Common Stock (40,000 shares authorized; 12,386 shares
         issued and outstanding; par value $.01 per share)                         124               --
      Unclassified Common Stock (40,000 shares authorized; none
         issued and outstanding; par value $.01 per share)                          --               --
      Class A Common Stock (20,000 shares authorized;
         5,778 shares issued and outstanding;
         par value $.01 per share)                                                  --               58
      Class B Common Stock (20,000 shares authorized; 4,453 shares
         issued and outstanding; par value $.01 per share)                          --               45
   Additional paid-in capital                                                  413,150          108,269
   Accumulated deficit                                                        (325,259)        (417,045)
                                                                          ------------     ------------
         Total stockholders' equity (deficit)                                   88,015         (308,673)
                                                                          ------------     ------------
         Total Liabilities and Stockholders' Equity (Deficit)             $    223,123     $    221,461
                                                                          ============     ============
</Table>

See Notes to Consolidated Financial Statements.






                                       35
<PAGE>



                      JCC HOLDING COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
                        (IN THOUSANDS, EXCEPT SHARE DATA)

<Table>
<Caption>

                                                             FOR THE YEARS ENDED DECEMBER 31,
                                                      ----------------------------------------------
                                                          2001             2000             1999
                                                      ------------     ------------     ------------
<S>                                                   <C>              <C>              <C>
Revenues:
    Casino                                            $    242,950     $    245,473     $     38,005
    Food and beverage                                       21,673           20,356            3,693
    Retail, parking and other                               10,816            9,821            1,819
    Less - casino promotional allowances                   (36,792)         (33,536)          (3,260)
                                                      ------------     ------------     ------------
       Total net revenues                                  238,647          242,114           40,257
                                                      ------------     ------------     ------------
Operating Expenses:
   Direct:
      Casino                                               147,077          196,185           34,114
      Food and beverage                                     15,791           16,131            2,875
      Retail, parking and other                              3,977            4,133            1,200
   General and administrative                               75,538           86,387           16,046
   Depreciation and amortization                            11,812           26,339            5,107
   Provision for asset impairment                               --          258,812               --
   Pre-opening expenses                                         --               --           35,160
                                                      ------------     ------------     ------------
      Total operating expenses                             254,195          587,987           94,502
                                                      ------------     ------------     ------------

Operating Loss                                             (15,548)        (345,873)         (54,245)
                                                      ------------     ------------     ------------
Reorganization Expenses                                   (101,029)              --               --
Preconfirmation Contingencies                                1,824               --            1,562

Other Income (Expense)
   Interest expense, net of capitalized interest            (8,495)         (46,668)          (6,869)
   Interest and other income                                 1,586              413              412
                                                      ------------     ------------     ------------
       Total other income (expense)                         (6,909)         (46,255)          (6,457)
                                                      ------------     ------------     ------------
Loss Before Taxes and Extraordinary Item                  (121,662)        (392,128)         (59,140)

Income Tax Benefit                                              --           37,900               --
                                                      ------------     ------------     ------------
Loss Before Extraordinary Item                            (121,662)        (354,228)         (59,140)
                                                      ------------     ------------     ------------
Extraordinary Gain on Early Extinguishment of Debt         213,448               --               --
                                                      ------------     ------------     ------------
Net Income (Loss)                                     $     91,786     $   (354,228)    $    (59,140)
                                                      ============     ============     ============

Per Share Data:
   Loss Before Extraordinary Item                     $      (9.82)    $     (34.79)    $      (5.88)

   Extraordinary Gain on Early Extinguishment of
      Debt                                                   17.23               --               --
                                                      ------------     ------------     ------------
   Basic Net Income (Loss)                            $       7.41     $     (34.79)    $      (5.88)
                                                      ============     ============     ============

   Weighted Average Shares Outstanding                  12,386,200       10,180,505       10,055,140
                                                      ============     ============     ============
</Table>

See Notes to Consolidated




                                       36
<PAGE>

                      JCC HOLDING COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
                                 (IN THOUSANDS)

<Table>
<Caption>

                                                                                             FOR THE YEARS ENDED DECEMBER 31,
                                                                                          -------------------------------------
                                                                                            2001             2000        1999
                                                                                          ---------      ---------    ---------
<S>                                                                                       <C>            <C>          <C>
Cash Flows From Operating Activities:
  Net income (loss)                                                                       $  91,786      $(354,228)   $ (59,140)
  Adjustments to reconcile net income (loss) to net cash
      provided by (used in) operating activities:
      Depreciation and amortization                                                          11,812         26,339        5,107
      Amortization of note discount                                                          92,008          5,369          765
      Extraordinary gain on early extinguishment of debt                                   (213,448)            --           --
      Deferred rent                                                                             322          1,624          226
      Provision for bad debts                                                                 2,426          1,770           --
      Write-off of preconfirmation contingencies                                             (1,824)            --       (1,562)
      Provision for asset impairment                                                             --        258,812           --
      Deferred income taxes                                                                      --        (37,900)          --
      Amortization of unearned compensation                                                      --             --          259
      (Gain) loss on sale of property and equipment                                          (1,167)            --           27
      Changes in operating assets and liabilities:
         Accounts receivable                                                                    431         (4,865)      (3,134)
         Inventories                                                                             46           (331)        (354)
         Prepaids and other assets                                                            1,516           (918)      (1,062)
         Accounts payable - trade                                                             1,352         (1,168)       1,369
         Accrued interest                                                                        --         19,523       (5,855)
         Accrued expenses                                                                     4,930         (7,652)      16,336
         Preconfirmation contingencies                                                         (256)          (821)      (2,084)
         Due to Affiliates                                                                   16,591         34,090        8,224
         Other current liabilities                                                               58            (31)       2,009
         Payment of liabilities subject to compromise due to reorganization activities:
            Reorganization costs, excluding amortization of note discount of $90,314         10,715             --           --
            Payment of reorganization costs                                                  (9,947)            --           --
                                                                                          ---------      ---------    ---------
         Net cash flows provided by (used in) operating activities                            7,351        (60,387)     (38,869)
                                                                                          ---------      ---------    ---------

Cash Flows From Investing Activities:
  Capital expenditures                                                                       (2,671)        (3,408)    (130,552)
  Proceeds from sale of property                                                              5,998             --        6,042
  Increase in deferred charges and other assets                                              (1,347)        (1,218)      (8,492)
                                                                                          ---------      ---------    ---------
         Net cash flows provided by (used in) investing activities                            1,980         (4,626)    (133,002)
                                                                                          ---------      ---------    ---------
Cash Flows From Financing Activities:
  Net short-term borrowings                                                                      --          7,400       15,850
  Proceeds from notes payable - affiliate                                                     5,745         49,552        1,204
  Proceeds from issuance of long-term debt                                                       --             --      163,998
                                                                                          ---------      ---------    ---------
        Net cash flows provided by financing activities                                       5,745         56,952      181,052
                                                                                          ---------      ---------    ---------
Net increase (decrease) in cash and cash equivalents                                         15,076         (8,061)       9,181

Cash and cash equivalents, beginning of period                                               26,626         34,687       25,506
                                                                                          ---------      ---------    ---------
Cash and cash equivalents, end of period                                                  $  41,702      $  26,626    $  34,687
                                                                                          =========      =========    =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
  Cash paid during the period for:
      Interest                                                                            $   3,417      $  15,519    $  10,473
Noncash investing and financing activities:
      Increase in long-term debt for payment-in-kind interest payments                    $   3,083      $  14,578    $  14,013
      Capitalized interest                                                                $      --      $     140    $  18,924
      Issuance of restricted stock awards                                                 $      --      $     199    $     527
      Amortization of note discount                                                       $      --      $      --    $   2,771
</Table>

See Notes to Consolidated Financial Statements.



                                       37
<PAGE>


                      JCC HOLDING COMPANY AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
                                 (IN THOUSANDS)

<Table>
<Caption>

                                                                      COMMON STOCK
                                          ------------------------------------------------------------------------
                                                   NEW                   CLASS A                   CLASS B           ADDITIONAL
                                          ---------------------   ----------------------    ----------------------     PAID-IN
                                           SHARES      AMOUNT      SHARES       AMOUNT       SHARES       AMOUNT       CAPITAL
                                          ---------   ---------   ---------    ---------    ---------    ---------   ----------
<S>                                       <C>         <C>         <C>          <C>          <C>          <C>          <C>
Balance -- January 1, 1999                       --   $      --       5,547    $      55        4,453    $      45    $ 107,987
Restricted stock activity                        --          --          92            1           --           --          526
Other                                            --          --          (1)          --           --           --           25
Net loss                                         --          --          --           --           --           --           --
                                          ---------   ---------   ---------    ---------    ---------    ---------    ---------
Balance -- December 31, 1999                     --          --       5,638           56        4,453           45      108,538
                                          ---------   ---------   ---------    ---------    ---------    ---------    ---------
Restricted stock activity                        --          --         140            2           --           --         (269)
Net loss                                         --          --          --           --           --           --           --
                                          ---------   ---------   ---------    ---------    ---------    ---------    ---------
Balance -- December 31, 2000                     --          --       5,778           58        4,453           45      108,269
                                          ---------   ---------   ---------    ---------    ---------    ---------    ---------
Forgiveness of affiliate debt in
   exchange for new common stock and
   Senior Secured Notes due 2008 and
   cancellation of class B common stock       6,069          61          --           --       (4,453)         (45)     260,380
Forgiveness of non-affiliate debt in
   exchange for new common stock and
   Senior Secured Notes due 2008 and
   cancellation of class A common stock       6,317          63      (5,778)         (58)          --           --       44,501
Net income                                       --          --          --           --           --           --           --
                                          ---------   ---------   ---------    ---------    ---------    ---------    ---------
Balance -- December 31, 2001                 12,386   $     124          --    $      --           --    $      --    $ 413,150
                                          =========   =========   =========    =========    =========    =========    =========

<Caption>


                                             ACCUMULATED        UNEARNED
                                              DEFICIT         COMPENSATION          TOTAL
                                            ------------      ------------      ------------
<S>                                         <C>               <C>               <C>
Balance -- January 1, 1999                  $     (3,677)     $         --      $    104,410
Restricted stock activity                             --              (268)              259
Other                                                 --                --                25
Net loss                                         (59,140)               --           (59,140)
                                            ------------      ------------      ------------
Balance -- December 31, 1999                     (62,817)             (268)           45,554
                                            ------------      ------------      ------------
Restricted stock activity                             --               268                 1
Net loss                                        (354,228)               --          (354,228)
                                            ------------      ------------      ------------
Balance -- December 31, 2000                    (417,045)               --          (308,673)
                                            ------------      ------------      ------------
Forgiveness of affiliate debt in
   exchange for new common stock and
   Senior Secured Notes due 2008 and
   cancellation of class B common stock               --                --           260,396
Forgiveness of non-affiliate debt in
   exchange for new common stock and
   Senior Secured Notes due 2008 and
   cancellation of class A common stock               --                --            44,506
Net income                                        91,786                --            91,786
                                            ------------      ------------      ------------
Balance -- December 31, 2001                $   (325,259)     $         --      $    (88,015)
                                            ============      ============      ============
</Table>


                                       38
<PAGE>





                      JCC HOLDING COMPANY AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999


NOTE 1. ORGANIZATION, BASIS OF PRESENTATION AND BANKRUPTCY IN JANUARY 2001

Organization. JCC Holding Company ("JCC Holding") was incorporated under
Delaware law on August 20, 1996 in contemplation of succeeding to all of the
assets and liabilities of Harrah's Jazz Company, a general partnership, which
filed for relief under the United States Bankruptcy Code on November 22, 1995.
JCC Holding conducts business through its wholly-owned subsidiaries, Jazz Casino
Company, L.L.C., a Louisiana limited liability company ("Jazz Casino"), JCC
Development Company, L.L.C., a Louisiana limited liability company ("JCC
Development"), JCC Canal Development, L.L.C., a Louisiana limited liability
company ("Canal Development") and JCC Fulton Development, L.L.C., a Louisiana
limited liability company ("Fulton Development" and, together with JCC Holding,
Jazz Casino, JCC Development and Canal Development, the "Company"). Except as
otherwise noted for purposes of this report, references to the words "we", "us"
and "our" refer to JCC Holding Company together with each of its subsidiaries.

On October 30, 1998, in accordance with the Harrah's Jazz Company Joint Plan of
Reorganization confirmed by the United States Bankruptcy Court, we became the
successor to the operations of Harrah's Jazz Company. In connection with the
Harrah's Jazz Company plan of reorganization, JCC Holding issued an aggregate of
10 million shares of its capital stock consisting of both class A and class B
common stock. The former bondholders of Harrah's Jazz Company received class A
common stock, which constituted approximately 52% of the issued and outstanding
class A and class B common stock. In addition, the former bondholders also
received their pro rata share of (i) $187.5 million in aggregate principal
amount of Jazz Casino's senior subordinated notes with contingent payments, and
(ii) Jazz Casino's senior subordinated contingent notes (see Note 6). Harrah's
Entertainment, Inc. ("Harrah's Entertainment" or "HET") acquired beneficial
ownership of class B common stock which constituted approximately 43% of the
issued and outstanding class A and class B common stock. In accordance with the
American Institute of Certified Public Accountants' Statement of Position No.
90-7, "Financial Reporting by Entities in Reorganization Under the Bankruptcy
Code" ("SOP 90-7"), we adopted "fresh start reporting" on October 30, 1998
because owners immediately before filing and confirmation of the Harrah's Jazz
Company plan of reorganization received less then 50% of the voting shares of
the emerging entity.

Our purpose is to develop and operate an exclusive land-based casino
entertainment facility (the "Casino") in New Orleans, Louisiana. The Casino
commenced operations on October 28, 1999.

Bankruptcy in January 2001. On January 4, 2001, we filed a voluntary petition
for relief under Chapter 11 of the U.S. Bankruptcy Code in order to allow
restructuring of our obligations to the State of Louisiana and the City of New
Orleans, long-term debt, bank credit facilities, and trade and other
obligations. The filing was made in the U.S. Bankruptcy Court for the Eastern
District of Louisiana in New Orleans. After the filing of the petition, we
continued to operate as debtors-in-possession subject to the Bankruptcy Court's
supervision and orders until our Plan of Reorganization was consummated.

Our Plan of Reorganization, which was approved by the Bankruptcy Court on March
19, 2001 and was consummated on March 29, 2001 (the "Effective Date"), resulted
in, among other things, elimination of our then existing common stock and debt
securities and the issuance of new common stock and debt securities to certain
creditors. The accounting consequences of our bankruptcy proceeding are
reflected in the financial statements as of the Effective Date of our
reorganization. From January 1, 2001 through March 29, 2001, the Consolidated
Statements of Operations includes only five days of interest expense on our old
long-term debt and other obligations, except for debtor-in-possession loans made
during the bankruptcy proceedings upon which interest accrued through March 29,
2001, the Effective Date of our reorganization. The interest charges incurred
contractually from January 4, 2001 through March 29, 2001, but not recorded as a
result of our bankruptcy proceeding, totaled $15.6 million. The cancellation of
non-affiliate debt and related accrued interest resulted in an extraordinary
gain as of the Effective Date. During 2001, we recorded an extraordinary gain on
the early



                                       39
<PAGE>

extinguishment of our debt of $213.4 million. This gain arises from the
discharge of $317.0 million of outstanding principal and interest due to
non-affiliates under our senior subordinated notes with contingent payments due
2009, bank term loans, and convertible junior subordinated debentures, in
exchange for new debt and equity securities with a fair value of $103.6 million.
In addition, the cancellation of non-affiliate and affiliate debt and other
obligations resulted in an increase of $304.8 million to additional paid in
capital as of the Effective Date of our reorganization. We did not meet the
requirements to utilize fresh start reporting, since our holders of existing
voting shares immediately before confirmation received more than 50 percent of
voting shares of the emerging entity. Therefore, in accordance with SOP 90-7 our
liabilities compromised by the confirmed Plan of Reorganization have been stated
at the present value of the amounts to be paid, reorganization expenses have
been separately disclosed and the forgiveness of affiliate and non-affiliate
debt has been reported as an adjustment to additional paid in capital and an
extraordinary item, respectively, in the Consolidated Financial Statements.

         The key components of our Plan of Reorganization were:

             o    The reduction of our annual minimum payment obligations to the
                  Louisiana Gaming Control Board to the greater of 21.5% of
                  gross gaming revenue or a minimum payment of $50 million
                  commencing April 1, 2001, through March 31, 2002, and $60
                  million each casino operating contract fiscal year thereafter.
                  Harrah's Entertainment and Harrah's Operating Company, Inc., a
                  wholly-owned subsidiary of Harrah's Entertainment, ("Harrah's
                  Operating Company" or "HOCI") have provided a new minimum
                  payment guaranty to the Louisiana Gaming Control Board, which
                  secures Jazz Casino's annual minimum payment obligation to the
                  Louisiana Gaming Control Board for an initial four year period
                  through March 31, 2005 pursuant to a new agreement among
                  Harrah's Entertainment and Harrah's Operating Company and our
                  subsidiary Jazz Casino (the "new HET/JCC Agreement") (see
                  Notes 8 and 10).

             o    Our Plan of Reorganization also took into account a reduction
                  of at least $5 million in payments, taxes, administrative and
                  operational costs and/or other expenses that were paid or
                  incurred at least annually under the ground lease with the
                  City of New Orleans and the Rivergate Development Corporation
                  or as a result of obligations imposed or created by the ground
                  lease, whether to the City, the Rivergate Development
                  Corporation or others (see Note 9).

             o    Cancellation of all existing class A and class B common stock.

             o    Issuance of 12,386,200 shares of new common stock to various
                  creditors as described below.

             o    In consideration of, among other things, 1) Harrah's
                  Entertainment's and Harrah's Operating Company's consent to
                  the cancellation and extinguishment of all claims against us
                  arising under our Revolving Credit Facility, the Tranche A-2
                  Term Loan, the Tranche B-2 Term Loan, the Slot Lease, the
                  Junior Subordinated Credit Facility, the Completion Loan
                  Guarantee, and the JCC Development promissory note; 2)
                  Harrah's New Orleans Management Company, Inc.'s, and its
                  affiliates' agreement to waive all claims relating to existing
                  defaults under our Management Agreement, the Administrative
                  Services Agreement, the Forbearance Agreement, and any other
                  pre-petition claims against us; 3) Harrah's Crescent City
                  Investment Company's consent to waive the Warrant Agreement;
                  and 4) Harrah's Operating Company's agreement to contribute
                  the slot machines used in our Casino to us, Harrah's
                  Entertainment received 6,069,238 shares (49%) of our new
                  common stock.

             o    Holders of claims arising under Tranche B-1 of the Bank Credit
                  Facilities received 1,734,068 shares (14%) of our new common
                  stock.

             o    Holders of claims arising under our senior subordinated notes
                  received 4,582,894 shares (37%) of our new common stock.

             o    We issued new term notes, the Senior Notes due 2008, in the
                  aggregate amount of $124.5 million (face value), which will
                  mature seven years from their issuance and bear interest at
                  The London




                                       40
<PAGE>

                  Interbank Offered Rate ("LIBOR") plus 275 basis points. The
                  holders of claims arising under Tranches A-1, A-3 and B-1 of
                  the Bank Credit Facilities received $55.0 million in Senior
                  Notes; Harrah's Entertainment and its affiliates, as holders
                  of claims arising under the HET/JCC Agreement and Tranche A-2
                  of the Bank Credit Facilities received $51.6 million in Senior
                  Notes; and holders of claims arising under the senior
                  subordinated notes received $17.9 million in Senior Notes.

             o    All holders of Casino operation related unsecured claims were
                  paid, in cash, the full amount of their claims.

