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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K/A
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AMENDMENT NO. 1
[x] AMENDMENT TO ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934. For the fiscal year ended December 31,
1999
or
[_] AMENDMENT TO TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934. For the transition period from
___________ to ___________
Commission file number: 1-5721
HOMEFED CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
DELAWARE 33-0304982
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(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization)
1903 WRIGHT PLACE
SUITE 220
CARLSBAD, CALIFORNIA 92008
(760) 918-8200
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(Address, Including Zip Code, and Telephone Number, Including Area
Code, of Registrant's Principal Executive Offices)
Securities registered pursuant to Section 12(b) of the Act:
NONE
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $.01 PER SHARE
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 registrant's knowledge, in definitive proxy or information statement
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [x]
Based on the average bid and asked prices of the Registrant's Common Stock as
published by the OTC Bulletin Board Service as of April 17, 2000, the aggregate
market value of the Registrant's Common Stock held by non-affiliates was
approximately $23,594,000 on that date.
As of April 17, 2000, there were 56,807,826 outstanding shares of the
Registrant's Common Stock, par value $.01 per share.
DOCUMENTS INCORPORATED BY REFERENCE:
NONE
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<PAGE>
EXPLANATORY NOTE
This Report on Form 10-K/A adds Part III to the Annual Report on Form
10-K of HomeFed Corporation (the "Company") for the fiscal year ended December
31, 1999.
PART III
Item 10. Directors and Executive Officers of the Registrant.
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As of April 17, 2000, the directors and executive officers of the
Company, their ages, the positions held by them and the periods during which
they have served in such positions are as follows:
<TABLE>
<CAPTION>
Name Age Position with HomeFed Office Held Since
---- --- --------------------- -----------------
<S> <C> <C> <C>
Paul J. Borden 51 President and Director 1998
Corinne A. Maki 43 Secretary and Treasurer 1995
Curt R. Noland 43 Vice President 1998
Patrick D. Bienvenue 45 Director 1998
Timothy M. Considine 59 Director 1992
Ian M. Cumming 59 Director 1999
Michael A. Lobatz 51 Director 1995
Joseph S. Steinberg 56 Chairman of the Board and Director 1998
</TABLE>
The officers serve at the pleasure of the board of directors of the
Company.
The recent business experience of our executive officers and
directors is summarized as follows:
Paul J. Borden. Mr. Borden has served as a director and President of
HomeFed since May 1998. Mr. Borden has been a Vice President of Leucadia
National Corporation, a diversified financial services holding company
("Leucadia"), since August 1988, responsible for overseeing many of Leucadia's
real estate investments. For information concerning the administrative services
agreement pursuant to which the services of Mr. Borden and Ms. Maki are provided
to the Company, see "Administrative Services Agreement" referred to in Item 13.
"Certain Relationships and Related Transactions."
Corinne A. Maki. Ms. Maki, a certified public accountant, has served
as Treasurer of the Company since February 1995 and Secretary since February
1998. Prior to that, Ms. Maki served as an Assistant Secretary of the Company
since August 1995. Ms. Maki has also been a Vice President of Leucadia Financial
Corporation, a subsidiary of Leucadia ("Leucadia Financial"), holding the
offices of Controller, Assistant Secretary and Treasurer since October 1992. Ms.
Maki has been employed by Leucadia since December 1991.
Curt R. Noland. Mr. Noland has served as Vice President of the
Company since October 1998. He spent the last 19 years in the land development
industry in San Diego County as a design consultant, merchant builder and a
master developer. From November 1997 until immediately prior to joining the
Company, Mr. Noland was employed by the prior development manager of San Elijo
Hills and served as Director of Development for San Elijo Hills. Prior to
November 1997, Mr. Noland was employed for eight years by Aviara, a 1,000-acre
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<PAGE>
master planned resort community in Carlsbad, California. He is also a licensed
civil engineer and real estate broker.
Patrick D. Bienvenue. Mr. Bienvenue has served as a director of the
Company since 1998 and has been President of Leucadia Financial since June 1998.
Since January 1996, Mr. Bienvenue has been President of Rosemary Beach Land
Company, a subsidiary of Leucadia and, from 1992 until December 1995 he was
President and Chief Executive Officer of Torwest Inc., a property development
and investment company.
