SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2006
OR
[ ] 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 1-10153
HOMEFED CORPORATION
(Exact name of registrant as specified in its Charter)
Delaware 33-0304982
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1903 Wright Place, Suite 220, Carlsbad, California 92008
(Address of principal executive offices) (Zip Code)
(760) 918-8200
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
----------------------
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 whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):
Large accelerated filer Accelerated filer X Non-accelerated filer
---- ---- -----
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
YES NO X
------ -------
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. On April 29, 2006, there were
8,273,434 outstanding shares of the Registrant's Common Stock, par value $.01
per share.
Part I -FINANCIAL INFORMATION
-----------------------------
Item 1. Financial Statements.
HOMEFED CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
March 31, 2006 and December 31, 2005
(Dollars in thousands, except par value)
March 31, December 31,
2006 2005
-------------- --------------
(Unaudited)
ASSETS
- ------
Real estate $ 68,882 $ 62,319
Cash and cash equivalents 79,764 131,688
Investments-available for sale (aggregate cost of $94,832 and $65,181) 94,862 65,190
Accounts receivable, deposits and other assets 831 2,988
Deferred income taxes 30,680 32,076
-------- ---------
TOTAL $275,019 $294,261
======== =========
LIABILITIES
- -----------
Notes payable $ 10,560 $ 10,403
Deferred revenue 57,670 73,160
Accounts payable and accrued liabilities 12,257 12,601
Non-refundable option payments 13,583 13,583
Liability for environmental remediation 10,876 11,002
Income taxes payable 2,067 10,978
Other liabilities 7,649 3,612
-------- ---------
Total liabilities 114,662 135,339
-------- ---------
COMMITMENTS AND CONTINGENCIES
- -----------------------------
MINORITY INTEREST 18,506 17,457
- -----------------
-------- ---------
STOCKHOLDERS' EQUITY
- ---------------------
Common stock, $.01 par value; 25,000,000 shares authorized;
8,273,434 and 8,264,334 shares outstanding 83 83
Additional paid-in capital 381,307 381,224
Accumulated other comprehensive income 18 6
Accumulated deficit (239,557) (239,848)
-------- ---------
Total stockholders' equity 141,851 141,465
-------- ---------
TOTAL $275,019 $ 294,261
======== =========
See notes to interim consolidated financial statements.
2
HOMEFED CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
For the three month periods ended March 31, 2006 and 2005
(In thousands, except per share amounts)
(Unaudited)
2006 2005
---- ----
REVENUES
- --------
Sales of real estate $16,985 $ 4,087
Co-op marketing and advertising fees 251 428
------- -------
17,236 4,515
------- -------
EXPENSES
- --------
Cost of sales 4,424 900
Interest expense -- 62
General and administrative expenses 5,102 2,788
Administrative services fees to Leucadia 45 45
------- -------
9,571 3,795
------- -------
Income from operations 7,665 720
Other income, net 1,587 399
------- -------
Income before income taxes and minority interest 9,252 1,119
Income tax provision (3,776) (495)
------- -------
Income before minority interest 5,476 624
Minority interest (1,049) 18
------- -------
Net income $ 4,427 $ 642
======= =======
Basic income per common share $ 0.54 $ 0.08
======= =======
Diluted income per common share $ 0.54 $ 0.08
======= =======
See notes to interim consolidated financial statements.