Upon the filing of our petitions for Chapter 11 reorganization, we required
funds to meet certain post-petition financial obligations, including the minimum
daily payments required under our casino operating contract and the payment
obligations arising under our ground lease with Rivergate Development
Corporation and the City of New Orleans. To meet those cash needs, we arranged
for a debtor-in-possession financing facility provided by Harrah's Entertainment
and its affiliates, the terms of which were negotiated with Harrah's
Entertainment prior to the date of filing our bankruptcy petition. Under this
facility, the interest rate was Prime plus 3% (11% as of March 29, 2001). In
2001, we borrowed $6.3 million under this facility, of which $2.1 million was
repaid in cash and the remaining balance of principal and related accrued
interest was eliminated in accordance with the Plan of Reorganization.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation. The consolidated financial statements include the
accounts of JCC Holding Company and its subsidiaries. All significant
inter-company accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents. For purposes of the consolidated statements of cash
flows and consolidated balance sheets, cash and cash equivalents include highly
liquid investments with original maturities of three months or less. As of
December 31, 2001, restricted cash includes approximately $3.2 million of
contributions to the capital replacement fund (see Notes 9 and 10) and $43,000
of contributions to the Open Access Program public support efforts (see Note
10). As of December 31, 2000, restricted cash includes approximately $1.9
million of unused contributions to the capital replacement fund, $184,000 of
contributions to the Open Access Program public support efforts and $8,000 of
construction escrow funds.

Inventories. Inventories, which consist primarily of food, beverage, operating
supplies and retail items, are stated at average cost.

Property and Equipment. Property and equipment are stated at cost, except for
adjustments related to fresh start reporting in 1998 and adjustments related to
asset impairment in 2000 (see Note 3). Improvements and repairs that extend the
life of the asset are capitalized. Maintenance and repairs are expensed as
incurred. Interest is capitalized on constructed assets at the Company's overall
weighted average rate of interest. No interest was capitalized in 2001.
Capitalized interest amounted to $140,000 and $21.7 million in 2000 and 1999,
respectively.

Depreciation is calculated using the straight-line method over the shorter of
the estimated useful lives of the assets, the related lease term, or the life of
the amended casino operating contract as follows:

<Table>
<S>                                  <C>
Buildings on leased land             25 years
Leasehold improvements               9 years
Furniture, fixtures and equipment    3 to 7 years
</Table>

Property held for development is valued at the lower of cost or estimated fair
value. Costs incurred in developing these properties, not in excess of their
fair values, are capitalized. On October 15, 2001, we sold the Canal Place
property for approximately $6 million and recognized a $1.1 million gain
recorded in other income.

Deferred Operating Contract Cost. Deferred operating contract cost consists of
payments, net of adjustments related to asset impairment (see Note 3) and of
adjustments related to fresh start reporting in 1998, to the Louisiana Economic
Development and Gaming Corporation (see Note 10) required under the original
casino operating contract between Harrah's Jazz Company and the Louisiana
Economic Development and Gaming Corporation, which




                                       41
<PAGE>

commenced on July 15, 1994, and is being amortized on the straight-line basis
over the period from October 28, 1999 through July 24, 2024, the life of the
amended and renegotiated casino operating contract dated October 30, 1998 among
Harrah's Jazz Company, Jazz Casino and the State of Louisiana, by and through
the Louisiana Gaming Control Board. The amended and renegotiated casino
operating contract, which was entered into in connection with the Harrah's Jazz
Company plan of reorganization, modified the original casino operating contract
between Harrah's Jazz Company and the Louisiana Economic Development and Gaming
Corporation and is referred to herein as the amended casino operating contract.
This contract was subsequently amended as a result of our Plan of Reorganization
as discussed in Note 10.

Lease Prepayment. Lease prepayment includes a non-refundable initial payment,
net of adjustments related to fresh start reporting in 1998 and adjustments
related to asset impairment (See Note 3), required under the original ground
lease for the site on which the Casino has been constructed (see Note 9) and is
being amortized on a straight-line basis over 25 years, the life of the amended
casino operating contract.

Revenue Recognition and Promotional Allowances. Jazz Casino recognizes the net
win from gaming activities (the difference between gaming wins and losses) as
casino revenues. Casino revenues are net of accruals for anticipated payouts of
progressive slot machine jackpots and certain progressive table game payouts.
Such anticipated jackpots and payouts are reflected as other current liabilities
in the accompanying consolidated balance sheets. Food and beverage, parking,
retail, and other revenues are recognized as services are provided. The
estimated value of beverages, food, parking, retail and other items, which are
provided to customers without charge or in exchange for total reward points, has
been included in revenues and a corresponding amount has been deducted as a
promotional allowance. We reflect "cash back" rewards and cash sales incentives
as a reduction of revenues in promotional allowances. "Cash back" rewards and
cash sales incentives for the years ended December 31, 2001, 2000, and 1999 were
$18.6 million, $19.0 million and $899,000 respectively.

The estimated costs of providing such complimentary services are included in
Casino costs and expenses and for the years ended December 31, 2001, 2000, and
1999 are as follows:


<Table>
<Caption>

                    2001              2000             1999
                 ------------     ------------     ------------
                                (in thousands)

<S>              <C>              <C>              <C>
Beverage         $     10,335     $      5,700     $        893
Food                    4,607            1,900               --
Parking                 4,178            1,100              235
Retail Items              610              500               39
</Table>


Under the amended Gaming Act and its rules and regulations, subsequent to the
effective date of our Plan of Reorganization, we are still restricted from
freely offering complimentary or discounted food and lodging to the general
public except under limited circumstances. Under the terms of the amended casino
operating contract, in effect for the three months ended March 31, 2001 and
years ended December 31, 2000 and 1999, Jazz Casino was not allowed to give away
or subsidize food from the Casino's buffet and is prohibited from developing
on-site lodging. In order to compensate for these limitations and offer its
patrons the integrated Casino, dining and entertainment experience, the Casino
offers its patrons complimentary meals, hotel rooms, transportation,
entertainment, and other amenities at various local establishments. The expense
related to providing these external complimentary services are included in
casino costs and expenses and totaled $32.7 million in 2001, $20.8 million in
2000 and $4.5 million for the period from October 28, 1999 to December 31, 1999.

Preopening Costs. Preopening costs represent primarily the direct salaries and
other operating costs incurred by us prior to the opening of the Casino on
October 28, 1999. We account for start-up activities under provisions of the
AICPA SOP 98-5, "Reporting on the Costs of Start-Up Activities," which provides
guidance on the financial reporting of start-up costs and organization costs. It
requires costs of start-up activities and organization costs to be expensed as
incurred.

Preconfirmation Contingencies. Preconfirmation contingencies as of December 31,
2001, represent estimated amounts owed to creditors of Jazz Casino under its
Plan of Reorganization. Preconfirmation contingencies as of




                                       42
<PAGE>

December 31, 2000 represent amounts owed to creditors of the predecessor
company, Harrah's Jazz Company, which were transferred to the Company under the
Harrah's Jazz Company Plan of Reorganization. During 2001 and 1999,
preconfirmation contingencies were reduced by $1.8 million and $1.6 million,
respectively, due to changes in estimates. This amount is included as a
reorganization item in the Consolidated Statements of Operations.

Amortization of Note Discount. The discount associated with Jazz Casino's Senior
Notes and senior subordinated notes with contingent payments (see Note 6) are
amortized using the interest method. Our interest expense for 2001, 2000 and
1999 includes amortization of the note discount of $1.7 million, $5.4 million
and $3.5 million, respectively.

Income Taxes. We account for income taxes under the provisions of Statement of
Financial Accounting Standard ("SFAS") No. 109, "Accounting for Income Taxes."
Under SFAS No. 109, deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax bases of assets and
liabilities, using enacted tax rates in effect for the year in which the
differences are expected to reverse.

Net Income (Loss) Per Share. We account for net income (loss) per share under
the provisions of SFAS No. 128, "Earnings Per Share." This standard requires
dual presentation of net income per common share and net income per share
assuming dilution on the face of the statement of operations. Basic net income
per common share is computed by dividing the net income attributable to common
stockholders by the weighted average number of shares outstanding during the
period. Diluted earnings per common share assume that any dilutive convertible
debentures outstanding at the beginning of each year were converted at those
dates, with related interest and outstanding common shares adjusted accordingly.
Jazz Casino's convertible junior subordinated debentures (see Note 6) were not
included in the computation of diluted earnings per common share for 2000 and
1999 because it would have resulted in an antidilutive effect. Diluted earnings
per common share also assumes that outstanding common shares were increased by
shares issuable upon exercise of those stock warrants and stock options for
which market price exceeds exercise price, less shares which could have been
purchased by us with related proceeds. Since the exercise price associated with
the warrant issued to Harrah's Crescent City Investment Company (see Note 12) is
above the market price of the class A common stock, it was not dilutive in 2000
and 1999. In 2001, the net income (loss) per share was not dilutive.

Stock-Based Compensation. In 1999, we adopted the disclosure-only provisions of
SFAS No. 123 "Accounting for Stock-Based Compensation." SFAS No. 123 encourages,
but does not require, companies to adopt a fair value based method for
determining expense related to stock-based compensation. The disclosures are
presented in Note 11. We continue to account for stock-based compensation using
the intrinsic value method as prescribed under Accounting Principles Board
Opinion ("APB") No. 25, "Accounting for Stock Issued to Employees," and related
interpretations.

Use of Estimates. Financial statements prepared in accordance with accounting
principles generally accepted in the United States of America require management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.

Long-Lived Assets. We periodically evaluate whether events and circumstances
have occurred that indicate that certain assets may not be recoverable. When
factors indicate that long-lived assets should be evaluated for impairment, we
use an estimate of undiscounted net cash flow over the shorter of the remaining
life of the related lease, contract, or asset, as applicable, in determining
whether the assets are recoverable. See Note 3 for a discussion of asset
impairment adjustments recorded during the fourth quarter of 2000 as a result of
our asset impairment evaluation.

Fair Value of Financial Instruments. SFAS No. 107, "Disclosure About Fair Value
of Financial Instruments", requires certain disclosures regarding the fair value
of financial instruments. Current assets and current liabilities, including due
to affiliates, are reflected in the consolidated financial statements at fair
value because of the short-term maturity of these instruments, except for
certain balances as of December 31, 2000 including short-term borrowings, due to
affiliates and accrued interest which had a fair value of $17.6 million, $50.0
million and $2.3 million, respectively, based on the Plan of Reorganization. The
fair value of long-term other assets and liabilities,



                                       43
<PAGE>

excluding debt and due to affiliates, closely approximates their carrying value
(see Note 6). We use quoted market prices, when available, or discounted cash
flows to calculate these fair values.

Segment Information. Our principal line of business is casino and entertainment
development.

Recently Issued Accounting Pronouncements. In the first quarter of 2001, the
Emerging Issues Task Force ("EITF") reached a consensus on certain issues in
EITF 00-22 "Accounting for "Points" and Certain Other Time-Based and
Volume-Based Sales Incentive Offers, and Offers for Free Products or Services to
Be Delivered in the Future." EITF 00-22 requires that cash rebates or refunds be
shown as a reduction of revenues effective for quarters ending after February
15, 2001. In 2001, the EITF also reached a consensus on certain issues in EITF
00-14 "Accounting for Certain Sales Incentives." EITF 00-14 requires that the
reduction in or refund of the selling price of the product or service resulting
from any cash sales incentive should be classified as a reduction in revenues
effective no later than in annual or interim financial statements for the
periods beginning after December 15, 2001. We adopted the consensus provisions
of EITF 00-22 and EITF 00-14 in the first quarter 2001 and the fourth quarter
2001, respectively. To be consistent with the 2001 presentation, various "cash
back" rewards and cash sales incentives, previously shown as casino expenses,
were reclassified as a reduction in revenues in 2000 and 1999. This did not have
any effect on previously reported operating income (loss) or net income (loss).
The cash back rewards and cash sales incentives for 2001, 2000, and 1999 were
$18.6 million, $19.0 million, and $899,000, respectively.

The Financial Accounting Standards Board has issued Statement of Financial
Accounting Standards ("SFAS") No. 141 "Business Combinations" and No. 142
"Goodwill and Other Intangible Assets." Both statements were issued in June
2001. SFAS No. 141 requires that the purchase method of accounting be used for
all business combinations initiated after June 30, 2001 and that the use of the
pooling-of-interests method is no longer allowed. SFAS No. 142 requires that
upon adoption, amortization of goodwill will cease and instead, the carrying
value of goodwill will be evaluated for impairment on an annual basis.
Identifiable intangible assets will continue to be amortized over their useful
lives and reviewed for impairment in accordance with SFAS No. 121 "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of." SFAS No. 142 is effective for fiscal years beginning after December 15,
2001. Management does not believe these Standards will have a significant impact
on our financial position and results of operations.

SFAS No. 143, "Accounting for Asset Retirement Obligations", was issued during
June 2001. SFAS No. 143 establishes accounting standards for the recognition and
measurement of an asset retirement obligation and its associated asset
retirement cost. It also provides accounting guidance for legal obligations
associated with the retirement of tangible long-lived assets. SFAS No. 143 is
effective in fiscal years beginning after June 15, 2002, with early adoption
permitted. Management does not believe this Standard will have a significant
impact on our financial position and results of operations.

SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets"
was issued during August 2001. SFAS No. 144 establishes a single accounting
model for the impairment or disposal of long-lived assets, including
discontinued operations. SFAS No. 144 superseded SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of"
and APB Opinion No. 30, "Reporting the Results of Operations - Reporting the
Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions." The provisions of SFAS No. 144
are effective in fiscal years beginning after December 15, 2001, with early
adoption permitted, and in general are to be applied prospectively. Management
does not believe this Standard will have a significant impact on our financial
position and results of operations.

Reclassifications. Certain reclassifications have been made in prior year's
financial statements to conform to classifications used in the current year.

NOTE 3. ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS

We account for impairment of long-lived assets in accordance with SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of." On December 27, 2000, we received notice from Harrah's
Entertainment, Inc. and Harrah's Operating Company that they would not provide
the minimum payment guaranty required under the terms of our casino operating
contract. Accordingly, management reviewed its




                                       44
<PAGE>

long-lived assets and identifiable intangibles and determined an impairment had
occurred. The estimated fair value of the assets was determined by management
using judgment and a reorganization value determined in consultation with an
independent firm. During the fourth quarter of 2000, we recorded an impairment
charge and wrote down approximately $255.9 million of impaired long-lived
assets. The write down included $177.4 million of buildings on leased land,
$19.2 million of furniture, fixtures and equipment, $293,000 of leasehold
improvements, $138,000 of construction in progress, $39.9 million of deferred
operating contract costs, $9.9 million of lease prepayments and $9.1 million of
deferred charges and other long lived assets. Generally, fair value represents
our expected future cash flows from the use of the long-term assets, discounted
at a rate commensurate with the risks involved. Considerable management judgment
is necessary to estimate the fair value of our long-lived assets. Accordingly,
actual results may vary from management's estimates. In addition, for the year
ended December 31, 2000, we recorded asset impairment adjustments of $2.9
million to write down furniture, fixtures and equipment to be disposed of to
their net realizable value. There were no impairment charges for the year ended
December 31, 2001.

NOTE 4. ACCRUED EXPENSES

Accrued expenses as of December 31 consist of the following:

<Table>
<Caption>

                                               2001        2000
                                             -------     -------
                                               (In thousands)
<S>                                          <C>         <C>
Payroll & related benefits                   $ 7,604     $ 7,348
State gaming minimum payment                   2,646       1,096
Orleans Parish School Board contribution       2,025       2,000
Professional fees                              1,000         483
Marketing and advertising expenses               889         326
Accrued taxes, excluding income taxes            876         294
Hotel rooms & catering                           572         412
Other                                          1,619         342
                                             -------     -------
     Total                                   $17,231     $12,301
                                             =======     =======
</Table>

NOTE 5. SHORT-TERM BORROWINGS

We have $35 million available for working capital purposes under a new revolving
line of credit provided by Harrah's Entertainment with a letter of credit
sublimit of $10 million. Our new revolving line of credit bears interest at a
rate of LIBOR plus 3.00% per annum and will mature in 2006 subject to extension
until March 30, 2007 at our option. The obligations under the new revolving line
of credit are secured by substantially all of our assets (except our casino
operating contract with the State of Louisiana and the revenue share payments
due to the State of Louisiana thereunder) and the Casino's bankroll. Our new
revolving line of credit is secured on a second lien priority basis, junior only
to a lien securing certain obligations under the new HET/JCC Agreement pursuant
to which Harrah's Entertainment agreed to provide a minimum payment guaranty. As
of December 31, 2001, Jazz Casino had no outstanding borrowings under this
revolving line of credit and had outstanding letters of credit of $700,000.

Pursuant to our cancelled credit agreement dated as of October 29, 1998 among
Jazz Casino, as borrower, JCC Holding, as guarantor, and a syndicate of lenders
led by Bankers Trust Company, Jazz Casino had obtained a $25 million revolving
line of credit, which would have terminated in January 2006. Letters of credit
could be drawn on the available balance under this credit facility up to $10
million. Under the revolving line of credit, the interest rate on the Eurodollar
loans ranged from LIBOR plus 2.50% to LIBOR plus 3.50% and the interest rate on
the base rate loans was prime plus 1.0% less than the applicable margin on the
Eurodollar loans. As of December 31, 2000, Jazz Casino had outstanding
borrowings of $23.3 million and outstanding letters of credit of $1.7 million
under this revolving line of credit. On the Effective Date, this revolving line
of credit was cancelled. The weighted average interest rates on our outstanding
short-term borrowings during the years ended December 31, 2001 and 2000 were
9.64% and 9.56%, respectively. Refer to Note 6 for a discussion of the former
guaranty related to the revolving line of credit.