Timothy M. Considine. Mr. Considine has served as a director of the
Company since 1992, serving as Chairman of the Board from 1992 to December 1999,
and has been Managing Partner of Considine and Considine, an accounting firm in
San Diego, California, since 1969.
Ian M. Cumming. Mr. Cumming has served as a director of the Company
since May 1999 and has been a director and Chairman of Leucadia since June 1978.
He is also a director of Allcity Insurance Company ("Allcity"), a property and
casualty insurer that is approximately 90% owned by Leucadia, MK Gold Company
("MK Gold"), an international mining company that is approximately 73% owned by
Leucadia and Skywest, Inc., a Utah-based regional air carrier.
Michael A. Lobatz. Dr. Lobatz has served as a director of the Company
since February 1995 and has been a practicing physician in San Diego, California
since 1981.
Joseph S. Steinberg. Mr. Steinberg has served as a director of the
Company since August 1998 and as Chairman of the Board since December 1999. Mr.
Steinberg has been President of Leucadia since December 1978 and a director of
Leucadia since January 1979. He is also director of Allcity, MK Gold and Jordan
Industries, Inc., a company which owns and manages manufacturing companies and
is approximately 10% owned by Leucadia.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who beneficially own
more than ten percent of a registered class of the Company's equity securities,
to file reports of ownership and changes in ownership with the Securities and
Exchange Commission. Based solely upon a review of the copies of such forms
furnished to the Company and written representations from the Company's
executive officers, directors and greater than 10% beneficial shareholders, the
Company believes that during the year ended December 31, 1999, all persons
subject to the reporting requirements of Section 16(a) filed the required
reports on a timely basis.
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<PAGE>
Item 11. Executive Compensation.
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SUMMARY COMPENSATION TABLE
Set forth below is certain information with respect to the cash
compensation paid by the Company for services in all capacities to the Company
and its subsidiaries during the years ended 1999, 1998 and 1997 to (i) the
Company's current President and chief executive officer, Paul J. Borden, and
(ii) the one other executive officer of the Company whose total annual salary
and bonus exceeded $100,000 during these periods. The services of the Company's
current President and chief executive officer are provided pursuant to an
Administrative Services Agreement with Leucadia Financial. As a result, Mr.
Borden receives compensation from Leucadia and does not receive any compensation
from the Company. See "Certain Relationships and Related Transactions."
<TABLE>
<CAPTION>
Annual Compensation
-------------------------------------------------------------
Name and Principal Position Year Salary Bonus
- --------------------------- ---- ------ -----
<S> <C> <C> <C>
Paul J. Borden, 1999 - -
President (1) 1998 - -
Curt R. Noland, 1999 $100,000 $103,000
Vice President (2) 1998 $ 23,846 $ 53,000
</TABLE>
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(1) Mr. Borden is a Vice President of Leucadia and receives compensation
from Leucadia.
(2) Mr. Noland began his employment with the Company on October 1, 1998.
COMPENSATION OF DIRECTORS
In 1999, Directors who are also employees of the Company, Leucadia or
Leucadia Financial received no remuneration for services as a member of the
Board or any committee of the Board. In 1999, each Director who was not an
employee of the Company, Leucadia or Leucadia Financial was paid $3,000 for
attendance at each regular meeting of the Board of Directors.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
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Set forth below is certain information as of April 17, 2000 with
respect to the beneficial ownership of Common Stock by (i) each person who, to
the knowledge of the Company, is the beneficial owner of more than 5% of the
outstanding Common Stock (the Company's only class of voting securities), (ii)
each Director, (iii) the current executive officers named in the Summary
Compensation Table under "Executive Compensation," (iv) the Steinberg Children
Trusts and private charitable foundations established by Mr. Cumming and Mr.
Steinberg and (v) all executive officers and Directors of the Company as a
group.
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<TABLE>
<CAPTION>
Number of Shares
Name and Address and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
- ------------------- -------------------- --------
<S> <C> <C>
Patrick D. Bienvenue..................................... 10,000 *
Paul J. Borden........................................... 15,783 *
Timothy M. Considine..................................... 14,859 (a) *
Ian M. Cumming........................................... 7,847,609 (b)(c) 13.8%
Michael A. Lobatz........................................ 10,000 *
Curt R. Noland........................................... 25,000 *
Joseph S. Steinberg...................................... 7,199,280 (c)(d) 12.7%
The Steinberg Children Trusts............................ 893,258 (e) 1.6%
Cumming Foundation....................................... 73,297 (f) 0.1%
The Joseph S. and Diane H. Steinberg
1992 Charitable Trust............................... 23,815 (g) *
All Directors and executive officers
as a group (8 persons)................................ 15,137,531 26.6%
</TABLE>
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* Less than 0.1%.
