<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No.__)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only (as permitted by Rule
14a-6(e)(2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
. . . . . . . . . . .HOMEFED CORPORATION . . . . . . . . . . .
(Name of Registrant as Specified In Its Charter)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction
applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
2) Aggregate number of securities to which transaction applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
4) Proposed maximum aggregate value of transaction:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
5) Total fee paid:
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
. . . . . . . . . . . . . . . . . . . . .
3) Filing Party:
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<PAGE>
HOMEFED CORPORATION
529 East South Temple
Salt Lake City, Utah 84102
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 18, 1998
April 7, 1998
To Our Common Stockholders:
You are cordially invited to attend the Annual Meeting of
Stockholders (the "Meeting") of HomeFed Corporation, a Delaware
Corporation (the "Company"), to be held on Monday, May 18, 1998, at 10:00
a.m., local time, at the offices of Van Cott, Bagley, Cornwall & McCarthy,
50 South Main Street, Suite 1600, Salt Lake City, Utah for the following
purposes:
1. To elect three directors.
2. To ratify the selection of Coopers & Lybrand L.L.P. as
independent auditors to audit the Consolidated Financial Statements of the
Company and its subsidiaries for the year ended December 31, 1998.
3. To transact such other business as may properly come
before the Meeting or any adjournments of the Meeting.
Only holders of record of the Company's common stock, par
value $.01 per share, at the close of business on March 30, 1998 will be
entitled to notice of and to vote at the Meeting. Please sign, date and
mail the enclosed proxy so that your shares may be represented at the
Meeting if you are unable to attend and vote in person.
By order of the Board of Directors.
CORINNE A. MAKI
Secretary
<PAGE>
HOMEFED CORPORATION
529 East South Temple
Salt Lake City, Utah 84102
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 18, 1998
INTRODUCTION
This Proxy Statement is being furnished to the Stockholders
(the "Stockholders") of HomeFed Corporation, a Delaware corporation (the
"Company"), in connection with the solicitation of proxies by the Board of
Directors for use at the Annual Meeting of Stockholders of the Company
(the "Meeting") to be held on May 18, 1998 and at any adjournments
thereof.
At the Meeting, Stockholders will be asked:
(1) To elect three directors.
(2) To ratify the selection of Coopers & Lybrand L.L.P. as
independent auditors to audit the Consolidated Financial Statements of the
Company for the year ended December 31, 1998.
(3) To transact such other business as may properly come
before the Meeting or any adjournments of the Meeting.
The Board of Directors has fixed the close of business on
March 30, 1998 as the record date for the determination of the holders of
common stock, par value $.01 per share (the "Common Shares") entitled to
notice of and to vote at the Meeting. Each such Stockholder will be
entitled to one vote for each Common Share held on all matters to come
before the Meeting and may vote in person or by proxy authorized in
writing. At the close of business on March 30, 1998, there were
10,000,000 Common Shares entitled to vote, including Common Shares that
may be issued to holders that had not exchanged their certificates
evidencing shares of the Company's old common stock as of such date.
This Proxy Statement and the accompanying form of proxy are
first being sent to holders of the Common Shares on or about April 7,
1998.
THE MEETING
Date, Time and Place
The Meeting will be held on May 18, 1998, at 10:00 a.m., local
time, at the offices of Van Cott, Bagley, Cornwall & McCarthy, 50 South
Main Street, Suite 1600, Salt Lake City, Utah.
<PAGE>
Matters to be Considered
At the Meeting, Stockholders will be asked to consider and
vote to elect three directors and to ratify the selection of independent
auditors. See "ELECTION OF DIRECTORS" and "RATIFICATION OF SELECTION OF
INDEPENDENT AUDITORS". The Board of Directors knows of no matters that
are to be brought before the Meeting other than as set forth in the Notice
of Meeting. If any other matters properly come before the Meeting, the
persons named in the enclosed form of proxy or their substitutes will vote
in accordance with their best judgment on such matters.
Record Date; Shares Outstanding and Entitled to Vote
Stockholders as of the Record Date (i.e., the close of
business on March 30, 1998) are entitled to notice of and to vote at the
Meeting. As of the Record Date, there were 10,000,000 Common Shares
outstanding and entitled to vote, including Common Shares that may be
issued to holders that had not exchanged their certificates evidencing
shares of the Company's old common stock as of the Record Date. Each
Common Share is entitled to one vote.