                                       45
<PAGE>




NOTE 6. LONG-TERM DEBT AND OTHER FINANCING AGREEMENTS

         Long-term debt consisted of the following as of December 31:

<Table>
<Caption>

                                                                     2001          2000
                                                                 ------------  ------------
                                                                       (In thousands)
<S>                                                              <C>           <C>
Senior secured notes due 2008, ("Senior Notes")
     5.4% (b), LIBOR plus 2.75%(c)                               $    127,603  $         --
Unamortized note discount                                             (21,927)           --
                                                                 ------------  ------------
                                                                      105,676            --
                                                                 ------------  ------------
Term loans:
     Tranche A-1, 8.00% (a), (LIBOR plus 1%)(e)                            --        10,000
     Tranche A-2, 9.75% (a), (LIBOR plus 2.5% to 3.5%)(d)(e)               --        20,000
     Tranche A-3, 8.00% (a), (LIBOR plus 1%)(e)                            --        30,000
     Tranche B-1, 9.50% (a), (LIBOR plus 2.5%)(e)                          --        30,000
     Tranche B-2, 9.75% (a), (d)(e)                                        --       121,500
                                                                 ------------  ------------
                                                                           --       211,500
                                                                 ------------  ------------

Senior subordinated notes with contingent
     payments, 6.10% (a)                                                   --       211,305
Unamortized note discount                                                  --       (90,365)
                                                                 ------------  ------------
                                                                           --       120,940
                                                                 ------------  ------------

Senior subordinated contingent notes                                       --            --

Convertible junior subordinated debentures, 8.00%(a)                       --        32,025

Junior subordinated credit facility-affiliate, 8.00%(a)                    --        25,167

Completion Loan - affiliate, 8.00%(a)                                      --         5,127

Promissory note - affiliate, 9.00%(a)                                      --         1,653

                                                                 ------------  ------------
Total long-term debt                                             $    105,676  $    396,412
                                                                 ============  ============
</Table>


----------

(a)      Represents the interest rate for the respective debt agreement in
         effect as of December 31, 2000.

(b)      Represents the interest rate for the respective debt agreements in
         effect as of December 31, 2001.

(c)      The Senior Notes pay interest quarterly at LIBOR plus 2.75% annum.

(d)      The applicable interest rate on tranche B-2 on borrowings up to $10
         million was LIBOR plus Harrah's Entertainment's applicable margin then
         in effect, which represents Harrah's Entertainment's current interest
         rate on its credit facility. Borrowings in excess of $10 million
         accrued interest at LIBOR plus 2.5% to LIBOR plus 3.5%.

(e)      The interest rate on the term loans maintained as base rate loans was
         the sum of (i) the applicable base interest rate and (ii) that
         percentage (not below 1.0%) which was 1.0% less than the margin for
         loans of such Tranche maintained as Eurodollar loans.



                                       46
<PAGE>

Senior Notes

On the Effective Date, the existing long-term debt was cancelled. In connection
with the cancellation of this debt and certain other obligations, Senior Notes
were issued by Jazz Casino Company in the aggregate principal (face) amount of
$124.5 million that will mature seven years after the Effective Date (see Note 1
and 9). The Senior Notes pay interest quarterly at LIBOR plus 2.75% per annum.
In the first year, one half of the interest payments on the Senior Notes may be
paid in kind and added to the principal at our option. Principal payments on the
Senior Notes will be amortized as follows: zero in the first year; 50% of free
cash flow (as defined in the Senior Note agreement) in the second through fourth
years; and $6 million annually in the fifth through seventh years, with all
remaining unpaid principal payable at maturity. As of the effective date, we
considered the variable interest rate on the new term notes to be lower than
prevailing interest rates for debt with similar terms and credit ratings. In
accordance with Statement of Position 90-7, the new term notes were valued based
on discounting concepts to approximate their fair value (12.5% discount rate).
We are also subject to numerous debt covenants under the new term note
agreement, including restrictions on, among other things, certain payments,
transactions with affiliates, dividends, liens, incurrence of additional
indebtedness, asset sales, mergers and consolidations, payment of certain
indebtedness, capital expenditures, and investments or loans. JCC Holding
Company and all of its wholly owned subsidiaries have fully and unconditionally
guaranteed on a joint and several basis Jazz Casino's obligations under the
Senior Notes (see Note 13).

Pursuant to the terms of the indenture for our Senior Notes, revolving credit
agreement, and HET/JCC Agreement, we are restricted from paying dividends on the
Common Stock to our stockholders, or from setting aside funds for this purpose.
The payment of cash dividends, if any, will be made only from assets legally
available for that purpose (i.e. net profits or capital surplus), and will
depend on our financial condition, results of operations, current and
anticipated capital requirements, restrictions under then existing debt
instruments and other factors deemed relevant by the board of directors.

As of December 31, 2001, Jazz Casino Company had paid $ 3.1 million in interest
in kind and $ 3.4 million in cash interest on these Senior Notes.

Term Loans (Cancelled March 29, 2001)

Pursuant to the cancelled credit agreement dated as of October 29, 1998 among
Jazz Casino, as borrower, JCC Holding, as guarantor, and a syndicate of lenders
led by Bankers Trust Company, Jazz Casino had obtained and used a construction
financing loan of $211.5 million under various term loans and up to $25 million
of available working capital under a revolving line of credit (see Note 5). The
term loans and the revolving line of credit were a single combined credit
facility. As of December 31, 2000 and March 29, 2001, the outstanding balance of
the term loans amounted to $211.5 million.

The scheduled quarterly repayments on these old notes were deferred for the
first six semi-annual interest payment periods since interest on Jazz Casino's
senior subordinated notes with contingent payments (see below) was paid in kind
and the Harrah's New Orleans Management Company (the " Manager") had deferred
its fees under the terms of its management agreement with Jazz Casino (see Note
8) and under the agreement (the "HET/JCC Agreement") among Jazz Casino, Harrah's
Entertainment and Harrah's Operating Company, pursuant to which Harrah's
Entertainment and Harrah's Operating Company had provided an initial guaranty in
favor of the State of Louisiana by and through the Louisiana Gaming Control
Board of a $100 million annual payment due to the State of Louisiana under the
amended casino operating contract (see Note 10). Jazz Casino had included $13.4
million and $5.2 million of repayments due in 2001 and 2000 as long-term debt
due to its intent to defer these repayments, prior to the Effective Date.

The tranche A term loans generally ranked senior to all existing and future
indebtedness of Jazz Casino except certain obligations of Jazz Casino under the
HET/JCC Agreement (see Note 8).

The term loans and the revolving line of credit were secured by liens on
substantially all of the assets of each of Jazz Casino (excluding the amended
casino operating contract, funds deposited in the house bank maintained at the
Casino and the Gross Gaming Revenue Share Payments (as defined in Note 10)), JCC
Holding, JCC Development, Canal Development and Fulton Development.



                                       47
<PAGE>

The obligations of Jazz Casino under its credit agreement were guaranteed on a
senior basis by JCC Holding, JCC Development, Canal Development and Fulton
Development.

The tranche A-2 and B-2 term loans along with the revolving line of credit were
also guaranteed by Harrah's Entertainment and Harrah's Operating Company. As
consideration for this guaranty, Harrah's Entertainment received an annual
credit support fee from Bankers Trust Company and Jazz Casino equal to 2% and
approximately 0.75%, respectively, of the average aggregate principal amount of
loans and/or stated amount of letters of credit outstanding under tranche A-2
and B-2 term loans and the revolving line of credit (in the case of tranche B-2
term loans only to the extent of the aggregate principal amount thereof from
time to time in excess of $10 million). During the year ended December 31, 2000
and 1999, Jazz Casino incurred annual credit support fees of approximately $1.1
million and $388,000, which were deferred under the terms of the HET/JCC
Agreement.

In conjunction with an amendment to our credit agreement, on September 1, 2000,
Harrah's Operating Company purchased from our bank lenders approximately $145.5
million of our obligations outstanding at that time to the bank lenders, which
amount it had previously guaranteed under the guaranty and loan purchase
agreement. Harrah's Operating Company, agreed to provide the funding for the
balance of our $25 million revolving line of credit as it was drawn from the
banks.

On the Effective Date, this credit facility was cancelled and Senior Notes and
new Common Stock were issued in the amount of $55.0 million (face value) and 1.7
million shares, respectively, to the syndicate of lenders and Senior Notes of
$21.0 (face value) and 2.5 million shares of common stock to Harrah's
Entertainment and its affiliates (see Note 1).

Senior Subordinated Notes and Contingent Notes (Cancelled March 29, 2001)

In connection with the Harrah's Jazz Company plan of reorganization, in 1998
Jazz Casino issued (1) $187.5 million aggregate principal amount of senior
subordinated notes with contingent payments maturing in 2009, and (2) senior
subordinated contingent notes maturing in 2009 pursuant to indentures, dated as
of October 30, 1998, by and among Jazz Casino, as obligor, JCC Holding, JCC
Development, Canal Development and Fulton Development, as guarantors, and
Norwest Bank Minnesota, National Association, as Trustee. As of December 31,
2000 and March 31, 2001, the outstanding balance amounted to $211.3 million.

The fixed interest rate on the senior subordinated notes with contingent
payments was 5.867% per year, increasing over the first three years to a rate of
6.214% in the fourth and fifth years and increasing to 8% after the first five
years and was payable semiannually in arrears on each May 15 and November 15,
beginning May 15, 1999. Jazz Casino had the option to pay the first six
semi-annual payments of fixed interest on its senior subordinated notes with
contingent payments in kind rather than in cash; provided, however, that Jazz
Casino must pay the first four semi-annual payments of fixed interest in kind if
tranche A-1 and/or tranche A-2 term loans were outstanding when such payments
were due. Jazz Casino had the option to pay the fifth and sixth semi-annual
payments of fixed interest in kind and was required to do so by its credit
agreement under certain circumstances. Jazz Casino paid the first four interest
payments amounting to $23.8 million on its senior subordinated notes with
contingent payments in kind rather than in cash.

As of December 31, 2000, there were no amounts outstanding under the senior
subordinated contingent notes or the contingent payments under the senior
subordinated notes.

The senior subordinated notes with contingent payments and the senior
subordinated contingent notes were secured on an equal and ratable basis by
liens on substantially all of the assets of Jazz Casino, JCC Holding, JCC
Development, Canal Development and Fulton Development (excluding the amended
casino operating contract, funds deposited in the house bank maintained at the
Casino and the Gross Gaming Revenue Share Payments (as defined in Note 10)).

On the Effective Date, the senior subordinated notes with contingent payments
and the senior subordinated contingent notes were cancelled. The senior
subordinated noteholders received Senior Notes and new Common Stock in the
amount of $17.9 million (face value) and 4.6 million shares, respectively. The
senior subordinated contingent noteholders did not receive any Senior Notes or
new Common Stock for the cancellation of this debt (see Note 1).



                                       48
<PAGE>

Convertible Junior Subordinated Debentures (Cancelled March 29, 2001)

On October 30, 1998, Jazz Casino issued to Bankers Trust Company, Donaldson,
Lufkin & Jenrette Securities Corporation, Salomon Smith Barney Inc., BT Alex.
Brown Incorporated and Bank One, $27,287,500 aggregate principal amount of its
convertible junior subordinated debentures due 2010. The convertible junior
subordinated debentures were scheduled to mature in May 2010. The convertible
junior subordinated debentures bore interest at the rate of 8% per year, payable
semi-annually in cash; provided, however, that Jazz Casino had the option of
paying the interest on the debentures, in whole or in part, in kind rather than
in cash (1) at any time on or prior to October 30, 2003, and (2) at any time
thereafter if Jazz Casino did not make contingent payments with respect to the
senior subordinated contingent notes on the immediately preceding interest
payment date for the senior subordinated contingent notes. Jazz Casino had paid
the first four interest payments amounting to $4.7 million in kind. The
convertible junior subordinated debentures were unsecured obligations of Jazz
Casino. The convertible junior subordinated debentures were convertible at the
option of the holders, in whole or in part, at any time after October 1, 2002,
into class A common stock or, after the Transition Date (as defined in the
agreement), unclassified common stock of JCC Holding at a conversion price of
$25.00 per share, subject to dilution and other appropriate adjustments.
As of December 31, 2000 and March 29, 2001, the outstanding balance amounted to
$32.0 million.

On the Effective Date, the convertible junior subordinated debentures were
cancelled. The holders of the convertible junior subordinated debentures did not
receive any Senior Notes or new Common Stock for the cancellation of this debt
(see Note 1).

Junior Subordinated Credit Facility (Cancelled March 29, 2001)

On October 30, 1998, Jazz Casino entered into a junior subordinated credit
facility with Harrah's Entertainment and Harrah's Operating Company whereby
Harrah's Operating Company agreed to make available to Jazz Casino up to $22.5
million of subordinated indebtedness to fund project costs to the extent that
such costs exceeded amounts available under the term loans (excluding the
tranche A-2 and tranche B-2 term loans), the proceeds from the issuance of the
convertible junior subordinated debentures and the $15 million equity investment
by Harrah's Crescent City Investment Company in JCC Holding on October 30, 1998.
As of March 29, 2001, Jazz Casino had drawn $22.5 million under this facility.

The junior subordinated credit facility was unsecured. Amounts owed under the
junior subordinated credit facility were due and payable six months following
the maturity of the senior subordinated notes with contingent payments.
Outstanding principal under the junior subordinated credit facility bore
interest at the rate of 8% per year. Interest would be paid in cash and would be
added to the outstanding principal amount if certain earnings before interest,
income taxes, depreciation, and amortization ("EBITDA") tests were not met for
the contingent payment periods or if Jazz Casino paid interest in kind on its
senior subordinated notes with contingent payments after September 30, 2000.
Jazz Casino paid the first interest payment due on September 30, 2000 amounting
to $2.7 million under this facility in kind. As of December 31, 2000 and March
29, 2001, the outstanding balance amounted to $25.2 million.

On the Effective Date the junior subordinated credit facility was cancelled. The
holders of the junior subordinated credit facility did not receive any Senior
Notes or new Common Stock for the cancellation of this debt (see Note 1).

Completion Loan Agreement (Cancelled March 29, 2001)

On October 30, 1998, Jazz Casino entered into an amended and restated
subordinated completion loan agreement with Harrah's Entertainment and Harrah's
Operating Company under which any expenditure made by Harrah's Entertainment and
Harrah's Operating Company under its completion guarantees, which were not also
expenditures under our amended and restated construction lien indemnity
agreement with Harrah's Operating Company, were deemed unsecured loans. The
loans under the completion loan agreement bore interest at a rate of 8% per
annum and were scheduled to mature on April 30, 2010. No fees were payable to
Harrah's Entertainment and Harrah's Operating Company in connection with the
completion guarantees. As of December 31, 2000 and March 29, 2001, the
outstanding balance under the completion loan was $5.1 million.



                                       49
<PAGE>

On the Effective Date, the completion loan agreement was cancelled. The holders
of the completion loan agreement did not receive any Senior Notes or new Common
Stock for the cancellation of this debt (see Note 1).

Promissory Note (Cancelled March 29, 2001)

On October 26, 1999, JCC Development entered into a promissory note with
Harrah's Operating Company that provided for borrowings up to $2 million.
Borrowings under this loan accrued interest at 9% per year, and, at JCC
Development's option, could be paid in cash or in kind. The entire unpaid
balance of principal and interest was scheduled to be due on October 26, 2004.
As of December 31, 2000 and March 29, 2001, JCC Development had outstanding
borrowings under this note of $1.7 million, and had incurred interest costs of
$140,000, which was capitalized in connection with its development activities.

On the Effective Date, the promissory note was cancelled. The holder of this
promissory note did not receive any Senior Notes or new Common Stock for the
cancellation of this debt (see Note 1).

As of December 31, 2001, maturities of long-term debt (by their original terms)
are as follows:

<Table>
<Caption>

                                 (In thousands)

<S>                               <C>
2002                              $        --

2003                                       --

2004                                       --

2005                                    4,500

2006                                    6,000

Thereafter                            117,103

Unamortized Discount                  (21,927)
                                  -----------

Total Long-Term Debt              $   105,676
                                  ===========
</Table>

Fair Value

The estimated fair values and carrying amounts of long-term debt and due to
affiliates are as follows (in thousands):


<Table>
<Caption>

                                            2001                           2000
                                -----------------------------   -----------------------------
                                 FAIR VALUE    CARRYING VALUE    FAIR VALUE    CARRYING VALUE
                                ------------   --------------   ------------   --------------
<S>                             <C>            <C>              <C>            <C>
Senior notes due 2008           $     95,702    $    105,676              --              --
Senior subordinated notes
     with contingent                      --              --    $     46,182    $    120,940
     payments
Term loans                                --              --          72,238         211,500
Convertible junior
     subordinated debentures              --              --              --          32,025
Junior subordinated credit                --              --              --          25,167
     facility - affiliate
Completion loan - affiliate               --              --              --           5,127
Promissory note - affiliate               --              --              --           1,653
Long-term due to affiliates            2,050           2,050              --          20,968
</Table>



                                       50
<PAGE>

The fair value of Jazz Casino's long-term debt and due to affiliates was
determined using valuation techniques that considered cash flows discounted at
current market rates and management's best estimate for instruments without
quoted market prices.

NOTE 7. FEDERAL INCOME TAXES

For the years ended December 31, 2001, 2000, and 1999, the provision (benefit)
for income tax is as follows:

<Table>
<Caption>

                                  2001             2000             1999
                              ------------     ------------     ------------
<S>                           <C>              <C>              <C>
Current income tax benefit    $    (24,752)    $    (52,769)    $    (22,881)
Deferred tax expense                24,752           14,869           22,881
                              ------------     ------------     ------------

Income tax benefit            $         --     $    (37,900)    $         --
                              ============     ============     ============
</Table>

For the years ended December 31, 2001, 2000 and 1999 the effective income tax
rate differs from the statutory federal income tax rate as follows:

<Table>
<Caption>

                                      2001              2000               1999
                                  ------------      ------------      ------------
<S>                               <C>               <C>               <C>
Statutory federal rate                   38.00%           (38.00%)          (38.00%)
State income taxes, net of
  Federal income tax benefit                --                --                --
Valuation allowance                     (44.68)            28.73             38.23
Net operating losses reduction            6.37                --                --
Permanent items                            .36             (0.40)            (0.23)
Other                                    (0.05)               --                --
                                  ------------      ------------      ------------

Effective tax rate                        0.00%            (9.67%)            0.00%
                                  ============      ============      ============
</Table>

Significant components of net deferred tax liabilities as of December 31
consisted of the following:

<Table>
<Caption>

                                                     2001         2000
                                                  ---------     ---------
                                                       (in thousands)
<S>                                               <C>           <C>
Deferred Tax Liabilities:
   Discount on debt                               $  (8,332)    $ (34,339)
   Capitalized interest                                  --          (410)
   Early extinguishment of debt                     (81,110)           --
   Original issue discount                               --        (1,717)
                                                  ---------     ---------
         Total                                      (89,442)      (36,466)
                                                  ---------     ---------

Deferred Tax Assets:
   Net operating loss                                97,061        76,936
   Basis difference in fixed assets                  78,067        88,288
   Basis difference in intangible assets             19,563        22,393
   Accrued reserves                                   2,726         1,354
   Contribution carryover                             1,111           709
   Stock compensation cost                               --            85
   Work opportunity and welfare-to-work credit          282           226
   Self insurance                                       609           753
   Valuation allowance                             (109,977)     (154,278)
                                                  ---------     ---------
         Total                                       89,442        36,466
                                                  ---------     ---------

         Net deferred tax liability               $      --     $      --
                                                  =========     =========
</Table>


                                       51
<PAGE>

At December 31, 2001, we had a valuation allowance to reduce our net deferred
taxes to zero. As of December 31, 2000, the valuation allowance was adjusted to
reduce our net deferred taxes to zero, resulting in an income tax benefit of
$37.9 million. The valuation allowance has been established against the net
deferred tax asset as of December 31, 2001 and 2000 due to the uncertainty of
sufficient future taxable income.