(a) 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.
(b) Includes 211,319 shares of Common Stock (0.4%) beneficially owned by
Mr. Cumming's wife (directly and through trusts for the benefit of Mr.
Cumming's children of which Mr. Cumming's wife is trustee) as to which
Mr. Cumming may be deemed to be the beneficial owner.
(c) Messrs. Cumming and Steinberg have an oral agreement pursuant to which
they will consult with each other as to the election of a mutually
acceptable Board of Directors of the Company.
The business address for Messrs. Cumming and Steinberg is c/o Leucadia
National Corporation, 315 Park Avenue South, New York, New York 10010.
(d) Includes 36,761 shares of Common Stock (less than 0.1%) beneficially
owned by Mr. Steinberg's wife and daughter as to which Mr. Steinberg
may be deemed to be the beneficial owner.
(e) Mr. Steinberg disclaims beneficial ownership of the Common Stock held
by the Steinberg Children Trusts.
(f) Mr. Cumming is a trustee and President of the foundation and disclaims
beneficial ownership of the Common Stock held by the foundation.
(g) Mr. Steinberg and his wife are trustees of the trust. Mr. Steinberg
disclaims beneficial ownership of the Common Stock held by the trust.
As of April 17, 2000, Cede & Co. held of record 44,600,962 shares of
Common Stock (approximately 78.5% of the total Common Stock outstanding). Cede &
Co. held such shares as a nominee for broker-dealer members of The Depository
Trust Company, which conducts clearing and settlement operations for securities
transactions involving its members.
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<PAGE>
Item 13. Certain Relationships and Related Transactions.
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From the time of the Company's emergence from chapter 11 bankruptcy
protection in July 1995 through August 25, 1998, Leucadia owned approximately
41.2% of the outstanding Common Stock. On August 25, 1998, a trust was formed
for the benefit of Leucadia shareholders to hold this 41.2% interest. Under the
terms of the trust agreement, Mr. Joseph S. Steinberg, a Director of the
Company, as well as a Director and President of Leucadia, and Mr. Ian M.
Cumming, a Director of the Company, as well as Chairman of the Board of
Leucadia, jointly had the right to vote any shares of Common Stock held by the
trust. On July 8, 1999, the trust increased its interest in the Common Stock to
89.6% as described below. On October 8, 1999, the trust distributed all of the
Common Stock that it held to its beneficiaries.
Set forth below is information concerning agreements or relationships
between the Company and Leucadia and its subsidiaries.
DEVELOPMENT AGREEMENT
In August 1998, upon approval of the Board of Directors, with Mr.
Borden, a Leucadia Vice President as well as a Director of the Company, not
voting, the Company entered into a development management agreement with an
indirect subsidiary of Leucadia to become development manager of San Elijo
Hills, which will be a master planned community in San Diego County, California,
of approximately 3,400 homes and apartments as well as commercial properties. As
development manager, the Company is responsible for the overall management of
the project, including arranging financing, coordinating marketing and sales
activity, and acting as construction manager. The development agreement provides
that the Company will receive certain fees in connection with the project. These
fees consist of marketing, field overhead and management service fees, which are
based on a fixed percentage of gross revenues received by the project and are
expected to cover the Company's cost of providing these services. The
development agreement also provides for a success fee to the Company out of the
net cash flow, if any, from the project, as determined in accordance with the
development agreement, subject to a maximum success fee. Whether a success fee,
if it is earned, will be paid to the Company prior to the conclusion of the
project will be at the discretion of the project owner. From January 1, 1999
through March 31, 2000, the Company has received $ 877,760 in fees under the
development agreement.
