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Place bread slices in single layer in 13x9-inch baking dish, overlapping as necessary. Place a slice of ham between each slice of bread.
Beat eggs in large bowl with wire whisk. Add milk, 1 cup of the cheese, garlic powder, nutmeg and salt; mix well. Gradually pour into baking dish. Sprinkle with remaining 1 cup cheese. Cover with plastic wrap. Refrigerate 1 to 4 hours.
Preheat oven to 350°F. Bake 45 to 55 minutes or until golden brown. Let stand 5 minutes before serving. Sprinkle top with sugar. Serve with raspberry jam or maple syrup, if desired.