In connection with our reorganization, we had an ownership change as defined by
Internal Revenue Code ("IRC") Section 382. Since the change occurred while under
the jurisdiction of the bankruptcy court, the net operating loss limitations of
IRC Section 382 do not apply. However, our net operating loss carryforwards must
be reduced by certain interest expense previously deducted.

In addition, a deferred tax liability has been recorded in 2001 related to the
extraordinary gain on debt extinguishment not recognized for tax purposes. As
required for federal income tax purposes, we will reduce our tax attributes in
an amount equal to the income not recognized. We, at our option, will reduce our
net operating losses or our basis in depreciable property. Such election will be
made with our 2001 federal income tax return.

As of December 31, 2001, we had a net operating loss carryforward for both
regular tax and alternative minimum tax of $255.4 million that begins to expire
in 2018. In addition, we had a charitable contribution carryforward of
approximately $2.9 million that expires as follows: $0.2 million in 2004; $1.6
million in 2005; and $1.1 million in 2006.

We have tax credit carryforwards for the Work Opportunity Credit and the Welfare
to Work Credit of $179,000 and $103,000, respectively, that begin to expire in
2019. For state income tax purposes, Jazz Casino and JCC Holding have net
operating loss carryforwards of $254.6 million and $1.1 million, respectively,
that begin to expire in 2013.

NOTE 8. RELATED PARTY TRANSACTIONS

Management and Administrative Services Agreements

The Casino's operations are managed by Harrah's New Orleans Management Company
(the "Manager"), a wholly-owned subsidiary of Harrah's Entertainment, pursuant
to the second amended and restated management agreement. Under the terms of the
management agreement in effect prior to the Effective Date, the Manager was
entitled to receive a management fee having two components. The first component
was 3% of annual gross revenues of the Casino. The second component was an
incentive based fee that was equal to 7% of certain consolidated Earnings Before
Interest, Taxes, Depreciation and Amortization ("EBITDA") targets. In addition,
the Manager was entitled to receive a travel fee equal to $100,000 per year,
subject to adjustment based on changes in the Consumer Price Index and a
"marketing contribution," which as of December 31, 2000 was an amount equal to
1.5% of the Casino's net revenues. The Manager had the ability to increase this
marketing contribution from time to time to ensure that it generally equaled the
fee charged to other participating casinos owned or managed in effect prior to
the Effective Date by Harrah's Entertainment's affiliates. Under the terms of
the management agreement, the management fee was deferred until such time as
Jazz Casino met certain interest payment requirements under its various debt
agreements.

Jazz Casino also contracted with Harrah's Operating Company to perform various
administrative services pursuant to an administrative services agreement. The
administrative service agreement, dated October 30, 1998, was renewable each
year. Services to be provided under this agreement included accounting, computer
processing, risk management, marketing and administration of certain human
resource matters. The fees under the administrative agreement were negotiated
annually and were to be paid monthly.

For the years ending December 31, 2001 and 2000, Jazz Casino incurred costs of
$8.0 million and $21.9 million, respectively, under the above agreements.

During 2000, Jazz Casino leased certain employees from Harrah's Entertainment or
its affiliates for approximately $174,000.



                                       52
<PAGE>

On the Effective Date, all fees under the old management agreement were waived
and Jazz Casino entered into the amended management agreement. Under the amended
management agreement, the Manager will continue to be responsible for and have
authority over, among other things:

         o        hiring, supervising and establishing labor policies with
                  respect to employees working in the Casino;

         o        gaming and entertainment policies and operations including
                  security and internal control procedures;

         o        advertising, marketing and promoting the Casino;

         o        providing Casino-level accounting and budgeting services;

         o        maintaining, renovating and improving the Casino;

         o        performing certain system services generally performed at
                  casinos owned or managed by Harrah's Entertainment or its
                  affiliates; and

         o        performing certain other functions identified by Jazz Casino
                  and agreed to by the Manager.

In addition, the Manager and Harrah's Operating Company shall continue to
provide the administrative services formerly provided by Harrah's Operating
Company under the administrative service agreement, which was terminated on the
Effective Date, at no additional costs (other than for insurance and risk
management services).

Under the amended management agreement on the Effective Date, as consideration
for managing the Casino, the Manager is entitled to receive a management fee
equal to thirty percent of earnings before interest, taxes, depreciation,
amortization, and management fees ("EBITDAM"). Under the amended management
agreement, Jazz Casino shall continue to reimburse Harrah's Entertainment for
the cost of property level executive salaries and benefits and shall continue to
reimburse Harrah's Entertainment for insurance related to the Casino. Neither
the Manager or any of its affiliates shall be entitled to receive fees for
services formerly provided under the administrative service agreement, which
services shall be provided at no additional cost (see Note 1).

Our Manager continues to manage the Casino pursuant to our management agreement,
which was amended in connection with our bankruptcy Plan of Reorganization.
Under our Amended Management Agreement, we have the right to terminate the
management agreement if the Casino fails to achieve earnings before interest,
income taxes, depreciation, amortization and management fees, adjusted for
certain state and city costs and corporate overhead costs ("Adjusted EBITDAM"),
of not less than 85% of the specified target Adjusted EBITDAM for the twelve
months ended March 31, 2002, 84% of the specified target Adjusted EBITDAM for
the twelve months ended March 31, 2003, and 83% of the specified target Adjusted
EBITDAM for the twelve months ended March 31, 2004 and thereafter. The targets
of Adjusted EBITDAM for these first three fiscal periods, as specified in the
management agreement, are $115.2 million, $127.4 million, and $134.3 million,
respectively. For the twelve months ended March 31, 2002, the target Adjusted
EBITDAM is 85% of $115.2 million, or $97.9 million. For the nine months ended
December 31, 2001, Adjusted EBITDAM was $77.9 million.

For the year ended December 31, 2001, Jazz Casino incurred costs of $4.4 million
under the Amended Management Agreement.



                                       53
<PAGE>

HET/JCC Agreement

On October 30, 1998, Jazz Casino entered into the HET/JCC Agreement with
Harrah's Entertainment and Harrah's Operating Company, under which Harrah's
Entertainment and Harrah's Operating Company had posted an initial payment
guaranty for the benefit of the State of Louisiana by and through the Louisiana
Gaming Control Board to assure payment of the minimum $100 million annual
payment due to the State of Louisiana under Jazz Casino's amended casino
operating contract. The amounts funded by Harrah's Entertainment to the
Louisiana Gaming Control Board under this agreement took the form of a demand
obligation by Jazz Casino to Harrah's Entertainment and first priority liens on
our assets.

For the years ending December 31, 2001 and 2000, Jazz Casino incurred minimum
payment guaranty fees of approximately $1.5 million and $6.0 million,
respectively under the HET/JCC Agreement.

Under the terms of the minimum payment guaranty, on February 29, 2000, upon
notice by the Louisiana Gaming Control Board that we had failed to make a daily
payment, Harrah's Operating Company, Inc., began making the minimum daily
payments of approximately $274,000 due to the Louisiana Gaming Control Board
under the terms of our casino operating contract.

Because funding under the minimum payment guaranty would constitute a default
under our credit agreement with our bank lenders if our reimbursement obligation
to Harrah's Entertainment and Harrah's Operating Company under the HET/JCC
agreement exceeded $5 million, at our request, our bank lenders granted us a
limited waiver of the default subject to certain conditions. The waiver granted
by the bank lenders allowed funding under the HET/JCC agreement of up to $40
million. This limit was reached on July 20, 2000, at which time we resumed
making the minimum daily payments. On August 31, 2000, the credit agreement was
amended to include additional waivers to allow Harrah's Entertainment and
Harrah's Operating Company to advance up to an additional $10 million under the
HET/JCC agreement, subject to certain limitations, including the requirement
that we must first borrow all of the $25 million available under our revolving
line of credit before additional amounts could be advanced under the minimum
payment guaranty. As of December 31, 2000 and March 29, 2001, Harrah's
Entertainment and Harrah's Operating Company had advanced $44.1 million and
$45.5 million, respectively, to the Louisiana Gaming Control Board on our behalf
under the minimum payment guaranty. The principal balance outstanding bore
interest at LIBOR plus 1% (8.00% as of December 31, 2000).

On the Effective Date, the minimum payment loan along with the guaranty fees and
related interest charges were cancelled and Harrah's Entertainment and Harrah's
Operating Company received Senior Notes and new Common Stock in the amount of
$30.6 million (face value) and approximately 3.1 million shares, respectively.
In addition, Jazz Casino entered into the New HET/JCC Agreement pursuant to
which Harrah's Entertainment will provide a minimum payment guaranty to the
Louisiana Gaming Control Board. Jazz Casino has procured an initial rolling,
four-year minimum payment guaranty guaranteeing the minimum payment required to
be made to the Louisiana Gaming Control Board under the second and third
amendments to the amended and renegotiated casino operating contract, and must
provide rolling, three year minimum payment guaranties thereafter. The initial
minimum payment guaranty will be provided by Harrah's Entertainment, and will
guarantee the following amounts payable to the Louisiana Gaming Control Board:

     o   $50 million in the period April 1, 2001 to March 31, 2002;

     o   $60 million in the period April 1, 2002 to March 31, 2003;

     o   $60 million in the period April 1, 2003 to March 31, 2004; and

     o   $60 million in the period April 1, 2004 to March 31, 2005.

Harrah's Entertainment and Harrah's Operating Company will receive an annual
guaranty fee in the amount of two percent of the total amount at risk at such
time under the minimum payment guaranty. The guaranty fees for the period
through March 31, 2002 shall be deferred and become payable in four equal
installments due on March 31, 2002, March 31, 2003, March 31, 2004, and March
31, 2005, provided that any then unpaid installments of the deferred guaranty
fee for the period through March 31, 2002 shall be due and payable in full upon
any termination of the amended management agreement. For any periods after March
31, 2002, the guaranty fee is payable in four equal installments on June 30,
September 30, December 31 and March 31 of that year. Advances made by Harrah's
Entertainment on Jazz Casino's behalf pursuant to the new HET/JCC agreement
shall bear interest at the rate




                                       54
<PAGE>

specified for loans under the New Revolving Credit Facility (LIBOR plus 3.00%
per annum) and shall be secured on a first lien priority basis by substantially
all of the Debtors' assets (except the second and third amendments to the
amended and renegotiated casino operating agreement, the Casino bankroll and the
Gross Revenue Share Payments (as defined in Note 10)).

For the year ended December 31, 2001, Jazz Casino incurred minimum payment
guaranty fees of $3.1 million under the new HET/JCC Agreement.

Junior Subordinated Credit Facility

Harrah's Entertainment and Harrah's Operating Company provided Jazz Casino with
the $22.5 million junior subordinated credit facility (see Note 6). On the
Effective Date, this Junior Subordinated credit facility was cancelled (see Note
1).

Promissory Note

Harrah's Operating Company provided JCC Development with a $2 million promissory
note (see Note 6). On the Effective Date, this promissory note was cancelled
(see Note 1).

Harrah's Entertainment Loan Guarantee

Harrah's Entertainment and Harrah's Operating Company provided a payment
guaranty with respect to the Tranche A-2 and B-2 term loans and the revolving
line of credit (see Notes 5 and 6). On the Effective Date, this payment guaranty
was cancelled (see Note 1).

Amended Completion Loan Agreement

Harrah's Entertainment and Harrah's Operating Company provided Jazz Casino with
draws on the available completion loan totaling $5.1 million (see Note 6). On
the Effective Date, this completion loan was cancelled (see Note 1).

Equipment Leases

During 1999, Jazz Casino entered into a master lease agreement for approximately
1,900 slot machines with Harrah's Operating Company (see Note 9). On the
Effective Date, this master lease was cancelled (see Note 1).

Limited Forbearance Agreement

On February 29, 2000, Jazz Casino entered into a limited forbearance agreement
with Harrah's Operating Company and Harrah's New Orleans Management Company, the
Manager of our Casino. This agreement was subsequently amended on August 31,
2000. Under this amended forbearance agreement, Harrah's Operating Company and
Harrah's New Orleans Management Company each agreed to forbear until April 1,
2001 certain payments under the management agreement, the administrative
agreement and the master lease agreement that we owed or which become due prior
to April 1, 2001. The amended limited forbearance agreement also waived any
penalties or late charges assessed on the deferred payments under these
agreements. As of December 31, 2000 and March 29, 2001, pursuant to the amended
limited forbearance agreement, we had deferred approximately $18.0 million and
$23.9 million, respectively related to the payments and fees payable to Harrah's
Operating Company or Harrah's New Orleans Management Company.

On the Effective Date, the limited forbearance agreement was cancelled and
Harrah's Operating Company and Harrah's New Orleans Management Company did not
receive New Notes or new Common Stock related to this agreement (see Note 1).




                                       55
<PAGE>




Debtor-in-Possession Financing

Prior to filing our bankruptcy petition, we arranged for a debtor-in-possession
financing facility provided by Harrah's Entertainment and its affiliates. The
principal amounts borrowed under this facility bore interest at LIBOR plus 3.0%.
In 2001, we borrowed $6.3 million under this facility, of which $2.1 million was
repaid in cash and the remaining balance of principal and related accrued
interest was eliminated in accordance with the Plan of Reorganization. (See Note
1).

NOTE 9. LEASES

We lease real estate, office space, and equipment for use in our business
through operating leases. In addition to minimum rentals, certain leases provide
for contingent rents based on percentages of revenue. Real estate operating
leases range from 12 months to 23 years with options for extensions for up to an
additional 20 years. The average remaining term for non-real estate leases
ranges from one to five years.

The Casino Site

Jazz Casino entered into an amended and restated ground lease agreement dated
October 29, 1998 with the Rivergate Development Corporation, as landlord, and
the City of New Orleans, as intervenor, for the site on which the Casino is
located. The initial term of the amended and restated ground lease expires on
August 28, 2023 and contains three consecutive ten-year renewal options. Under
the first amendment to the amended and restated ground lease, entered into in
connection with our reorganization, the initial term of the ground lease is for
23 years from March 31, 2001.

Under the terms of the original ground lease, Harrah's Jazz Company was required
to make an initial payment of $30 million. The amended and restated ground lease
required payments of $736,000 per month until the Casino opened. These monthly
payments were capitalized during the construction of the Casino until opening
and are being amortized over the life of the amended casino operating contract.
Subsequent to October 28, 1999, the minimum lease payment increased to $12.5
million per year. The amended and restated ground lease provides for additional
rents based on various percentages of gross gaming and non-gaming revenues. Jazz
Casino is also required to make a $2.0 million annual contribution to the
Orleans Parish School Board as well as certain additional non-recurring rental
payments totaling $2.25 million over the lease term of which $875,000 was paid
during the year ended December 31, 1999, and $1.4 million was paid during 2001.
The amended and restated ground lease also requires annual payments of
approximately $1.25 million contingent upon gross gaming revenues equaling $325
million under the amendment effective as of March 31, 2001. Jazz Casino was
required to fund this initial amount on a monthly basis in the first fiscal year
of operations. At the end of the first fiscal year of operations, since Jazz
Casino's gross gaming revenues were less than $350 million, no additional
amounts were required to be paid, and the initial funded amount of $1.25
million, which was funded in 2000 and 1999, will be utilized as a credit in the
first fiscal year that gross gaming revenue equals or exceeds $325 million under
the amendment effective as of March 31, 2001. Jazz Casino is further obligated
to pay contingent rent in the event a dividend is declared or if the Manager is
paid a termination fee. Under certain conditions, the Rivergate Development
Corporation has a one-time right to receive additional rent based on the net
market appreciation of JCC Holdings' Common Stock as computed by a defined
formula. Jazz Casino is also required to contribute $1.5 million each year to
the City of New Orleans for a joint marketing fund and to make monthly payments
to a capital replacement fund. The annual aggregate payments to the capital
replacement fund are $3.0 million in the first year of the Casino's operations
and increase $1.0 million in year two and three and in each succeeding year the
payments are based on 2.0% of gross gaming and non-gaming revenues to be paid 10
days in arrears on a monthly basis. For the years ended December 31, 2001, 2000,
and 1999, Jazz Casino has contributed $1.5 million, $1 million and $1 million to
the City of New Orleans for the joint marketing fund, respectively. In addition,
for the years ended December 31, 2001, 2000 and 1999, Jazz Casino has
contributed $4.1 million, $2.8 million and $500,000 in an interest-bearing
account to fund the capital replacement reserve. In connection with the
development of the second floor of the Casino, Jazz Casino is also required to
pay the Rivergate Development Corporation rent equal to 50% of net operating
cash income generated from operations on the second floor of the Casino.

In connection with the reorganization, the City of New Orleans agreed to reduce
the payments and other impositions required in connection with our lease with
the City by $5 million per year. Each item agreed upon either reduces payments
required under the ground lease, or lifts some operating restriction that we
believe will result in improved




                                       56
<PAGE>

operating performance by providing cost savings other than the lease payments or
by providing additional revenue opportunities. Following is a summary of the
items agreed upon:

              o   JCC granted an annual credit of $2.1 million in property tax
                  reduction toward the total reduction, including the property
                  tax reduction achieved in 2001;

              o   A small lot on the corner of Fulton and Poydras Streets, which
                  was previously conveyed by JCC's predecessors to the City of
                  New Orleans, will be returned to JCC either in fee title, if
                  the law allows, or pursuant to a ninety-nine year lease,
                  independent of the Casino lease;

              o   A lease amendment that commits the City to support, assist and
                  cooperate with the development of a hotel on the Fulton Street
                  property;

              o   A City commitment to support, assist and cooperate with our
                  efforts to obtain approvals and permits for all future
                  development. The agreement places time limits on Rivergate
                  Development Corporation review and approval when such is
                  necessary for City permitting;

              o   JCC gained permission to own and operate two courtesy cars and
                  one courtesy bus. The agreement stipulates that if permits are
                  unreasonably denied, JCC may deduct payments of up to $1
                  million from the minimum rent payment to the City;

              o   The language of the amended ground lease was conformed to
                  reflect the recent changes in State law with respect to food
                  services, hotel development and providing complimentary
                  services;

              o   A number of significant adjustments to the reporting, record
                  keeping and other administrative requirements of the open
                  access program and plans, designed to facilitate participation
                  by minorities, women and disadvantaged persons and business
                  enterprises in developing, constructing and operating the
                  Casino, which will result in cost savings and reduction of
                  exposure for defaults under that plan;

              o   The City will agree to a reduction in the number of parking
                  spaces required to be dedicated to Casino use provided we
                  demonstrate that they are not needed to meet Casino use. As a
                  result, any spaces freed up by the reduction, up to 700
                  spaces, may be rented by JCC to third parties under week-day
                  parking contracts, which would provide additional revenue to
                  us; and

              o   Mutual waivers of any defaults that any parties can allege up
                  to the effective date of the amendments and a requirement of
                  the dismissal of all legal proceedings filed by any parties as
                  a result of the $5 million reduction issue.