Required Votes
Election of Directors. Under Delaware law, the affirmative
vote of the holders of a plurality of the Common Shares voted at the
Meeting is required to elect each director. Consequently, only shares that
are voted in favor of a particular nominee will be counted toward such
nominee's achievement of a plurality. Shares present at the Meeting that
are not voted for a particular nominee or shares present by proxy where
the Stockholder properly withheld authority to vote for such nominee
(including broker non-votes) will not be counted toward such nominee's
achievement of a plurality.
Ratification of Selection of Independent Auditors. The
ratification of the selection of Coopers & Lybrand L.L.P. as independent
auditors is being submitted to Stockholders because the Board of Directors
believes that such action follows sound corporate practice and is in the
best interests of the Stockholders. If the Stockholders do not ratify the
selection by the affirmative vote of the holders of a majority of the
Common Shares voted at the Meeting, the selection of independent auditors
will be reconsidered by the Board. If the Stockholders ratify the
selection, the Board, in its discretion, may still direct the appointment
of new independent auditors at any time during the year if the Board
believes that such a change would be in the interests of the Company and
its Stockholders. Abstentions and broker non-votes are not counted in
determining the votes cast in connection with the ratification of
auditors, but do have the effect of reducing the number of affirmative
votes required to achieve a majority for such matter by reducing the total
number of shares from which the majority is calculated.
Principal Stockholder. The Company has been advised by its
principal Stockholder, Leucadia Financial Corporation ("LFC"), that LFC
intends to vote the 4,117,986 Common Shares which it owns, representing
approximately 41.2% of the Company's outstanding Common Shares, FOR the
election of the three persons nominated by the Board of Directors to serve
as directors, and FOR the ratification of the selection of Coopers &
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Lybrand L.L.P. as the Company's independent auditors to audit the accounts
of the Company and its subsidiaries for 1998.
Voting and Revocation of Proxies
Stockholders are requested to complete, date, sign and
promptly return the accompanying form of proxy in the enclosed envelope.
Common Shares represented by properly executed proxies received by the
Company and not revoked will be voted at the Meeting in accordance with
the instructions contained therein. If instructions are not given,
proxies will be voted FOR election of each nominee for director named
herein and FOR ratification of selection of independent auditors.
Any proxy signed and returned by a Stockholder may be revoked
at any time before it is voted by filing with the Secretary of the
Company, at the address of the Company set forth herein, written notice of
such revocation or a duly executed proxy bearing a later date or by
attending the Meeting and voting in person. Attendance at the Meeting
will not in and of itself constitute revocation of a proxy.
Proxy Solicitation
The Company will bear the costs of solicitation of proxies for
the Meeting. In addition to solicitation by mail, directors, officers and
regular employees of the Company may solicit proxies from Stockholders by
telephone, telegram, personal interview or otherwise. Such directors,
officers and employees will not receive additional compensation but may be
reimbursed for out-of-pocket expenses in connection with such
solicitation. Brokers, nominees, fiduciaries and other custodians have
been requested to forward soliciting material to the beneficial owners of
Common Shares held of record by them, and such custodians will be
reimbursed for their reasonable expenses.
Independent Auditors
The Company has been advised that representatives of Coopers
& Lybrand L.L.P., the Company's independent auditors for 1997, will attend
the Meeting, will have an opportunity to make a statement if they desire
to do so and will be available to respond to appropriate questions.
ELECTION OF DIRECTORS
At the Meeting, three directors are to be elected to serve
until the next Meeting or until their successors are elected and
qualified. The persons named in the enclosed form of proxy have advised
that, unless contrary instructions are received, they intend to vote FOR
the three nominees named by the Board of Directors and listed on the
following table. The Board of Directors does not expect that any of the
nominees will be unavailable for election as a director. However, if by
reason of an unexpected occurrence one or more of the nominees is not
available for election, the persons named in the form of proxy have
advised that they will vote for such substitute nominees as the Board of
Directors of the Company may propose. The following information is as of
March 30, 1998.
3
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Age, period served as director, other
Name and present position, if any, business experience during the last five
with the Company years and family relationships, if any
- --------------------------------------------------------------------------------
Timothy Considine, Mr. Considine, 57, has served as a
Chairman of the Board director and Chairman of the Board of the
Company since January 1992. Mr. Considine
has been Managing Partner of Considine and
Considine, an accounting firm in San
Diego, California, since 1966.
Michael A. Lobatz Mr. Lobatz, 48, has served as a director
of the Company since February 1995. Mr.
Lobatz has been a director of Diagnostic
Imaging Corp. since 1994. He has been a
practicing physician in San Diego,
California since 1981.