AMENDED LOAN AGREEMENT
The Company's chapter 11 plan of reorganization was funded
principally by the issuance of a $20,000,000 convertible note to Leucadia
Financial. As of August 14, 1998, in connection with the development agreement,
the Company and Leucadia Financial entered into an Amended and Restated Loan
Agreement, pursuant to which the original convertible note and the related loan
agreement were restructured. The restructured note, dated August 14, 1998, has a
principal amount of approximately $26,462,000 including the principal amount of
the original note and additions to principal resulting from accrued and unpaid
interest, as allowed under the terms of the original note. The restructured note
extended the maturity date from July 3, 2003 to December 31, 2004, reduced the
interest rate from 12% to 6% and eliminated the convertibility feature of the
original note. Interest only on the restructured note is paid quarterly and all
unpaid principal is due on the date of maturity. From January 1, 1999 through
March 31, 2000, the Company has paid approximately $1,983,000 in interest on the
original note and the restructured note.
STOCK PURCHASE AGREEMENTS
In August and October 1998, the Company entered into two stock
purchase agreements with Leucadia that were subsequently assigned to a trust for
the benefit of Leucadia shareholders. Under these agreements, in July 1999, the
Company sold a total of 46,557,826 additional shares of Common Stock to the
trust for a total purchase price of $8,380,000. In October 1999, the trust
distributed its HomeFed Common Stock to the shareholders of Leucadia. As a
result, as of April 17, 2000, Mr. Joseph S. Steinberg, Chairman of the Board of
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Directors of the Company and a director and President of Leucadia, together with
certain family members (excluding trusts for the benefit of Mr. Steinberg's
children), beneficially owns approximately 12.7%, and Mr. Ian M. Cumming, a
director of the Company and Chairman of the Board of Leucadia, together with
certain family members, beneficially owns approximately 13.9%, of the
outstanding Common Stock.
OTAY LAND COMPANY, LLC
In October 1998, the Company and Leucadia formed Otay Land Company,
LLC ("Otay Land Company"). Through December 31, 1999, the Company invested
$11,300,000 as capital and Leucadia invested $10,000,000 as a preferred capital
interest. The Company is the manager of Otay Land Company. In 1998, Otay Land
Company purchased approximately 4,800 acres of land that is part of a
22,900-acre project located south of San Diego, California, known as Otay Ranch,
for approximately $19,500,000. Net income, if any, from this investment first
will be paid to Leucadia until it has received an annual cumulative preferred
return of 12% on, and repayment of, its preferred investment. Any remaining
funds are to be paid to the Company. No amounts have been paid to Leucadia under
this agreement.
ADMINISTRATIVE SERVICES AGREEMENT
Since emerging from bankruptcy in 1995, administrative services and
managerial support have been provided to the Company by Leucadia Financial.
Under the current administrative services agreement, which extends through
February 28, 2002, Leucadia Financial provides the services of Mr. Paul J.
Borden, the Company's President, and Ms. Corinne A. Maki, the Company's
Treasurer and Secretary. Mr. Borden is an officer of Leucadia Financial and
Leucadia and Ms. Maki is an officer of Leucadia Financial. Under the
administrative services agreement, the initial annual fee paid to Leucadia
Financial for the period ending February 29, 2000 was $296,101, with the fee for
subsequent annual periods to be negotiated. The parties are currently
negotiating the fee for the annual period beginning March 1, 2000. A portion of
the fee paid to Leucadia Financial is allocable to Leucadia's cost of providing
the services of Mr. Borden. No specific allocation has been made for providing
the services of Ms. Maki. From January 1, 1999 through March 31, 2000, the
Company paid Leucadia Financial $450,126 for the provision of administrative
services, of which $380,000 is attributable to Leucadia's cost of providing Mr.
Borden's services. Of the foregoing amounts, $80,000 was for services rendered
to the Company in 1998.
OFFICE SPACE
The Company rents office space and furnishings from a subsidiary of
Leucadia for a monthly amount equal to its share of the Leucadia subsidiary's
cost for the space and furnishings. The agreement pursuant to which the space
and furnishings are provided extends for a 6-year period, which coincides with
the Leucadia subsidiary's occupancy of the space, and provides for a monthly
rental of $15,890 effective March 1, 2000. From January 1, 1999 through March
31, 2000, the Company has paid $227,838 in rent to the Leucadia subsidiary.
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
HOMEFED CORPORATION
Registrant
By: /s/ Corinne A. Maki
--------------------------------
Corinne A. Maki
Secretary and Treasurer
(Principal Financial and
Accounting Officer)
Dated: April 27, 2000
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