Slot Leases

In October 1999, Jazz Casino entered into a master lease agreement with Harrah's
Operating Company pursuant to which Jazz Casino leased approximately 1,900 slot
machines. The terms of the various slot machines leased under the master lease
agreement ranged from 3 years to 3.7 years.

On the Effective Date, the master lease agreement was cancelled. Harrah's
Operating Company contributed the slot machines under the master lease agreement
to us in exchange for receiving new Common Stock of approximately 500,000 shares
(see Note 1). The slot machines were recorded at an estimated fair value of $3.6
million.




                                       57
<PAGE>




Future Minimum Rental Commitments

The aggregate contractual future minimum rental commitments, excluding
contingent rentals related to the amended and restated ground lease and after
the Effective Date of the new amended and restated ground lease as of December
31, 2001, are as follows

<Table>
<Caption>

                                              (In thousands)
<S>                                           <C>
         2002                                   $  15,488

         2003                                   $  13,687

         2004                                   $  13,453

         2005                                   $  13,279

         2006                                   $  13,254

         Thereafter                             $  75,050
                                                ---------
         Total Minimum Lease
         Payments                               $ 144,211
                                                =========
</Table>

Scheduled rent increases are amortized on a straight-line basis primarily over
the life of the applicable lease. Lease expense for the years ended December 31,
2001, 2000 and 1999 was approximately $22.6 million, $22.5 million and $6.3
million respectively.

NOTE 10. COMMITMENTS AND CONTINGENCIES

Casino Operating Contract

Pursuant to the original casino operating contract, which commenced on July 15,
1994, the Louisiana Economic Development and Gaming Corporation granted Harrah's
Jazz Company the right to conduct gaming operations at the Casino. On October
30, 1998, all of Harrah's Jazz Company's right, title and interest in and to the
original casino operating contract revested in Harrah's Jazz Company, and the
original casino operating contract was modified by the amended casino operating
contract and assigned to Jazz Casino in accordance with applicable Louisiana law
and the agreement of the parties thereto. The term of the amended casino
operating contract is 20 years, commencing in July 1994, with one automatic ten
year renewal option.

Under the original casino operating contract, Harrah's Jazz Company paid the
Louisiana Economic Development and Gaming Corporation an initial payment of $125
million in installments as well as certain percentage payments based on the
gross gaming revenues from the operations of a temporary casino operated by
Harrah's Jazz Company. Under Jazz Casino's original amended casino operating
contract, during each fiscal year of the Casino's operation, Jazz Casino was
required to pay to the State of Louisiana, by and through the Louisiana Gaming
Control Board, an amount equal to the greater of (i) $100 million or (ii) the
sum of the following percentages of gross gaming revenue from the Casino in a
fiscal year (the "Gross Gaming Revenue Share Payments"):

18.5% of gross gaming revenue up to $600 million
20.0% of gross gaming revenue in excess of $600 million up to $700 million
22.0% of gross gaming revenue in excess of $700 million up to $800 million
24.0% of gross gaming revenue in excess of $800 million up to $900 million
25.0% of gross gaming revenue in excess of $900 million

Under the original amended casino operating contract, Jazz Casino was required
to advance the Louisiana Gaming Control Board up to $3.5 million to reimburse
the Louisiana Gaming Control Board for its actual personnel costs (to include
Louisiana Gaming Control Board, the Louisiana State Police and Louisiana
Attorney General personnel and




                                       58
<PAGE>

contract staff appropriate to the suitability process) that were incurred in
connection with the suitability findings necessary for the execution of the
amended casino operating contract and the opening of the Casino. Harrah's Jazz
Company paid $500,000 of this amount prior to October 30, 1998, and Jazz Casino
advanced $3 million of this amount on October 30, 1998. On October 19, 1999,
Jazz Casino was notified through an amendment to the amended casino operating
contract by the Louisiana Gaming Control Board that the $3.5 million advance
discussed above would not be sufficient to pay the suitability costs and that an
additional $1.7 million would be required. The amendment provided for the $1.7
million to be deducted from the $4.8 million credit due from the Louisiana
Gaming Control Board to Jazz Casino which resulted from an overpayment by
Harrah's Jazz Company in 1995. As of December 31, 2001, the remaining credit of
$3.1 million is in other long-term assets. Jazz Casino is entitled to offset
this credit against daily payments to the Louisiana Gaming Control Board on or
after April 1, 2003 subject to certain stipulations under the second and third
amendments to the amended and renegotiated casino operating contract as
described below.

The original amended casino operating contract obligates Jazz Casino to maintain
a capital replacement fund. The capital replacement fund is the same as that
required pursuant to Jazz Casino's amended and restated ground lease with the
Rivergate Development Corporation and the City of New Orleans and its management
agreement with the Manager and is not meant to duplicate the capital replacement
fund obligations under those agreements (see Note 9).

Under the original amended casino operating contract, the Casino was prohibited
from engaging in certain activities related to food, lodging and retail, which
also applies to our operations on the second floor of the Casino. The amended
casino operating contract also imposed certain financial stability requirements
on Jazz Casino relating to its ability to meet ongoing operating expenses,
casino bankroll requirements, projected debt payments and capital maintenance
requirements.

Since the Effective Date, Jazz Casino now operates under a third amendment to
the amended and renegotiated casino operating contract establishing the minimum
payments to the Louisiana Gaming Control Board at the greater of (i) 21.5% of
gross gaming revenues from the Casino in the applicable casino operating
contract fiscal year or (ii) $50 million for the period from April 1, 2001 to
March 31, 2002, and $60 million for each annual period thereafter. In addition,
Jazz Casino will pay an override on gross gaming revenues equal to (i) 1.5% of
gross gaming revenues in excess of $500 million, up to $700 million, (ii) 3.5%
for gross gaming revenues in excess of $700 million, up to $800 million, (iii)
5.5% for gross gaming revenues in excess of $800 million, up to $900 million,
and (iv) 7.5% for gross gaming revenues in excess of $900 million.

Jazz Casino was required to procure an initial rolling, four-year minimum
payment guaranty guaranteeing the minimum payments required to be made to the
Louisiana Gaming Control Board under the third amendment to the amended and
renegotiated casino operating contract, and must provide rolling, three-year
minimum payment guaranties thereafter. By March 31 of each year (beginning with
March 31, 2003), Jazz Casino must obtain a minimum payment guaranty (or
extension thereof) extending the minimum payment guaranty to the third
anniversary of such date, so that three years of future payments to the
Louisiana Gaming Control Board are guaranteed. Jazz Casino need not procure the
guaranty if its gross gaming income exceeds $350 million for two successive
years with no defaults by Jazz Casino and certain other financial tests are met.

In addition, certain restrictions previously imposed on food and restaurant
facilities and service, lodging or the sale of products not directly related to
gaming operations have been modified.

General Development Agreement

The general development agreement entered into with the Rivergate Development
Corporation sets forth the obligations of the parties and the procedures to be
followed relating to the design, development and construction of the Casino and
certain related facilities. Jazz Casino is obligated to reimburse the Rivergate
Development Corporation for certain costs incurred during the construction of
the Casino and certain of its parking facilities, totaling approximately
$280,000. Since 1999, Jazz Casino reimbursed the Rivergate Development
Corporation for approximately $248,000 of these costs.



                                       59
<PAGE>

Amended Open Access Program and Plans

The amended open access program and plans require Jazz Casino to form a special
purpose corporation to foster new and existing businesses owned and controlled
by minorities, women and disadvantaged people. Harrah's Jazz Company was
required to capitalize this corporation with $500,000. Jazz Casino will
underwrite its operations at a minimum of $250,000 per year for five years. The
first $250,000 payment was required to be paid on October 30, 1998 with
subsequent annual payments payable quarterly in equal installments of $62,500.
Jazz Casino must also contribute an additional $500,000 per year for five years
to promote similar public support efforts, in accordance with standards to be
established by the Company. The first annual installment was due on October 28,
1999, with the remaining installments to be funded quarterly in equal
installments of $125,000. Effective in 2001, the installments are to be funded
semi-annually. Jazz Casino is required to deposit these amounts into a separate
account and then fund contributions to qualified recipients based upon certain
criteria. For the years ended December 31, 2001, 2000 and 1999, Jazz Casino has
contributed $750,000, $750,000 and $187,000, respectively related to the amended
open access program and plans.

Audubon Institute Agreement

On October 30, 1998, Jazz Casino assumed the obligations related to a ticket
purchase agreement with the Audubon Institute whereby Jazz Casino has agreed to
purchase tickets from the Audubon Institute for a minimum of $375,000 per year
for the first six years of Casino operations. This amount is subject to increase
based on increasing gross gaming revenue levels achieved by Jazz Casino. For the
years ended December 31, 2001, 2000 and 1999, Jazz Casino has contributed
$375,000, $375,000 and $125,000, respectively, related to the ticket purchase
agreement.

Other Contingencies

We have various commitments to Harrah's Entertainment and its affiliates (see
Note 8).

The enactment and implementation of gaming legislation in the State of Louisiana
and the development of the Casino, and related facilities have been subject to
lawsuits, claims and delays brought about by various parties. In addition, we
are involved in a number of legal proceedings and claims arising in the normal
course of business. While we cannot predict the outcome of such legislative
proceedings and litigation, we do not expect that the final outcome of these
matters will materially and adversely affect our results of operations, cash
flows, or financial condition.

         Following our reduction in the Casino's work force on July 17, 2001,
former employees of the Casino filed lawsuits against us in the Civil District
Court for the Parish of Orleans, State of Louisiana on August 3, 2001. Since
filing, the matter was removed to the United States District Court for the
Eastern District of Louisiana. Plaintiffs have filed a Motion to Remand the
lawsuit to state court, which is currently pending. The Plaintiffs are seeking
damages for being laid off prior to the expiration of the term of alleged
employment contracts between our employees and us. We believe that we have
strong legal and factual defenses, and intend to vigorously contest the claims.
No assurances can be given as to the outcome of such lawsuit, and consequently,
we cannot reasonably predict at this time whether the final outcome of these
matters will materially and adversely affect our results of operations, cash
flows, or financial condition.

NOTE 11. EMPLOYEE BENEFIT PLANS

We have established the following employee and non-employee programs.

Jazz Casino Company 401(k) Plan. On November 27, 1998, we established a defined
contribution savings and retirement plan, which among other things, allows
pretax and after-tax contributions to be made by employees to the plan. Under
the plan, participating employees may elect to contribute up to 16 percent of
their eligible earnings, the first six percent of which is fully matched by us.
Under the terms of the plan, we may also elect to make an additional
discretionary contribution. Amounts contributed to the plan are invested at the
participant's direction in a money market fund, a bond fund, two balanced funds,
a small capitalization stock fund, a Standard and Poor's 500 Index Fund, or an
international stock fund. Participants become vested in the matching
contribution over five years




                                       60
<PAGE>

of credited service. Our contribution expense for the years ended December 31,
2001, 2000 and 1999 was approximately $1.4 million, $626,000, and $46,000,
respectively.

1998 Long-Term Incentive Plan. On October 29, 1998, the board of directors
adopted the JCC Holding 1998 Long-Term Incentive Plan, which received
stockholder approval on May 13, 1999. Under the terms of the long-term incentive
plan, as amended to apply to the new Common Stock pursuant to our Plan of
Reorganization, the following can be awarded to employees, officers, consultants
and directors: restricted cash awards, stock options, stock appreciation rights,
performance units, restricted stock, dividend equivalents, other stock-based
awards or any other right or interest relating to Common Stock. JCC Holding has
reserved for issuance upon the grant or exercise of the above awards, 750,000
shares of the authorized but unissued shares of Common Stock. During the year
ended December 31, 2001, JCC Holding granted options to purchase 175,306 shares
of Common Stock under this plan.

During the year ended December 31, 2000, we granted 145,000 shares of restricted
class A common stock under the long-term incentive plan. During the year ended
December 31, 1999, JCC Holding granted options to purchase an aggregate of
214,835 shares of class A common stock and 24,664 shares of restricted class A
common stock under the long-term incentive plan. All the shares covered by these
awards were eliminated on the Effective Date.

1999 Non-Employee Director Stock Option Plan. On March 4, 1999, the board of
directors adopted the 1999 Non-Employee Director Stock Option Plan, which
received stockholder approval on May 13, 1999. Under the terms of JCC Holding's
director stock option plan, options to purchase class A common stock could be
awarded to certain non-employee directors of JCC Holding. JCC Holding had
reserved for issuance upon the exercise of stock options granted under JCC
Holding's director stock option plan an aggregate of 150,000 shares of the
authorized but unissued shares of class A common stock. During the year ended
December 31, 1999, JCC Holding granted options to purchase an aggregate of
20,000 shares of class A common stock under JCC Holding's director stock option
plan. On the Effective Date, the director stock options were cancelled (see Note
1). This plan is no longer in effect.

Stock Option Awards. A stock option grant under JCC Holding's long-term
incentive plan typically vests in equal installments over a four year period and
allows the option holder to purchase stock over specified periods of time,
generally ten years from the date of grant, at a fixed price equal to the market
value at the date of grant. Options granted under JCC Holding's director stock
option plan were immediately exercisable.

As of December 31, 2000, there were 208,889 outstanding stock options with
exercise prices ranging from $3.50 to $7.56 and weighted average remaining
contractual lives of 8.7 years. As of December 31, 2000, there were 158,250
exercisable stock options with a weighted average exercise price of $4.04. The
weighted average fair value per share of options granted during 1999 was $5.59.
On the Effective Date, these stock options were cancelled (see Note 1).

As of December 31, 2001, there were 175,306 outstanding stock options with
exercise prices of $3.20 and weighted average remaining contractual lives of 9.8
years. As of December 31, 2001, there were no exercisable stock options. The
weighted average fair value per share of options granted during 2001 was $1.85.

Had compensation cost for the stock options granted in 2001 been determined
under SFAS 123, based on the fair market value at the grant dates, the Company's
pro forma net income and net income per share for the year ended December 31,
2001 would have been $91.7 million and $7.40, respectively.

The fair value of each option grant is estimated at the date of grant using the
Black Scholes option pricing model with the following weighted average
assumptions used for those options granted in 2001: expected volatility of 210%,
risk-free interest rate of 6.05%, expected lives of 10 years and no dividend
yield rate.

Restricted Stock Awards. Restricted stock awards have full voting and dividend
rights during the restricted period; however, the shares are restricted as to
transfer and subject to forfeiture during a specified period or periods prior to
vesting. The compensation arising from a grant of restricted stock awards is
based upon the market price at the grant date. Such expense is deferred and
amortized to expense over the vesting period. On the Effective Date, the
previously issued restricted stock awards were cancelled (see Note 1).



                                       61
<PAGE>

Deferred Compensation Plans. On November 18, 1999, JCC Holding's board of
directors approved two deferred compensation plans under which certain
executives and employees could defer a portion of their compensation. Amounts
deposited into these plans are our unsecured liabilities and earn interest at
rates approved by the compensation committee of the board of directors. The
first plan year for each of these plans commenced on January 1, 2000 and the
liability related to deferred compensation as of December 31, 2000 was
approximately $11,000. On the Effective Date, this plan was not reinstated.

NOTE 12. STOCKHOLDERS' EQUITY

Pursuant to the Harrah's Jazz Company 1998 plan of reorganization, the capital
stock of JCC Holding consisted of shares of class A common stock, class B common
stock, and unclassified common stock. With certain exceptions, including the
election of directors and the right to separate class voting with respect to
certain amendments to JCC Holding's Certificate of Incorporation and Bylaws,
each share of class A, class B and unclassified common stock had identical
rights and privileges, and ranked equally, shared ratably and was identical in
every respect and as to all matters, including rights in liquidation, and was
entitled to vote upon all matters submitted to a vote of the common
stockholders, was entitled to one vote for each share held, and, except as
otherwise required by law, the holders of shares of class A, class B and
unclassified common stock generally voted together as one class on all matters
submitted to a vote of stockholders.

Harrah's Entertainment Warrants. Pursuant to a warrant agreement between JCC
Holding and Harrah's Crescent City Investment Company dated October 30, 1998,
Harrah's Crescent City Investment Company received warrants entitling it to
purchase additional shares of JCC Holding Unclassified Common Stock such that,
upon exercise of the warrant in its entirety, Harrah's Entertainment and its
subsidiaries, including Harrah's Crescent City Investment Company, would own in
the aggregate 50.0% of the then outstanding shares of Unclassified Common Stock,
subject to certain adjustments. On the Effective Date, these warrants were
eliminated as a result of the Plan of Reorganization.

On the Effective Date, JCC Holding's class A common stock and class B common
stock were cancelled. The class A common stockholders and class B common
stockholders did not receive any distributions for their respective stock. On
the Effective Date, the outstanding new Common Stock of JCC Holding consisted of
12,386,200 shares of new Common Stock. In consideration of, among other things,
Harrah's Entertainment's and Harrah's Operating Company's consent to the
cancellation and extinguishment of all claims against us arising under the
revolving credit facility, the tranche A-2 term loan, the tranche B-2 term loan,
the slot lease, the junior subordinated credit facility, the completion loan
agreement and the promissory note, it and its affiliates' agreement to waive all
claims relating to existing defaults under the management agreement, the
administrative services agreement, the forbearance agreement, the warrant
agreement, and any other pre-petition claims against us, and Harrah's Operating
Company's agreement to contribute the slot machines to the Company, Harrah's
Entertainment received 6,069,238 shares (49%) of the new Common Stock; holders
of claims arising under the tranche B-1 term loan of the bank credit facilities
received 1,734,068 shares (14%) of the new Common Stock; and holders of claims
arising under the senior subordinated notes will receive 4,582,894 shares (37%)
of our new Common Stock (see Note 1).

The Board of Directors of JCC Holding Company consists of seven directors. Four
of the initial directors were selected by the noteholders committee and Bankers
Trust Company, and three of the initial directors were selected by Harrah's
Entertainment. The three directors selected by Harrah's Entertainment have one
one-year, one two-year and one three-year term, and the four directors elected
by the noteholders committee and Bankers Trust Company will initially have one
one-year, one two-year and two three-year terms.