Patricia A. Wood Ms. Wood, 33, has served as a director of
the Company since February 1995. Ms. Wood
has also served as President of the
Company since February 1995 and as
President of the Company's subsidiaries,
HomeFed Communities, Inc. and HomeFed
Resources Corporation, since August 1994.
Ms. Wood also served as Executive Vice
President of the Company from April 1993
to July 1994 and as Chief Financial
Officer from October 1992 to April 1993.
From September 1989 to October 1992, Ms.
Wood was the Assistant Controller for
Douglas Allred Co., a real estate
development company. Ms. Wood is also
President of LFC. See "Certain
Relationships and Related Transactions".
The Board of Directors recommends a vote FOR the above named nominees.
INFORMATION CONCERNING
THE BOARD OF DIRECTORS
Meetings and Committees
During 1997, the Board of Directors held four meetings. The
Board of Directors has no committees. All directors attended all of the
meetings in 1997.
4
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PRESENT BENEFICIAL OWNERSHIP OF COMMON SHARES
Set forth below is certain information as of March 30, 1998
with respect to the beneficial ownership of Common Shares by (i) each
person who, to the knowledge of the Company, is the beneficial owner of
more than 5% of the outstanding Common Shares (the Company's only class of
voting securities), (ii) each director and nominee for director, (iii)
executive officers and (iv) all directors and executive officers as a
group.
Name and Address Amount and Nature of Percent of
of Beneficial Owner Beneficial Ownership (1) Class
- --------------------- ------------------------- ----------
Leucadia Financial Corporation (2) 4,117,986 41.18%
529 East South Temple
Salt Lake City, Utah 84102
Timothy Considine (3) 4,859 .05%
Michael A. Lobatz --- ---
Patricia A. Wood --- ---
Corinne A. Maki --- ---
All directors and
executive officers as a
group (4 persons) 4,859 .05%
______________________
(1) Except as otherwise noted, each of the beneficial owners listed in the
above table has, to the knowledge of the Company, sole voting and
investment power with respect to the indicated Common Shares.
(2) All of the issued and outstanding shares of common stock of LFC are
owned by American Investment Company, a wholly-owned subsidiary of
Leucadia National Corporation. In addition to the Common Shares set
forth above, LFC is the holder of a convertible note which, subject to
certain conditions, may be exchanged for up to a maximum of 54,400,000
Common Shares on or after July 6, 1998.
(3) Includes 4,859 shares held by the Considine and Considine Retirement
Plan. Mr. Considine is the Managing Partner of Considine and Considine,
an accounting firm in San Diego, California.
5
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EXECUTIVE COMPENSATION
Set forth below is certain information with respect to the cash
compensation paid by the Company to its Chief Executive Officer for
services in all capacities to the Company and its subsidiaries during the
years ended 1997, 1996 and 1995. No other officer or employee of the
Company received a total annual salary and bonus in excess of $100,000
during these periods.
Summary Compensation Table
Annual Compensation
- --------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (i)
Other Annual All Other
Name and Compen- Compen-
Principal Position Year Salary Bonus sation sation
($) ($) ($) ($)
- --------------------------------------------------------------------------------
Patricia A. Wood, 1997 26,000 (1) 780 (1) (1) (1)
President ----
1996 24,000 (1) 780 (1) (1) (1)
----
1995 4,558 (1)(2) (1) (1) (1)
----
________________________
(1) The Company pays an annual fee to LFC for performing certain
administrative services for the Company. Ms. Wood is the President of LFC and
also receives compensation from LFC. See "Certain Relationships and Related
Transactions."
(2) Ms. Wood also received directors fees of $12,000 for 1995.
Report on Executive Compensation
The Board of Directors does not have a compensation committee and the Board
of Directors as a whole determines the compensation to be paid to the executive
officers of the Company. The Board of Directors considers a number of factors
in establishing compensation for executive officers, including whether such
executive officers receive compensation from any company engaged by the Company
to perform administrative services for the Company. All of the executive
officers of the Company are officers of LFC, the principal Stockholder of the
Company, which performs administrative services for the Company. Accordingly,
the Board of Directors determined that no compensation should be paid to such
executive officers during 1997, except for the amount of $26,780 which was paid
to Ms. Wood. In addition, because the Company recently emerged from bankruptcy,
the Board of Directors did not consider corporate performance in its
determination of executive compensation. In determining Ms. Wood's
6
<PAGE>
compensation, the Board of Directors considered her responsibilities as an
officer and director of the Company and the services she rendered to the
Company.