3
HOMEFED CORPORATION AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders' Equity
For the three month periods ended March 31, 2006 and 2005
(In thousands, except par value and per share amounts)
(Unaudited)
Common Accumulated
Stock Additional Other Total
$.01 Par Paid-In Comprehensive Accumulated Stockholders'
Value Capital Income (Loss) Deficit Equity
-------- ---------- ------------- ------------ --------------
Balance, January 1, 2005 $ 83 $ 381,192 $ (14) $ (267,510) $ 113,751
---------
Comprehensive income:
Net change in unrealized gain (loss) on
investments, net of taxes of $2 (4) (4)
Net income 642 642
---------
Comprehensive income 638
---------
Exercise of options to purchase
common shares 1 1
----- --------- ----- ---------- ---------
Balance, March 31, 2005 $ 83 $ 381,193 $ (18) $ (266,868) $ 114,390
===== ========= ===== ========== =========
Balance, January 1, 2006 $ 83 $ 381,224 $ 6 $ (239,848) $ 141,465
---------
Comprehensive income:
Net change in unrealized gain (loss) on
investments, net of taxes of $9 12 12
Net income 4,427 4,427
---------
Comprehensive income 4,439
---------
Share-based compensation expense 15 15
Exercise of options to purchase
common shares 68 68
Dividends ($.50 per common share) (4,136) (4,136)
----- --------- ----- ---------- ---------
Balance, March 31, 2006 $ 83 $ 381,307 $ 18 $ (239,557) $ 141,851
===== ========= ===== ========== =========
See notes to interim consolidated financial statements.
4
HOMEFED CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
For the three month periods ended March 31, 2006 and 2005
(In thousands)
(Unaudited)
2006 2005
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 4,427 $ 642
Adjustments to reconcile net income to net cash used for
operating activities:
Minority interest 1,049 (18)
Provision for deferred income taxes 1,387 359
Share-based compensation expense 15 --
Net securities losses -- 1
Other amortization related to investments (711) (461)
Changes in operating assets and liabilities:
Real estate (6,406) (8,159)
Accounts receivable, deposits and other assets 2,157 603
Notes payable -- (159)
Deferred revenue (15,490) (3,462)
Accounts payable and accrued liabilities (344) 1,565
Liability for environmental remediation (126) (89)
Income taxes payable (8,911) --
Other liabilities (99) 17
---------- ---------
Net cash used for operating activities (23,052) (9,161)
---------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments (other than short-term) (56,240) (48,041)
Proceeds from maturities of investments-available for sale 27,300 48,790
Proceeds from sales of investments -- 3,095
---------- ---------
Net cash provided by (used for) investing activities (28,940) 3,844
---------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Exercise of options to purchase common shares 68 1
---------- ---------
Net decrease in cash and cash equivalents (51,924) (5,316)
Cash and cash equivalents, beginning of period 131,688 34,634
---------- ---------
Cash and cash equivalents, end of period $ 79,764 $ 29,318
========== =========
Supplemental disclosures of cash flow information:
Cash paid for interest (net of amounts capitalized) $ -- $ 265
Cash paid (refunded) for income taxes $ 11,300 $ (9)
See notes to interim consolidated financial statements.
5
HOMEFED CORPORATION AND SUBSIDIARIES
Notes to Interim Consolidated Financial Statements
1. The unaudited interim consolidated financial statements, which reflect all
adjustments (consisting of normal recurring items or items discussed
herein) that management believes are necessary to present fairly the
results of interim operations, should be read in conjunction with the Notes
to Consolidated Financial Statements (including the Summary of Significant
Accounting Policies) included in the Company's audited consolidated
financial statements for the year ended December 31, 2005, which are
included in the Company's Annual Report filed on Form 10-K for such year,
as amended (the "2005 10-K"). Results of operations for interim periods are
not necessarily indicative of annual results of operations. The
consolidated balance sheet at December 31, 2005 was derived from the
Company's audited annual consolidated financial statements and does not
include all disclosures required by accounting principles generally
accepted in the United States of America for annual financial statements.
Certain amounts for prior periods have been reclassified to be consistent
with the 2006 presentation.
2. The Company has a $10,000,000 line of credit agreement with a subsidiary of
Leucadia National Corporation ("Leucadia") that matures on February 28,
2007. Loans outstanding under this line of credit bear interest at 10% per
annum. At March 31, 2006, no amounts were outstanding under this facility.