NOTE 13. GUARANTOR FINANCIAL INFORMATION

JCC Holding and all of its other wholly owned subsidiaries (the "Guarantor
Subsidiaries") have fully and unconditionally guaranteed on a joint and several
basis Jazz Casino's obligations under the Senior Notes described in Note 6. The
Guarantor Subsidiaries and Jazz Casino comprise all of the direct and indirect
subsidiaries of the Company. All of the assets of JCC Holding's subsidiaries are
restricted and may not be transferred to JCC Holding in the form of loans, cash
or dividends without the consent of a third party. The following consolidating
schedules present condensed financial information on a combined basis as of and
for the years ended December 31, 2001, 2000 and 1999:



                                       62
<PAGE>
                      JCC HOLDING COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATING BALANCE SHEETS
                                DECEMBER 31, 2001
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)

<Table>
<Caption>

                                                       JAZZ CASINO     JCC HOLDING      GUARANTOR                     CONSOLIDATED
                                                         COMPANY         COMPANY       SUBSIDIARIES   ELIMINATIONS        TOTAL
                                                       ------------    ------------    ------------   ------------    ------------
<S>                                                    <C>             <C>             <C>            <C>             <C>
                                  ASSETS
Current Assets:

    Cash and cash equivalents                          $     36,016    $         13    $      5,673   $         --    $     41,702
    Accounts receivable, net of
      allowance for doubtful accounts                         3,414              --              --             --           3,414
    Intercompany receivables                                  1,972              --              --         (1,972)             --
    Inventories                                                 639              --              --             --             639
    Prepaids and other assets                                 2,162              --              --             --           2,162
                                                       ------------    ------------    ------------   ------------    ------------
              Total current assets                           44,203              13           5,673         (1,972)         47,917
                                                       ------------    ------------    ------------   ------------    ------------
Property and Equipment:
    Buildings on leased land                                129,027              --              --             --         129,027
    Furniture, fixtures and equipment                        28,406              --              --             --          28,406
    Property held for development                                --              --          10,708             --          10,708
    Leasehold improvements                                      284              --              --             --             284
    Construction in progress                                     82              --             227             --             309
                                                       ------------    ------------    ------------   ------------    ------------
              Total                                         157,799              --          10,935             --         168,734
    Less - accumulated depreciation                         (35,253)             --              --             --         (35,253)
                                                       ------------    ------------    ------------   ------------    ------------
              Net property and equipment                    122,546              --          10,935             --         133,481
                                                       ------------    ------------    ------------   ------------    ------------
Other Assets:
    Deferred operating contract cost,                        24,454              --              --             --          24,454
    net of accumulated amortization
    Lease prepayment, net of                                  6,046              --              --             --           6,046
    accumulated amortization
    Deferred charges and other, net of                       11,196              --              29             --          11,225
    accumulated amortization
    Investment in Subsidiary                                     --          88,941              --        (88,941)             --
                                                       ------------    ------------    ------------   ------------    ------------
              Total other assets                             41,696          88,941              29        (88,941)         41,725
                                                       ------------    ------------    ------------   ------------    ------------
                         TOTAL ASSETS                  $    208,445    $     88,954    $     16,637   $    (90,913)   $    223,123
                                                       ============    ============    ============   ============    ============


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities:
    Accounts payable - trade                           $      2,196    $         --    $         --   $         --    $      2,196
    Accrued interest                                             --              --              --             --              --
    Accrued expenses                                         17,200              30               1             --          17,231
    Due to affiliates                                         4,591              --              --             --           4,591
    Intercompany payables                                        --             909           1,063         (1,972)             --
    Preconfirmation contingencies                               900              --              --             --             900
    Other                                                     2,036              --              --             --           2,036
                                                       ------------    ------------    ------------   ------------    ------------
              Total current liabilities                      26,923             939           1,064         (1,972)         26,954
                                                       ------------    ------------    ------------   ------------    ------------
Long-Term Debt, net of discount                             105,676              --              --             --         105,676

Due to affiliates                                             2,050              --              --             --           2,050
Other long-term liabilities                                     428              --              --             --             428

Commitments and Contingencies

Stockholders' Equity (Deficit):
    Common Stock:
       Unclassified common stock (40,000
           shares authorized; 12,386
           shares issued and outstanding; par
           value $.01 per share)                                 --             124              --             --             124
    Additional paid-in capital                              398,148         413,150          14,866       (413,014)        413,150
    Member capital                                                1              --              --             (1)             --
    Retained earnings (accumulated deficit)                (324,781)       (325,259)            707        324,074        (325,259)
                                                       ------------    ------------    ------------   ------------    ------------
           Total stockholders' equity (deficit)              73,368          88,015          15,573        (88,941)         88,015
                                                       ------------    ------------    ------------   ------------    ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)   $    208,445    $     88,954    $     16,637   $    (90,913)   $    223,123
                                                       ============    ============    ============   ============    ============
</Table>



                                       63
<PAGE>

                      JCC HOLDING COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATING BALANCE SHEETS
                                DECEMBER 31, 2000
                     (IN THOUSANDS, EXCEPT PER SHARE DATA)


<Table>
<Caption>

                                                        JAZZ CASINO    JCC HOLDING      GUARANTOR                      CONSOLIDATED
                                                         COMPANY         COMPANY       SUBSIDIARIES    ELIMINATIONS       TOTAL
                                                       ------------    ------------    ------------    ------------    ------------
<S>                                                    <C>             <C>             <C>             <C>             <C>
                              ASSETS
Current Assets:

    Cash and cash equivalents                          $     26,602    $         14    $         10    $         --    $     26,626
    Accounts receivable, net of allowance
       for doubtful accounts                                  8,017              --               1          (1,746)          6,272
    Inventories                                                 685              --              --              --             685
    Prepaids and other assets                                 3,678              --              --              --           3,678
    Property available for sale                                  --              --           4,831              --           4,831
                                                       ------------    ------------    ------------    ------------    ------------
               Total current assets                          38,982              14           4,842          (1,746)         42,092
                                                       ------------    ------------    ------------    ------------    ------------
Property and Equipment                                      151,735              --          10,716              --         162,451
    Less - accumulated depreciation                         (25,561)             --              --              --         (25,561)
                                                       ------------    ------------    ------------    ------------    ------------
               Net Property and Equipment                   126,174              --          10,716              --         136,890
                                                       ------------    ------------    ------------    ------------    ------------
Other Assets:
     Deferred operating contract costs,
        net of accumulated amortization                      25,536              --              --              --          25,536
     Lease prepayment, net of accumulated
        amortization                                          6,312              --              --              --           6,312
     Deferred charges and other, net of
        accumulated amortization                             10,589              --              42              --          10,631
                                                       ------------    ------------    ------------    ------------    ------------
               Total other assets                            42,437              --              42              --          42,479
                                                       ------------    ------------    ------------    ------------    ------------
                              TOTAL ASSETS             $    207,593    $         14    $     15,600    $     (1,746)   $    221,461
                                                       ============    ============    ============    ============    ============

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities:

     Short-term borrowings                             $     23,250    $         --    $         --    $         --    $     23,250
     Accounts payable - trade                                   845             757             988          (1,746)            844
     Accrued interest                                         7,025              --              --              --           7,025
     Accrued expenses                                        12,270              30               1              --          12,301
     Due to affiliate                                        64,806              --              --              --          64,806
     Preconfirmation contingencies                            2,212              --              --              --           2,212
     Other                                                    1,977              --              --              --           1,977
                                                       ------------    ------------    ------------    ------------    ------------
               Total Current Liabilities                    112,385             787             989          (1,746)        112,415
                                                       ------------    ------------    ------------    ------------    ------------
Long-term debt                                              394,759              --           1,653              --         396,412

Due to affiliate                                             20,943              --              25              --          20,968
Other long-term liabilities                                     339              --              --              --             339
Investment in Subsidiaries                                       --         307,900              --        (307,900)             --

Stockholder's Equity (Deficit):
Class A common stock                                             --              58              --              --              58
Class B common stock                                             --              45              --              --              45
Additional paid-in capital                                   94,926         108,269          13,187        (108,113)        108,269
Accumulated deficit                                        (415,759)       (417,045)           (254)        416,013        (417,045)
Less: Unearned compensation                                      --              --              --              --              --
                                                       ------------    ------------    ------------    ------------    ------------
           Total stockholder's equity (deficit)            (320,833)       (308,673)         12,933         307,900        (308,673)
                                                       ------------    ------------    ------------    ------------    ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)   $    207,593    $         14    $     15,600    $     (1,746)   $    221,461
                                                       ============    ============    ============    ============    ============
</Table>



                                       64

<PAGE>
                 JCC HOLDING COMPANY AND SUBSIDIARIES CONDENSED
                     CONSOLIDATING STATEMENTS OF OPERATIONS
                      FOR THE YEAR ENDED DECEMBER 31, 2001
                       (IN THOUSANDS, EXCEPT SHARE DATA)

<Table>
<Caption>

                                                     JAZZ CASINO    JCC HOLDING    GUARANTOR                    CONSOLIDATED
                                                       COMPANY        COMPANY     SUBSIDIARIES   ELIMINATIONS       TOTAL
                                                     -----------    -----------   ------------   ------------   ------------
<S>                                                  <C>            <C>            <C>            <C>            <C>
Revenues:
     Casino                                          $   242,950    $        --    $        --    $        --    $   242,950
     Food and beverage                                    21,673             --             --             --         21,673
     Retail, parking and other                            10,806             --             10             --         10,816
     Less - casino promotional allowances                (36,792)            --             --             --        (36,792)
                                                     -----------    -----------    -----------    -----------    -----------
           Total net revenues                            238,637             --             10             --        238,647
                                                     -----------    -----------    -----------    -----------    -----------
Operating Expenses:
     Direct:
           Casino                                        147,077             --             --             --        147,077
           Food and beverage                              15,791             --             --             --         15,791
           Retail, parking and other                       3,977             --             --             --          3,977
     General and administrative                           75,179            151            208             --         75,538
     Depreciation and amortization                        11,807             --              5             --         11,812
     Equity in Subsidiary income                              --        (91,937)            --         91,937             --
                                                     -----------    -----------    -----------    -----------    -----------
           Total operating expenses                      253,831        (91,786)           213         91,937        254,195
                                                     -----------    -----------    -----------    -----------    -----------
Operating Income (Loss)                                  (15,194)        91,786           (203)       (91,937)       (15,548)
                                                     -----------    -----------    -----------    -----------    -----------
Reorganization Expenses                                 (101,029)            --             --             --       (101,029)
Preconfirmation Contingencies                              1,824             --             --             --          1,824

Other income (expenses):
     Interest expense, net of capitalized interest        (8,495)            --             --             --         (8,495)
     Interest and other income                               421             --          1,165             --          1,586
                                                     -----------    -----------    -----------    -----------    -----------
           Total other income (expenses)                  (8,074)            --          1,165             --         (6,909)
                                                     -----------    -----------    -----------    -----------    -----------
Income (Loss) Before Taxes and Extraordinary Items      (122,473)        91,786            962        (91,937)      (121,662)

Income Tax Benefit                                            --             --             --             --             --
                                                     -----------    -----------    -----------    -----------    -----------
Income (Loss) Before Extraordinary Item                 (122,473)        91,786            962        (91,937)      (121,662)
                                                     -----------    -----------    -----------    -----------    -----------
Extraordinary Gain on Early Extinguishment of Debt       213,448             --             --             --        213,448
                                                     -----------    -----------    -----------    -----------    -----------
Net Income (Loss)                                    $    90,975    $    91,786    $       962    $   (91,937)   $    91,786
                                                     ===========    ===========    ===========    ===========    ===========
</Table>


                                       65

<PAGE>
                      JCC HOLDING COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
                      FOR THE YEAR ENDED DECEMBER 31, 2000
                       (IN THOUSANDS, EXCEPT SHARE DATA)


<Table>
<Caption>

                                                     JAZZ CASINO     JCC HOLDING      GUARANTOR                      CONSOLIDATED
                                                       COMPANY         COMPANY       SUBSIDIARIES    ELIMINATIONS       TOTAL
                                                     ------------    ------------    ------------    ------------    ------------
<S>                                                  <C>             <C>             <C>             <C>             <C>
Revenues:
     Casino                                          $    245,473    $         --    $         --    $         --    $    245,473
     Food and beverage                                     20,356              --              --              --          20,356
     Retail, parking and other                              9,798              --              23              --           9,821
     Less - casino promotional allowances                 (33,536)             --              --              --         (33,536)
                                                     ------------    ------------    ------------    ------------    ------------
           Total net revenues                             242,091              --              23              --         242,114
                                                     ------------    ------------    ------------    ------------    ------------
Operating Expenses:
     Direct:
           Casino                                         196,185              --              --              --         196,185
           Food and beverage                               16,131              --              --              --          16,131
           Retail, parking and other                        4,123              --              10              --           4,133
     General and administrative                            85,951             286             150              --          86,387
     Depreciation and amortization                         26,334              --               5              --          26,339
     Provision for asset impairment                       258,674              --             138              --         258,812
     Equity in Subsidiary losses                               --         353,942              --        (353,942)             --
                                                     ------------    ------------    ------------    ------------    ------------
           Total operating expenses                       587,398         354,228             303        (353,942)        587,987
                                                     ------------    ------------    ------------    ------------    ------------
Operating Loss                                           (345,307)       (354,228)           (280)        353,942        (345,873)
                                                     ------------    ------------    ------------    ------------    ------------
Other income (expenses):
     Interest expense, net of capitalized interest        (46,668)             --              --              --         (46,668)
     Interest and other income                                411              --               2              --             413
                                                     ------------    ------------    ------------    ------------    ------------
           Total other income (expenses)                  (46,257)             --               2              --         (46,255)
                                                     ------------    ------------    ------------    ------------    ------------
Loss Before Taxes                                        (391,564)       (354,228)           (278)        353,942        (392,128)

Income Tax Benefit                                         37,900              --              --              --          37,900
                                                     ------------    ------------    ------------    ------------    ------------
Net Loss                                             $   (353,664)   $   (354,228)   $       (278)   $    353,942    $   (354,228)
                                                     ============    ============    ============    ============    ============
</Table>

                                       66

<PAGE>
                 JCC HOLDING COMPANY AND SUBSIDIARIES CONDENSED
                     CONSOLIDATING STATEMENTS OF OPERATIONS
                      FOR THE YEAR ENDED DECEMBER 31, 1999
                       (IN THOUSANDS, EXCEPT SHARE DATA)

<Table>
<Caption>

                                                      JAZZ CASINO     JCC HOLDING      GUARANTOR                     CONSOLIDATED
                                                        COMPANY         COMPANY       SUBSIDIARIES   ELIMINATIONS       TOTAL
                                                      ------------    ------------    ------------   ------------    ------------
<S>                                                   <C>             <C>             <C>            <C>             <C>
Revenues:
      Casino                                          $     38,005    $         --    $         --   $         --    $     38,005
      Food and beverage                                      3,693              --              --             --           3,693
      Retail, parking and other                              1,796              --              23             --           1,819
      Less - casino promotional allowances                  (3,260)             --              --             --          (3,260)
                                                      ------------    ------------    ------------   ------------    ------------
           Total net revenues                               40,234              --              23             --          40,257
                                                      ------------    ------------    ------------   ------------    ------------
Operating Expenses:
      Direct:
           Casino                                           34,114              --              --             --          34,114
           Food and beverage                                 2,875              --              --             --           2,875
           Retail, parking and other                         1,200              --              --             --           1,200
General and administrative                                  15,602             437               7             --          16,046
Depreciation and amortization                                5,102              --               5             --           5,107
Pre-opening Expenses                                        35,160              --              --             --          35,160
Equity in Subsidiary losses                                     --          58,703              --        (58,703)             --
                                                      ------------    ------------    ------------   ------------    ------------
           Total operating expenses                         94,053          59,140              12        (58,703)         94,502
                                                      ============    ============    ============   ============    ============

Operating Loss                                             (53,819)        (59,140)             11         58,703         (54,245)
                                                      ------------    ------------    ------------   ------------    ------------
Reorganization Item                                          1,562              --              --             --           1,562

Other income (expenses):
      Interest expense, net of capitalized interest         (6,869)             --              --             --          (6,869)
      Interest and other income                                412              --              --             --             412
                                                      ------------    ------------    ------------   ------------    ------------
           Total other income (expense)                     (6,457)             --              --             --          (6,457)
                                                      ------------    ------------    ------------   ------------    ------------
Income (Loss) Before Taxes                                 (58,714)        (59,140)             11         58,703         (59,140)
Income Tax Benefit                                              --              --              --             --              --
                                                      ------------    ------------    ------------   ------------    ------------
Net Loss                                              $    (58,714)   $    (59,140)   $         11   $     58,703    $    (59,140)
                                                      ============    ============    ============   ============    ============
</Table>




                                       67

<PAGE>
                      JCC HOLDING COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                      FOR THE YEAR ENDED DECEMBER 31, 2001
                                 (IN THOUSANDS)

<Table>
<Caption>

                                                               JAZZ CASINO  JCC HOLDING    GUARANTOR                   CONSOLIDATED
                                                                 COMPANY      COMPANY     SUBSIDIARIES  ELIMINATIONS       TOTAL
                                                               ----------   -----------   ------------  ------------   ------------
<S>                                                            <C>           <C>          <C>              <C>         <C>
Cash Flows From Operating Activities:
     Net income (loss)                                         $   90,975    $  91,786    $        962     $ (91,937)  $     91,786
     Adjustments to reconcile net income (loss) to net
          cash provided by (used in) operating activities:

          Depreciation and amortization                            11,807           --               5            --         11,812
          Amortization of note discount                            92,008           --              --            --         92,008
          Extraordinary gain on early extinguishment of debt     (213,448)          --              --            --       (213,448)
          Deferred rent                                               322           --              --            --            322
          Provision for bad debts                                   2,426           --              --            --          2,426
          Write-off of preconfirmation contingencies               (1,824)          --              --            --         (1,824)
          Gain on sale of property and equipment                       --           --          (1,167)           --         (1,167)
          Equity in Subsidiary income                                  --      (91,937)             --        91,937             --
     Changes in operating assets and liabilities:
          Accounts receivable                                         431           --              --            --            431
          Inventories                                                  46           --              --            --             46
          Prepaids and other assets                                 1,516           --              --            --          1,516
          Intercompany receivable/payable                            (235)         150              85            --             --
          Accounts payable - trade                                  1,352           --              --            --          1,352
          Accrued interest                                             --           --              --            --             --
          Accrued expenses                                          4,930           --              --            --          4,930
          Preconfirmation contingencies                              (256)          --              --            --           (256)
          Due to affiliates                                        16,591           --              --            --         16,591
          Other current liabilities                                    58           --              --            --             58
     Payment of liabilities subject to compromise due to
          reorganization activities:
          Reorganization costs, excluding amortization of
             note discount of $90,314                              10,715           --              --            --         10,715
          Payment of reorganization costs                          (9,947)          --              --            --         (9,947)
                                                               ----------    ---------    ------------  ------------   ------------
                Net cash flows provided by (used in)
                    operating activities                            7,467           (1)           (115)           --          7,351
                                                               ----------    ---------    ------------  ------------   ------------
Cash Flows From Investing Activities:
     Capital expenditures                                          (2,448)          --            (223)           --         (2,671)
     Proceeds from sale of property                                    --           --           5,998            --          5,998
     Increase in deferred charges and other assets                 (1,350)          --               3            --         (1,347)
                                                               ----------    ---------    ------------  ------------   ------------
                Net cash flows provided by (used in)
                    investing activities                           (3,798)          --           5,778            --          1,980
                                                               ----------    ---------    ------------  ------------   ------------
Cash Flows From Financing Activities:
     Proceeds from notes payable - affiliate                        5,745           --              --            --          5,745
                                                               ----------    ---------    ------------  ------------   ------------
                Net cash flows provided by financing
                    activities                                      5,745           --              --            --          5,745
                                                               ----------    ---------    ------------  ------------   ------------
Net increase (decrease) in cash and cash equivalents                9,414           (1)          5,663            --         15,076