The foregoing report is submitted by Timothy Considine, Michael A. Lobatz
and Patricia A. Wood.
Corporate Performance
The following graph compares the performance (total return on investment
as measured by the change in the year-end stock price plus reinvested dividends)
of $100 invested in the Common Shares of the Company with that of $100 invested
in the S&P 500 Index and $100 invested in the S&P Homebuilding Index for the
period from July 27, 1995 to December 31, 1997. Index data was furnished by
Standard & Poor's Compustat Services, Inc. From October 1992 to July 1995, the
Company was in bankruptcy and no information is available concerning the market
price of the Common Shares during such period. Accordingly, no performance
comparison is presented for any period prior to July 1995.
[GRAPHIC MATERIAL OMITTED: THE COMPANY'S SHAREHOLDER RETURN
PERFORMANCE GRAPH IS DESCRIBED IN TABULAR DATA FORM BELOW]
Value at Year End
Value at ------------------------------------
7/27/95 1995 1996 1997
-------- -------- -------- --------
The Company $ 100.00 $ 200.00 $ 100.00 $ 50.00
Homebuilding 500 Index 100.00 119.32 108.81 174.10
S&P 500 Index 100.00 110.15 135.44 180.63
Compensation of Directors
During 1997, Mr. Considine received $12,000 for his services as a
director and Chairman of the Board. Mr. Lobatz received $12,000 for his
services as a director during 1997. Ms. Wood received compensation for
her services as President of the Company and did not receive any
additional compensation for her services as a director during 1997.
7
<PAGE>
Certain Relationships and Related Transactions
Pursuant to an Administrative Services Agreement dated March 1, 1996
(the "Administrative Services Agreement"), LFC agreed to provide
administrative services to the Company for an annual fee of $141,000,
payable in monthly installments, through March 1, 1997. After March 1,
1997, the Administrative Services Agreement provides that LFC and the
Company will negotiate in good faith to determine the compensation to be
paid to LFC under the Administrative Services Agreement for subsequent
periods. The Company and LFC have agreed that the fee to be paid to LFC
for the one-year periods beginning March 1, 1997 and 1998 will be $68,274
and $56,101, respectively. Although this fee is lower than the fee paid in
the initial year, the Company now pays certain expenses previously paid by
LFC. The Administrative Services Agreement will terminate on March 1,
1999; provided, however, that LFC may terminate the Administrative
Services Agreement prior to March 1, 1999, upon 30 days written notice, if
the Company and LFC are unable to reach an agreement regarding the
compensation to be paid to LFC for any period. Administrative fees paid to
LFC for the year ended December 31, 1997 totaled $80,000.
Both of the officers of the Company are officers of LFC and receive
compensation from LFC or Leucadia National Corporation. The Company's
executive offices are located at 529 East South Temple in Salt Lake City,
Utah in an office building occupied and leased by LFC. LFC provides such
office space to the Company in connection with the administrative services
provided to the Company by LFC.
On July 3, 1995, the Company emerged from Chapter 11 Bankruptcy
protection pursuant to its court approved plan of reorganization (the
"Plan"). The Plan was principally funded by the issuance of a $20,000,000
convertible note (the "Convertible Note") to LFC and the sale to LFC of
2,700,000 newly issued $.01 par value Common Shares of the Company for
$810,000. LFC used internal funds for such loan and purchase. LFC is an
indirect wholly-owned subsidiary of Leucadia National Corporation, which
is a diversified financial services holding company principally engaged in
personal and commercial lines of property and casualty insurance, life and
health insurance, banking and lending and manufacturing. As a result of
shares received as a general unsecured creditor and shares purchased as
described above, LFC owns 4,117,986, or approximately 41.2% of the
Company's Common Shares, without giving effect to the Common Shares that
LFC may acquire in the future pursuant to the terms of the Convertible
Note.
The Convertible Note bears interest at the rate of 12% per annum
payable quarterly; however, interest is only paid if the Company has
sufficient funds available, as determined pursuant to the provisions of
the loan agreement relating to the Convertible Note. Unpaid interest is
added to the principal balance each quarter. The Convertible Note matures
on July 3, 2003, and no principal payments are due until September 1998.
Commencing July 6, 1998, the Convertible Note, including any accrued
interest previously added to the principal balance, may be exchanged for
up to a maximum of 54,400,000 Common Shares, at a conversion price of $.45
per share. However, the conversion right is restricted if such conversion
would limit the Company's ability to utilize certain tax benefits. The
Convertible Note is collateralized by all of the Company's assets and has
been guarantied by each of the Company's subsidiaries. The guaranties of
the Company's subsidiaries are collateralized by all of the assets of such
subsidiaries.