3. Basic and diluted income per share of common stock was calculated by
dividing the net income by the weighted average shares of common stock
outstanding, and for diluted earnings per share, the incremental weighted
average number of shares issuable upon exercise of outstanding options for
the periods they were outstanding. The treasury stock method is used for
these calculations. The number of shares used to calculate basic earnings
per common share was 8,267,846 and 8,260,079 for the three month periods
ended March 31, 2006 and 2005, respectively. The number of shares used to
calculate diluted earnings per share was 8,272,211 and 8,273,618 for the
three month periods ended March 31, 2006 and 2005, respectively.
4. Pursuant to the administrative services agreement, Leucadia provides
administrative services, including the services of the Company's Secretary.
Administrative service fee expenses were $45,000 for each of the three
month periods ended March 31, 2006 and 2005. The administrative services
agreement automatically renews for successive annual periods unless
terminated in accordance with its terms. A subsidiary of the Company
subleases office space to Leucadia under a sublease agreement until
February 2010. Amounts reflected in other income pursuant to this agreement
were $3,000 and $9,000 in 2006 and 2005, respectively.
5. Certain of the Company's lot purchase agreements with homebuilders include
provisions that entitle the Company to a share of the revenues or profits
realized by the homebuilders upon their sale of the homes, after certain
thresholds are achieved. The actual amount which could be received by the
Company is generally based on a formula and other specified criteria
contained in the lot purchase agreements, and is generally not payable and
cannot be determined with reasonable certainty until the builder has
completed the sale of a substantial portion of the homes covered by the lot
purchase agreement. The Company accrued $600,000 under these agreements for
the period ended March 31, 2005. There was no income recognized pursuant to
these agreements during the period ended March 31, 2006.
6. As of April 29, 2006, the Company has entered into agreements that have not
closed with homebuilders to sell an additional 283 single family lots for
aggregate cash proceeds of $132,200,000, pursuant to which it received
non-refundable option payments of $13,600,000 prior to 2006. These option
payments are non-refundable if the Company completes site improvement work
and fulfills its other obligations under the agreements, and will be
applied to reduce the amount due from the purchasers at closing. Although
these agreements are binding on the purchasers should the Company fulfill
its obligations under the agreements within the specified timeframes and a
purchaser decides not to close, the Company's recourse will be primarily
limited to retaining the option payment. The Company expects these sales
agreements will close during the second half of 2006 and in 2007.
6
Notes to Interim Consolidated Financial Statements, continued.
7. On March 14, 2006, the Company's Board of Directors declared a cash
dividend of $.50 per common share to stockholders of record on March 27,
2006; such dividend aggregated $4,100,000 and was paid in April 2006.
8. Effective January 1, 2006, the Company adopted Statement of Financial
Accounting Standards No. 123R, "Share-Based Payment" ("SFAS 123R"), using
the modified prospective method. SFAS 123R requires that the cost of all
share-based payments to employees, including grants of employee stock
options, be recognized in the financial statements based on their fair
values. The cost is recognized as an expense over the vesting period of the
award. Prior to adoption of SFAS 123R, no compensation cost was recognized
in the statements of operations for the Company's share-based compensation
plans; the Company disclosed certain pro forma amounts as required.
The fair value of each option award is estimated at the date of grant using
the Black-Scholes option pricing model. As a result of the adoption of SFAS
123R, compensation cost increased by $15,000 for the 2006 period; had the
Company used the fair value based accounting method for the 2005 period,
2005 compensation costs would have been higher by $10,000. As of March 31,
2006, total unrecognized compensation cost related to nonvested share-based
compensation plans was $160,000; this cost is expected to be recognized
over a weighted-average period of 2.8 years. No options were granted during
the 2006 or 2005 periods.
As of March 31, 2006, the Company has a fixed stock option plan which
provides for grants of options or rights to directors and certain employees
up to a maximum grant of 30,000 shares to any individual in a given taxable
year. The maximum number of common shares which may be acquired through the
exercise of options or rights under this plan cannot exceed 500,000. The
plan provides for the issuance of stock options and stock appreciation
rights at not less than the fair market value of the underlying stock at
the date of grant. Options granted to employees under this plan are
intended to qualify as incentive stock options to the extent permitted
under the Internal Revenue Code and become exercisable in five equal annual
instalments starting one year from date of grant. Options granted to
directors become exercisable in four equal annual instalments starting one
year from date of grant. No stock appreciation rights have been granted. As
of March 31, 2006, 487,900 shares were available for grant under the plan.