Cash and cash equivalents, beginning of period                     26,602           14              10            --         26,626
                                                               ----------    ---------    ------------  ------------   ------------
Cash and cash equivalents, end of period                       $   36,016    $      13    $      5,673  $         --   $     41,702
                                                               ==========    =========    ============  ============   ============
</Table>




                                       68

<PAGE>
                      JCC HOLDING COMPANY AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                      FOR THE YEAR ENDED DECEMBER 31, 2000
                                 (IN THOUSANDS)

<Table>
<Caption>

                                                   JAZZ CASINO    JCC HOLDING     GUARANTOR                    CONSOLIDATED
                                                     COMPANY        COMPANY      SUBSIDIARIES   ELIMINATIONS      TOTAL
                                                   ------------   ------------   ------------   ------------   ------------
<S>                                                <C>            <C>            <C>            <C>            <C>

Cash Flows From Operating Activities:
     Net loss                                       $  (353,664)  $   (354,228)  $       (278)  $    353,942   $   (354,228)
     Adjustments to reconcile net
            loss to net cash provided by
              (used in)
            operating activities:
            Depreciation and amortization                26,334             --              5             --         26,339
            Amortization of note discount                 5,369             --             --             --          5,369
            Deferred rent                                 1,624             --             --             --          1,624
            Provision for bad debts                       1,770             --             --             --          1,770
            Provision for asset impairment              258,674             --            138             --        258,812
            Deferred income taxes                       (37,900)            --             --             --        (37,900)
            Equity in Subsidiary losses                      --        353,942             --       (353,942)            --
     Changes in operating assets
            and liabilities:
            Accounts receivable                          (5,368)            --             21            482         (4,865)
            Inventories                                    (331)            --             --             --           (331)
            Prepaids and other assets                      (918)            --             --             --           (918)
            Accounts payable - trade                     (1,075)           296             93           (482)        (1,168)
            Accrued interest                             19,523             --             --             --         19,523
            Accrued expenses                             (7,653)            --              1             --         (7,652)
            Preconfirmation contingencies                  (821)            --             --             --           (821)
            Due to affiliates                            34,084             --              6             --         34,090
            Other current liabilities                       (31)            --             --             --            (31)
                                                   ------------   ------------   ------------   ------------   ------------
                Net cash flows provided by
                   (used in) operating activities       (60,383)            10            (14)            --        (60,387)
                                                   ------------   ------------   ------------   ------------   ------------
Cash Flows From Investing Activities:
     Capital expenditures                                (2,981)            --           (427)            --         (3,408)
     Increase in deferred charges and
        other assets                                     (1,218)            --             --             --         (1,218)
                                                   ------------   ------------   ------------   ------------   ------------
Net cash flows used in investing activities              (4,199)            --           (427)            --         (4,626)
                                                   ------------   ------------   ------------   ------------   ------------
Cash Flows From Financing Activities:
     Net short-term borrowings                            7,400             --             --             --          7,400
     Proceeds from notes payable -
        affiliate                                        49,103             --            449             --         49,552
                                                   ------------   ------------   ------------   ------------   ------------
Net cash flows provided by financing
     activities                                          56,503             --            449             --         56,952
                                                   ------------   ------------   ------------   ------------   ------------
Net increase (decrease) in cash and
     cash equivalents                                    (8,079)            10              8             --         (8,061)
Cash and cash equivalents, beginning
     of period                                           34,681              4              2             --         34,687
                                                   ------------   ------------   ------------   ------------   ------------
Cash and cash equivalents, end of
     period                                        $     26,602   $         14   $         10   $         --   $     26,626
                                                   ============   ============   ============   ============   ============
</Table>



                                       69

<PAGE>
                      JCC HOLDING COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                      FOR THE YEAR ENDED DECEMBER 31, 1999
                                 (IN THOUSANDS)


<Table>
<Caption>

                                                                JAZZ CASINO   JCC HOLDING    GUARANTOR                 CONSOLIDATED
                                                                  COMPANY       COMPANY     SUBSIDIARIES  ELIMINATIONS    TOTAL
                                                                -----------   -----------   ------------  ------------ -----------
<S>                                                             <C>           <C>           <C>           <C>          <C>
Cash Flows From Operating Activities:
     Net Income (Loss)                                          $   (58,714)  $   (59,140)  $        11   $    58,703  $   (59,140)
     Adjustments to reconcile net income (loss) to net
          cash used in operating activities:
          Depreciation and amortization                               5,102            --             5            --        5,107
          Amortization of note discount                                 765            --            --            --          765
          Amortization of unearned compensation                          --           259            --            --          259
          Deferred rent                                                 226            --            --            --          226
          Write-off of preconfirmation contingencies                 (1,562)           --            --            --       (1,562)
          Loss on sale of property and equipment                         27            --            --            --           27
          Equity in Subsidiary losses                                    --        58,703            --       (58,703)          --
     Changes in operation assets and liabilities:
          Accounts receivable                                        (3,134)           --            --            --       (3,134)
          Inventories                                                  (354)           --            --            --         (354)
          Prepaids and other assets                                  (1,062)           --            --            --       (1,062)
          Accounts payable - trade                                      907           462            --            --        1,369
          Accrued interest                                           (5,855)           --            --            --       (5,855)
          Accrued expenses                                           16,616          (280)           --            --       16,336
          Preconfirmation contingencies                              (2,084)           --            --            --       (2,084)
          Due to affiliates                                           8,224            --            --            --        8,224
          Other current liabilities                                   2,009            --            --            --        2,009
                                                                -----------   -----------   -----------   -----------  -----------
             Net cash flows provided by (used in) operating
                 activities                                         (38,889)            4            16            --      (38,869)
                                                                -----------   -----------   -----------   -----------  -----------
Cash Flows From Investing Activities:
     Capital expenditures                                          (129,334)           --        (1,218)           --     (130,552)
     Proceeds from sale of property                                   6,042            --            --            --        6,042
     Increase in deferred charges and other assets                   (8,492)           --            --            --       (8,492)
                                                                -----------   -----------   -----------   -----------  -----------
               Net cash flows used in investing activities         (131,784)           --        (1,218)           --     (133,002)
                                                                -----------   -----------   -----------   -----------  -----------
Cash Flows From Financing Activities:
     Net short-term borrowings                                       15,850            --            --            --       15,850
     Proceeds from notes payable - affiliate                             --            --         1,204            --        1,204
     Proceeds from issuance of long -term debt                      163,998            --            --            --      163,998
                                                                -----------   -----------   -----------   -----------  -----------
               Net cash flows provided by financing activities      179,848            --         1,204            --      181,052
                                                                -----------   -----------   -----------   -----------  -----------
Net increase (decrease) in cash and cash equivalents                  9,175             4             2            --        9,181
Cash and cash equivalents, beginning of period                       25,506            --            --            --       25,506
                                                                -----------   -----------   -----------   -----------  -----------
Cash and cash equivalents, end of period                        $    34,681   $         4   $         2   $        --  $    34,687
                                                                ===========   ===========   ===========   ===========  ===========
</Table>



                                       70

<PAGE>


NOTE 14. QUARTERLY FINANCIAL DATA (UNAUDITED)

Our operating results for the four quarters of 2001, and 2000 were as follows:


<Table>
<Caption>

Fiscal 2001                                         First Quarter   Second Quarter  Third Quarter   Fourth Quarter
                                                    -------------   --------------  -------------   --------------
                                                           (In thousands)

<S>                                                  <C>             <C>             <C>             <C>
Net revenues                                         $     59,011    $     58,056    $     59,899    $     61,681
Operating income (loss)                              $    (17,596)   $       (578)   $        621    $      2,005
Extraordinary gain                                   $    213,448    $         --    $         --    $         --
Loss before extraordinary item                       $   (118,455)   $     (4,033)   $     (1,874)   $      2,700
Net income (loss)                                    $     94,993    $     (4,033)   $     (1,874)   $      2,700
Basic net loss per share before extraordinary item   $      (9.56)   $      (0.33)   $      (0.15)   $       0.22
Basic net income (loss) per share                    $       7.67    $      (0.33)   $      (0.15)   $       0.22
</Table>

<Table>
<Caption>
Fiscal 2000                                          First Quarter   Second Quarter   Third Quarter   Fourth Quarter
                                                     -------------   --------------   -------------   --------------
                                                           (In thousands)

<S>                                                  <C>             <C>              <C>             <C>
Net revenues                                         $      58,194   $       58,820   $      65,225   $       59,875
Operating income (loss)                              $     (24,209)  $      (21,073)  $     (19,616)  $     (280,975)
Net loss                                             $     (34,750)  $      (32,125)  $     (31,355)  $     (255,998)
Basic net (loss) per share                           $       (3.44)  $        (3.16)  $       (3.06)  $       (25.13)
</Table>

The first quarter 2001 included a gain on early extinguishment of debt of $213.4
million and in the fourth quarter preconfirmation contingencies were reduced in
the amount of $1.8 million due to changes in estimates. (see Note 1). The fourth
quarter 2000 included a $255.9 million impairment charge (see Note 3). The
impairment charge recorded in the fourth quarter 2000 created a deferred tax
asset available to offset our deferred tax liability. As of December 31, 2000,
the valuation allowance was increased to reduce our net deferred taxes to zero
resulting in an income tax benefit of $37.9 million (see Note 7).

                                       71
<PAGE>





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

         Not applicable.


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

         Information relating to the directors of the Company will be set forth
under the captions "Proposal 1 -- Election of Directors -- Nominees" and "--
Information Regarding Nominees and Continuing Directors" in the Company's Proxy
Statement for its 2002 Annual Meeting of Stockholders to be held on April 25,
2002 (the "2002 Proxy Statement"). Such information is incorporated herein by
reference. Information relating to the executive officers of the Company is set
forth in Part I, Item 4 of this report under the caption "Executive Officers of
the Registrant." Information regarding compliance with Section 16(a) of the
Securities Exchange Act of 1934 by directors and executive officers of the
Company and beneficial owners of more than 10% of the Company's Common Stock
will be set forth under the caption "Section 16(a) Beneficial Ownership
Reporting Compliance" in the 2002 Proxy Statement. Such information is
incorporated herein by reference. The 2002 Proxy Statement will be filed with
the Securities and Exchange Commission within 120 days after December 31, 2001.

ITEM 11. EXECUTIVE COMPENSATION.

         Information relating to executive compensation will be set forth under
the captions "Proposal 1 -- Election of Directors -- Director Compensation,"
"Executive Compensation" and "Certain Relationships and Related Transactions" in
the 2002 Proxy Statement. Such information is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

         Information regarding ownership of the Company's Common Stock by
certain persons will be set forth under the caption "Stock Ownership" in the
2002 Proxy Statement. Such information is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         Information required by this item regarding certain relationships and
transactions of the Company will be set forth under the caption "Certain
Relationships and Related Transactions" in the 2002 Proxy Statement. Such
information is incorporated herein by reference.

                                     PART IV

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

         (a) 1. Consolidated Financial Statements

         The following consolidated financial statements of JCC Holding Company
and Subsidiaries are set forth in Item 8 hereof:

         Financial Statements of JCC Holding Company and Subsidiaries

                  Independent Auditors' Report

                  Consolidated Balance Sheets as of December 31, 2001 and 2000.




                                       72
<PAGE>

                  Consolidated Statements of Operations for the Years Ended
                  December 31, 2001, 2000 and 1999.

                  Consolidated Statements of Cash Flows for the Years Ended
                  December 31, 2001, 2000 and 1999.

                  Consolidated Statements of Stockholders' Equity (Deficit) for
                  the Years Ended December 31, 2001, 2000 and 1999.

                  Notes to Consolidated Financial Statements.

         2. Financial Statement Schedules

         All schedules to the consolidated financial statements are omitted as
they are not required under the related instructions or are inapplicable, or
because the required information is included in the consolidated financial
statements or related notes thereto.

         3. Exhibits

         The following exhibits either (i) are filed herewith or (ii) have
previously been filed with the Securities and Exchange Commission and are
incorporated herein by reference to such prior filings. Previously filed
registration statements and reports which are incorporated herein by reference
are identified in the column captioned "SEC Document Reference." The Company
will furnish any exhibit upon request to L. Camille Fowler, Vice President --
Finance, Treasurer and Secretary of the Company, One Canal Place, 365 Canal
Street, Suite 900, New Orleans, Louisiana 70130. There is a charge of $.50 per
page to cover expenses of copying and mailing.


                                       73
<PAGE>




<Table>
<Caption>

     EXHIBIT
       NO.                            DESCRIPTION                                 SEC DOCUMENT REFERENCE
       ---                            -----------                                 ----------------------
<S>                 <C>                                              <C>


       2.01         Joint Plan of Reorganization under Chapter 11    Exhibit 2.2 to JCC Holding Company's
                    of the Bankruptcy Code as of February 8, 2001    Current Report on Form 8-K dated March 29,
                                                                     2001

       3.01         Second Amended and Restated Certificate of       Exhibit 3.01 to JCC Holding Company's Annual
                    Incorporation                                    Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       3.02         Third Amended and Restated Bylaws                Exhibit 3.02 to JCC Holding Company's Annual
                                                                     Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       4.01         Indenture by and between Jazz Casino, as         Exhibit 4.01 to JCC Holding Company's Annual
                    Issuer, JCC Holding Company, JCC Canal           Report on Form 10-K/A for the Year Ended
                    Development, L.L.C., JCC Fulton Development,     December 31, 2000
                    L.L.C., and JCC Development Company, L.L.C.,
                    as Guarantors, and Wells Fargo, as Trustee
                    dated as of Effective Date relating to
                    aggregate principal amount of $124,520,000
                    Senior Notes, including attachments

       4.02         Registration Rights Agreement (Common Stock),    Exhibit 4.02 to JCC Holding Company's Annual
                    dated as of March 29, 2001, among JCC Holding    Report on Form 10-K/A for the Year Ended
                    Company, Inc., and each Holder of the New        December 31, 2000
                    Common Stock

       4.03         Registration Rights Agreement (Senior Notes),    Exhibit 4.03 to JCC Holding Company's Annual
                    dated as of March 29, 2001, among Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C., JCC Holding Company, Inc.,      December 31, 2000
                    JCC Canal Development, L.L.C., JCC Fulton
                    Development, L.L.C., and each Holder of the
                    Senior Notes

       4.04         Manager Subordination Agreement (Noteholders)    Exhibit 4.04 to JCC Holding Company's Annual
                                                                     Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       4.05         Intercreditor Agreement, dated as of March 29,   Exhibit 4.05 to JCC Holding Company's Annual
                    2001, among Harrah's Entertainment, Inc., and    Report on Form 10-K/A for the Year Ended
                    Harrah's Operating Company, Inc., as the         December 31, 2000
                    minimum payment guarantors, and, together with
                    Harrah's New Orleans Management Company, Inc.
                    as the revolving lenders, Wells Fargo, as
                    trustee, for the holders from time to time of
                    the Senior Notes, and the Bank of New York,
                    as Collateral Agent

       4.06         Revolving Credit Agreement among Jazz Casino     Exhibit 4.06 to JCC Holding Company's Annual
                    Company, L.L.C., as borrower; JCC Holding        Report on Form 10-K/A for the Year Ended
                    Company, Inc., JCC Canal Development L.L.C.,     December 31, 2000
                    JCC Fulton Development, L.L.C. and JCC
                    Development, L.L.C., as guarantors; and
                    Harrah's Entertainment, Inc., a Delaware
                    corporation, Harrah's Operating Company, Inc.,
                    a Delaware corporation, and Harrah's New
                    Orleans Management Company, a Nevada
                    corporation, as lenders
</Table>



                                       74
<PAGE>

<Table>
<S>                                                                  <C>
       4.07         Pledge Agreement, dated as of March 29, 2001,    Exhibit 4.07 to JCC Holding Company's Annual
                    among Harrah's Entertainment, Inc., and          Report on Form 10-K/A for the Year Ended
                    Harrah's Operating Company, Inc., as the         December 31, 2000
                    minimum payment guarantors, and, together with
                    Harrah's New Orleans Management Company, Inc.
                    as the revolving lenders, Wells Fargo, as
                    trustee, for the holders from time to time of
                    the Senior Notes, and the Bank of New York,
                    as Collateral Agent

       4.08         Security Agreement, dated as of March 29,        Exhibit 4.08 to JCC Holding Company's Annual
                    2001, among JCC Holding Company, Jazz Casino     Report on Form 10-K/A for the Year Ended
                    Company, L.L.C., and certain of their            December 31, 2000
                    subsidiaries, as assignors, Harrah's
                    Entertainment, Inc. and Harrah's Operating
                    Company, Inc., as the minimum payment
                    guarantors, and, together with Harrah's New
                    Orleans Management Company, Inc. as the
                    revolving lenders, Wells Fargo, as trustee,
                    for the holders from time to time of the
                    Senior Notes, and the Bank of New York, as
                    Collateral Agent

      10.01         Amended and Restated Lease Agreement among       1-12095
                    Rivergate Development corporation, as            Exhibit 10.01 to Pre-Effective Amendment No. 2
                    Landlord, and Jazz Casino Company, L.L.C., as    to JCC Holding Company's Registration Statement
                    Tenant, and the City of New Orleans, as          on Form 10
                    Intervenor, dated October 29, 1998

      10.02         First Amendment to Amended and Restated Lease    Exhibit 10.01 to JCC Holding Company's Annual
                    Agreement by and between Rivergate               Report on Form 10-K/A for the Year Ended
                    Development corporation and Jazz Casino          December 31, 2000
                    regarding Canal Street Casino Property dated
                    as of March 29, 2001

      10.03*        Second Amendment to Amended and Restated Lease
                    Agreement by and between Rivergate Development
                    Corporation and Jazz Casino regarding Canal
                    Street Casino Property dated as of February 7,
                    2002