8
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LFC has agreed to provide up to an aggregate of $15,000,000 of
construction financing to certain of the Company's subsidiaries and their
affiliates for as long as the Convertible Note is outstanding. The
construction financing is collateralized by certain assets of the
Company's subsidiaries or their affiliates. The construction financing
bears interest based on the prime rate, and any unpaid interest is added
to the principal balance at the end of each month. Payments of principal
and interest on the loans are payable on demand, and if payments are not
made upon demand, the applicable interest rate is increased by 3% per
annum. As of March 31, 1998, no amounts were outstanding under the
construction financing.
On February 27, 1998, the Company purchased 19 lots at the Silverwood
project, one of the Company's real estate development projects, from LFC
for a purchase price of $500,000. The lots were appraised at $600,000 by
an independent appraiser; however, the President of the Company, who is
also an officer of LFC, determined that a purchase price of $500,000 more
accurately reflected the value of the lots based upon her experience with
the project and her analysis of the assumptions made by the appraiser.
Section 16(a) Beneficial Ownership Reporting Compliance
Based solely upon a review of Forms 3 and 4 and amendments
thereto furnished to the Company during its most recent fiscal year and
Form 5 and amendments thereto furnished to the Company with respect to its
most recent fiscal year, and written representations furnished to the
Company, the Company believes that during the year ended December 31,
1997, all persons subject to the reporting requirements of Section 16(a)
of the Exchange Act filed the required reports on a timely basis.
RATIFICATION OF SELECTION
OF INDEPENDENT AUDITORS
The Board of Directors recommends that the Stockholders ratify the
selection of Coopers & Lybrand L.L.P., certified public accountants, as
independent auditors to audit the accounts of the Company and its
subsidiaries for 1998. Coopers & Lybrand L.L.P. are currently independent
auditors for the Company.
The Board of Directors recommends a vote FOR this proposal.
ANNUAL REPORT
A copy of the Company's Annual Report on Form 10-K to Stockholders
is being furnished to Stockholders concurrently herewith. Exhibits to the
Annual Report on Form 10-K will be furnished to Stockholders upon payment
of photocopying charges.
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PROPOSALS BY STOCKHOLDERS
Proposals that Stockholders wish to include in the Company's Proxy
Statement and form of proxy for presentation at the Company's 1999 Annual
Meeting of Stockholders must be received by the Company at 529 East South
Temple, Salt Lake City, Utah 84102, Attention Corinne A. Maki, Secretary,
no later than December 8, 1998.
By Order of the Board of Directors
Corinne A. Maki
Secretary
April 7, 1998
10
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PROXY
HOMEFED CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Patricia A. Wood and Corinne
A. Maki, and each of them, as Proxies, with full power of substitution,
and hereby authorizes them to represent and vote, as designated below, all
shares of Common Stock of the Company held of record by the undersigned on
March 30, 1998 at the Annual Meeting of Stockholders to be held at the
offices of Van Cott, Bagley, Cornwall & McCarthy, 50 South Main Street,
Suite 1600, Salt Lake City, Utah on May 18, 1998 at 10:00 a.m. (local
time), or any adjournment thereof.
(Continued and to be marked, dated and signed on other side.)
FOR all nominees WITHHOLD authority Nominees: Timothy Considine
listed to the to vote for all Michael A. Lobatz
right (except as nominees listed to Patricia A. Wood
indicated to the the right
contrary below)
1. Proposal
to elect
three Common
Directors: _____ _____
INSTRUCTION: To withhold authority to vote for any individual
nominee, write such nominee's name in the space provided below.
__________________________________________________
FOR AGAINST ABSTAIN
2. Proposal to ratify the selection of
Coopers & Lybrand L.L.P. as the
independent auditors for the
Company for the fiscal year ending
December 31, 1998. ____ ____ ____
3. In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the Annual Meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.
Please sign and date this Proxy where shown below and return it promptly.
No postage is required if this proxy is returned in the enclosed envelope
and mailed in the United States.
Signed: ____________________________ Signed: ___________________________
Date: _____________, 1998
Note: (Please sign above exactly as the shares are registered. When
shares are held by joint tenants, both should sign. When signing as
attorney, as executor, administrator, trustee or guardian, please give
full title as such. If a corporation, please sign in full corporate name
by president or other authorized officer. If a partnership, please sign
in partnership name by authorized person.)