      10.04         Amended and Renegotiated Casino Operating        1-12095
                    Contract among the State of Louisiana by and     Exhibit 10.05 to Pre-Effective Amendment No. 2
                    through the Louisiana Gaming Control Board,      to JCC Holding Company's Registration Statement
                    Harrah's Jazz Company, Jazz Casino Company,      on Form 10
                    L.L.C., and Harrah's New Orleans Management
                    Company and JCC Holding Company, as
                    Intervenors effective as of October 30, 1998

      10.05         Second Amendment to Amended and Renegotiated     Exhibit 10.02 to JCC Holding Company's Annual
                    Casino Operating Contract between Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C. and the State of Louisiana       December 31, 2000

      10.06         Third Amendment to Amended and Renegotiated      Exhibit 10.03 to JCC Holding Company's Annual
                    Casino Operating Contract between Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C. and the State of Louisiana       December 31, 2000
                    dated as of March 29, 2001

      10.07         Third Amended and Restated Management            Exhibit 10.04 to JCC Holding Company's Annual
                    Agreement between Jazz Casino and Harrah's       Report on Form 10-K/A for the Year Ended
                    Management Company dated as of March 29, 2001    December 31, 2000
</Table>



                                       75
<PAGE>
<Table>
<S>                                                                  <C>
      10.08         Amended and Restated HET/JCC Agreement among     Exhibit 10.05 to JCC Holding Company's Annual
                    Jazz Casino Company, L.L.C., Harrah's            Report on Form 10-K/A for the Year Ended
                    Entertainment, Inc., Harrah's Operating          December 31, 2000
                    Company, Inc., and JCC Holding Company, Inc.
                    regarding Minimum Payment Guaranty, dated as
                    of March 29, 2001

      10.09         Second Floor Non-Gaming Sublease Between Jazz    1-12095
                    Casino Company, L.L.C., as Sublessor, and JCC    Exhibit 10.07 to Pre-Effective Amendment No. 2
                    Development Company, L.L.C., as Sublessee,       to JCC Holding Company's Registration Statement
                    dated October 29, 1998                           on Form 10

      10.10*        First Amendment to Second Floor Non-Gaming
                    Sublease Between Jazz Casino Company, L.L.C.,
                    as Sublessor, and JCC Development Company,
                    L.L.C., as Sublessee, dated February 7, 2002

      10.11         Amended and Restated Open Access Plans of Jazz   1-12095
                    Casino Company, L.L.C., submitted to the         Exhibit 10.37 to Pre-Effective Amendment No. 2
                    council of the City of New Orleans on October    to JCC Holding Company's Registration Statement
                    29, 1998                                         on Form 10

      10.12*        First Amendment to Amended and Restated Open
                    Access Plans of Jazz Casino Company, L.L.C.,
                    entered into on February 7, 2002

      10.13         Open Access Program                              1-12095
                                                                     Exhibit 10.38 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 1998

      10.14*        First Amendment to Open Access Program,
                    entered into on February 7, 2002

      10.15         Employment Agreement, dated as of May 6, 1999,   Exhibit 10.40 to JCC Holding Company's
                    by and between JCC Holding Company and           Quarterly Report on Form 10-Q for the Quarter
                    Frederick W. Burfurd                             Ended June 30, 1998

      10.16*        Separation Agreement and General Release,
                    dated as of July 19, 2001, by and between JCC
                    Holding Company and Frederick W. Burford

      10.17         Employment Agreement, dated as of August 25,     Exhibit 10.41 to JCC Holding Company's
                    1999, by and between JCC Holding Company and     Quarterly Report on Form 10-Q for the Quarter
                    L. Camille Fowler                                Ended September 30, 1999

      10.18         Sublease Agreement by and between Jazz Casino    Exhibit 10.13 to JCC Holding Company's Annual
                    Company, L.L.C. and Sullivan Transfer Co.        Report on Form 10-K for the Year Ended December
                                                                     31, 2000

      10.19         Act of Mortgage and Collateral Assignment by     Exhibit 10.13 to JCC Holding Company's Annual
                    Jazz Casino Company, L.L.C.                      Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.20         Act of Mortgage and Collateral Assignment by     Exhibit 10.14 to JCC Holding Company's Annual
                    JCC Canal Development, L.L.C.                    Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.21         Act of Mortgage and Collateral Assignment by     Exhibit 10.15 to JCC Holding Company's Annual
                    JCC Fulton Development, L.L.C.                   Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.22         Act of Mortgage and Collateral Assignment by     Exhibit 10.16 to JCC Holding Company's Annual
                    JCC Development Company                          Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.23         Four Year Unconditional Minimum Payment          Exhibit 10.17 to JCC Holding Company's Annual
                    Guaranty Agreement from Harrah' Entertainment,   Report on Form 10-K/A for the Year Ended
                    Inc. and Harrah's Operating Company, Inc., in    December 31, 2000
                    favor of the State of Louisiana, dated as of
                    March 29, 2001
</Table>



                                       76
<PAGE>
<Table>
<S>                                                                  <C>
      10.24         JCC Holding Company 1998 Long-Term Incentive     1-2095
                    Plan                                             Exhibit 10.20 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 1998

      10.25*        Form of Amendment Number One to the JCC
                    Holding Company 1998 Long-Term Incentive
                    Plan, effective as of May 1, 2000

      10.26*        Form of Amendment Number Two to the JCC
                    Holding Company 1998 Long-Term Incentive
                    Plan, effective as of March 29, 2001

      10.27*        Agreement to Purchase and Sell, dated as of
                    June 15, 2001, by and between JCC Canal
                    Development, L.L.C., a Louisiana limited
                    liability company, and 3CP Associates, L.L.C.,
                    a Louisiana liability company

      21.27         List of subsidiaries of JCC Holding Company      Exhibit 21.01 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 2000

      23.1*         Consent of Deloitte & Touche LLP, Independent
                    Public Accountants, dated March 12, 2002
</Table>

*  Filed herewith

         (b)      Reports on Form 8-K
                  None.


                                       77
<PAGE>




                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, on March 14, 2002.


                                       JCC HOLDING COMPANY

                                       By:        /s/ Paul Debban
                                           -------------------------------------
                                                    Paul Debban
                                                     President

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


<Table>
<Caption>

                     SIGNATURE                                                     TITLE
                     ---------                                                     -----

<S>                                                                    <C>
                 /s/ PAUL DEBBAN                                       President
-----------------------------------------------------                  Director
                   Paul Debban                                         (principal executive officer)
Date: March 14, 2002

                 /s/ PHILIP G. SATRE                                   Director
-----------------------------------------------------
                   Philip G. Satre
Date: March 14, 2002

                 /s/ PRESTON SMART                                     Director
-----------------------------------------------------
                   Preston Smart
Date: March 14, 2002

                                                                       Director
-----------------------------------------------------
                 Anthony Sanfilippo
Date:

                /s/ RUDY J. CERONE                                     Director
-----------------------------------------------------
                  Rudy J. Cerone
Date: March 14, 2002

                /s/ EDDIE N. WILLIAMS                                  Director
-----------------------------------------------------
                  Eddie N. Williams
Date: March 14, 2002

                 /s/ CHRIS LOWDEN                                      Director
-----------------------------------------------------
                   Chris Lowden
Date: March 14, 2002

               /s/ L. CAMILLE FOWLER                                   Vice President -- Finance,
 -----------------------------------------------------                 Treasurer and Secretary
                 L. Camille Fowler                                     (principal financial and accounting officer)
Date: March 14, 2002
</Table>




                                       78
<PAGE>



                                  EXHIBIT INDEX


<Table>
<Caption>

     EXHIBIT
     NUMBER                         DESCRIPTION                                 SEC DOCUMENT REFERENCE
     ------                         -----------                                 ----------------------

<S>                                                                  <C>
       2.01         Joint Plan of Reorganization under Chapter 11    Exhibit 2.2 to JCC Holding Company's
                    of the Bankruptcy Code as of February 8, 2001    Current Report on Form 8-K dated March 29,
                                                                     2001

       3.01         Second Amended and Restated Certificate of       Exhibit 3.01 to JCC Holding Company's Annual
                    Incorporation                                    Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       3.02         Third Amended and Restated Bylaws                Exhibit 3.02 to JCC Holding Company's Annual
                                                                     Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       4.01         Indenture by and between Jazz Casino, as         Exhibit 4.01 to JCC Holding Company's Annual
                    Issuer, JCC Holding Company, JCC Canal           Report on Form 10-K/A for the Year Ended
                    Development, L.L.C., JCC Fulton Development,     December 31, 2000
                    L.L.C., and JCC Development Company, L.L.C.,
                    as Guarantors, and Wells Fargo, as Trustee
                    dated as of Effective Date relating to
                    aggregate principal amount of $124,520,000
                    Senior Notes, including attachments

       4.02         Registration Rights Agreement (Common Stock),    Exhibit 4.02 to JCC Holding Company's Annual
                    dated as of March 29, 2001, among JCC Holding    Report on Form 10-K/A for the Year Ended
                    Company, Inc., and each Holder of the New        December 31, 2000
                    Common Stock

       4.03         Registration Rights Agreement (Senior Notes),    Exhibit 4.03 to JCC Holding Company's Annual
                    dated as of March 29, 2001, among Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C., JCC Holding Company, Inc.,      December 31, 2000
                    JCC Canal Development, L.L.C., JCC Fulton
                    Development, L.L.C., and each Holder of the
                    Senior Notes

       4.04         Manager Subordination Agreement (Noteholders)    Exhibit 4.04 to JCC Holding Company's Annual
                                                                     Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

       4.05         Intercreditor Agreement, dated as of March 29,   Exhibit 4.05 to JCC Holding Company's Annual
                    2001, among Harrah's Entertainment, Inc., and    Report on Form 10-K/A for the Year Ended
                    Harrah's Operating Company, Inc., as the         December 31, 2000
                    minimum payment guarantors, and, together
                    with Harrah's New Orleans Management Company,
                    Inc. as the revolving lenders, Wells Fargo,
                    as trustee, for the holders from time to time
                    of the Senior Notes, and the Bank of New
                    York, as Collateral Agent

       4.06         Revolving Credit Agreement among Jazz Casino     Exhibit 4.06 to JCC Holding Company's Annual
                    Company, L.L.C., as borrower; JCC Holding        Report on Form 10-K/A for the Year Ended
                    Company, Inc., JCC Canal Development L.L.C.,     December 31, 2000
                    JCC Fulton Development, L.L.C. and JCC
                    Development, L.L.C., as guarantors; and
                    Harrah's Entertainment, Inc., a Delaware
                    corporation, Harrah's Operating Company, Inc.,
                    a Delaware corporation, and Harrah's New
</Table>



                                       79
<PAGE>
<Table>
<S>                                                                  <C>

                    Orleans Management Company, a Nevada
                    corporation, as lenders

       4.07         Pledge Agreement, dated as of March 29, 2001,    Exhibit 4.07 to JCC Holding Company's Annual
                    among Harrah's Entertainment, Inc., and          Report on Form 10-K/A for the Year Ended
                    Harrah's Operating Company, Inc., as the         December 31, 2000
                    minimum payment guarantors, and, together with
                    Harrah's New Orleans Management Company, Inc.
                    as the revolving lenders, Wells Fargo, as
                    trustee, for the holders from time to time of
                    the Senior Notes, and the Bank of New York,
                    as Collateral Agent

       4.08         Security Agreement, dated as of March 29,        Exhibit 4.08 to JCC Holding Company's Annual
                    2001, among JCC Holding Company, Jazz Casino     Report on Form 10-K/A for the Year Ended
                    Company, L.L.C., and certain of their            December 31, 2000
                    subsidiaries, as assignors, Harrah's
                    Entertainment, Inc. and Harrah's Operating
                    Company, Inc., as the minimum payment
                    guarantors, and, together with Harrah's New
                    Orleans Management Company, Inc. as the
                    revolving lenders, Wells Fargo, as trustee,
                    for the holders from time to time of the
                    Senior Notes, and the Bank of New York, as
                    Collateral Agent

      10.01         Amended and Restated Lease Agreement among       1-12095
                    Rivergate Development Corporation, as            Exhibit 10.01 to Pre-Effective Amendment No. 2
                    Landlord, and Jazz Casino Company, L.L.C., as    to JCC Holding Company's Registration Statement
                    Tenant, and the City of New Orleans, as          on Form 10
                    Intervenor, dated October 29, 1998

      10.02         First Amendment to Amended and Restated Lease    Exhibit 10.01 to JCC Holding Company's Annual
                    Agreement by and between Rivergate               Report on Form 10-K/A for the Year Ended
                    Development Corporation and Jazz Casino          December 31, 2000
                    regarding Canal Street Casino Property dated
                    as of March 29, 2001

      10.03*        Second Amendment to Amended and Restated Lease
                    Agreement by and between Rivergate Development
                    Corporation and Jazz Casino Canal Street
                    Casino Property dated as of February 7, 2002

      10.04         Amended and Renegotiated Casino Operating        1-12095
                    Contract among the State of Louisiana by and     Exhibit 10.05 to Pre-Effective Amendment No. 2
                    through the Louisiana Gaming Control Board,      to JCC Holding Company's Registration Statement
                    Harrah's Jazz Company, Jazz Casino Company,      on Form 10
                    L.L.C., and Harrah's New Orleans Management
                    Company and JCC Holding Company, as
                    Intervenors effective as of October 30, 1998

      10.05         Second Amendment to Amended and Renegotiated     Exhibit 10.02 to JCC Holding Company's Annual
                    Casino Operating Contract between Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C. and the State of Louisiana       December 31, 2000

      10.06         Third Amendment to Amended and Renegotiated      Exhibit 10.03 to JCC Holding Company's Annual
                    Casino Operating Contract between Jazz Casino    Report on Form 10-K/A for the Year Ended
                    Company, L.L.C. and the State of Louisiana       December 31, 2000
                    dated as of March 29, 2001
</Table>



                                       80
<PAGE>
<Table>
<S>                                                                  <C>
      10.07         Third Amended and Restated Management            Exhibit 10.04 to JCC Holding Company's Annual
                    Agreement between Jazz Casino and Harrah's       Report on Form 10-K/A for the Year Ended
                    Management Company dated as of March 29, 2001    December 31, 2000

      10.08         Amended and Restated HET/JCC Agreement among     Exhibit 10.05 to JCC Holding Company's Annual
                    Jazz Casino Company, L.L.C., Harrah's            Report on Form 10-K/A for the Year Ended
                    Entertainment, Inc., Harrah's Operating          December 31, 2000
                    Company, Inc., and JCC Holding Company, Inc.
                    regarding Minimum Payment Guaranty, dated as
                    of March 29, 2001

      10.09         Second Floor Non-Gaming Sublease Between Jazz    1-12095
                    Casino Company, L.L.C., as Sublessor, and JCC    Exhibit 10.07 to Pre-Effective Amendment No. 2
                    Development Company, L.L.C., as Sublessee,       to JCC Holding Company's Registration Statement
                    dated October 29, 1998                           on Form 10

      10.10*        First Amendment to Second Floor Non-Gaming
                    Sublease Between Jazz Casino Company, L.L.C.,
                    as Sublessor, and JCC Development Company,
                    L.L.C., as Sublessee, dated February 7, 2002

      10.11         Amended and Restated Open Access Plans of Jazz   1-12095
                    Casino Company, L.L.C., submitted to the         Exhibit 10.37 to Pre-Effective Amendment No. 2
                    council of the City of New Orleans on October    to JCC Holding Company's Registration Statement
                    29, 1998                                         on Form 10

      10.12*        First Amendment to Amended and Restated Open
                    Access Plans of Jazz Casino Company, L.L.C.,
                    entered into on February 7, 2002

      10.13         Open Access Program                              1-12095
                                                                     Exhibit 10.38 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 1998
      10.14*        First Amendment to Open Access Program,
                    entered into on February 7, 2002

      10.15         Employment Agreement, dated as of May 6, 1999,   Exhibit 10.40 to JCC Holding Company's
                    by and between JCC Holding Company and           Quarterly Report on Form 10-Q for the Quarter
                    Frederick W. Burfurd                             Ended June 30, 1998

      10.16*        Separation Agreement and General Release,
                    dated as of July 19, 2001, by and between JCC
                    Holding Company and Frederick W. Burford

      10.17         Employment Agreement, dated as of August 25,     Exhibit 10.41 to JCC Holding Company's
                    1999, by and between JCC Holding Company and     Quarterly Report on Form 10-Q for the Quarter
                    L. Camille Fowler                                Ended September 30, 1999

      10.18         Sublease Agreement by and between Jazz Casino    Exhibit 10.13 to JCC Holding Company's Annual
                    Company, L.L.C. and Sullivan Transfer Co.        Report on Form 10-K for the Year Ended December
                                                                     31, 2000

      10.19         Act of Mortgage and Collateral Assignment by     Exhibit 10.13 to JCC Holding Company's Annual
                    Jazz Casino Company, L.L.C.                      Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.20         Act of Mortgage and Collateral Assignment by     Exhibit 10.14 to JCC Holding Company's Annual
                    JCC Canal Development, L.L.C.                    Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.21         Act of Mortgage and Collateral Assignment by     Exhibit 10.15 to JCC Holding Company's Annual
                    JCC Fulton Development, L.L.C.                   Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000

      10.22         Act of Mortgage and Collateral Assignment by     Exhibit 10.16 to JCC Holding Company's Annual
                    JCC Development Company                          Report on Form 10-K/A for the Year Ended
                                                                     December 31, 2000
</Table>



                                       81
<PAGE>
<Table>
<S>                                                                  <C>
      10.23         Four Year Unconditional Minimum Payment          Exhibit 10.17 to JCC Holding Company's Annual
                    Guaranty Agreement from Harrah' Entertainment,   Report on Form 10-K/A for the Year Ended
                    Inc. and Harrah's Operating Company, Inc., in    December 31, 2000
                    favor of the State of Louisiana, dated as of
                    March 29, 2001

      10.24         JCC Holding Company 1998 Long-Term Incentive     1-2095
                    Plan                                             Exhibit 10.20 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 1998

      10.25*        Form of Amendment Number One to the JCC
                    Holding Company 1998 Long-Term Incentive
                    Plan, effective as of May 1, 2000

      10.26*        Form of Amendment Number Two to the JCC
                    Holding Company 1998 Long-Term Incentive
                    Plan, effective as of March 29, 2001

      10.27*        Agreement to Purchase and Sell, dated as of
                    June 15, 2001, by and between JCC Canal
                    Development, L.L.C., a Louisiana limited
                    liability company, and 3CP Associates, L.L.C.,
                    a Louisiana liability company

      21.25         List of subsidiaries of JCC Holding Company      Exhibit 21.01 to JCC Holding Company's Annual
                                                                     Report on Form 10-K for the Year Ended December
                                                                     31, 2000

      23.1*         Consent of Deloitte & Touche LLP, Independent
                    Public Accountants, dated March 12, 2002
</Table>


*  Filed herewith


                                       82