The following table summarizes information about outstanding stock options
at March 31, 2006 and changes during the three months then ended:
Weighted-Average
Weighted-Average Remaining Aggregate Intrinsic
Shares Exercise Price Contractual Term Value
------ -------------- ---------------- -------------------
Outstanding at
January 1, 2006 22,575 $ 33.24
Granted -- $ --
Exercised (9,100) $ 7.52 $500,000
Forfeited -- $ -- ========
------
Outstanding at
March 31, 2006 13,475 $ 50.61 3.6 years $200,000
====== ======= ========= ========
Exercisable at
March 31, 2006 2,525 $ 32.03 2.5 years $100,000
====== ======= ========= ========
7
Notes to Interim Consolidated Financial Statements, continued.
9. In 2005, the Company commenced a lawsuit to terminate a lease for farming
rights and collect unpaid rent with respect to approximately 1,000 acres of
the Rampage property that is leased by one of its former owners. During
April 2006, a jury issued a verdict in favor of the former owner, pursuant
to which the Company is not entitled to any additional rent payments for
the 2005 lease period and allows the former owner to retain possession of
the property under the terms of the lease. In a separate matter, the former
owner is also seeking to rescind the sale of the Rampage property, as well
as monetary damages, alleging fraud, breach of contract and various other
claims. The Company is currently evaluating its options with respect to
these matters.
The Company does not expect that the ultimate resolution of these matters
will be material to its consolidated financial position; however, should
the Company need to accrue or pay damages, any such loss could be material
to its consolidated results of operations during the period recorded.
8
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Interim Operations.
Liquidity and Capital Resources
For the three month period ended March 31, 2006, net cash was used for operating
activities, principally for real estate expenditures at the San Elijo Hills
project, federal and state tax payments and general and administrative expenses.
For the three month period ended March 31, 2005, net cash was used for operating
activities, principally for real estate expenditures at the San Elijo Hills
project and general and administrative expenses. The Company's principal sources
of funds are proceeds from the sale of real estate, its unused $10,000,000 line
of credit with a subsidiary of Leucadia, fee income from the San Elijo Hills
project, dividends and tax sharing payments from its subsidiaries and borrowings
from or repayment of advances by its subsidiaries. As of March 31, 2006, the
Company had aggregate cash, cash equivalents and investments of $174,600,000 to
meet its current needs and for future investment opportunities.
As of March 31, 2006, the aggregate balance of deferred revenue for all real
estate sales was $57,700,000, which the Company estimates will be substantially
recognized as revenue by the end of 2008. The Company estimates that it will
spend approximately $16,300,000 to complete the required improvements, including
costs related to common areas. The Company will recognize revenues previously
deferred and the related cost of sales in its statements of operations as the
improvements are completed under the percentage of completion method of
accounting.
As of March 31, 2006, the remaining land at the San Elijo Hills project to be
developed and sold or leased consisted of the following (including real estate
under contract for sale):
Single family lots to be developed and sold 467
Multi-family units 40
Square footage of commercial space 132,000
As of April 29, 2006, the Company has entered into agreements with homebuilders
that have not closed to sell an additional 283 single family lots for aggregate
cash proceeds of $132,200,000, pursuant to which it had received non-refundable
option payments of $13,600,000 prior to 2006. These option payments are
non-refundable if the Company completes site improvement work and fulfills its
other obligations under the agreements, and will be applied to reduce the amount
due from the purchasers at closing. Although these agreements are binding on the
purchasers, should the Company fulfill its obligations under the agreements
within the specified timeframes and a purchaser decides not to close, the
Company's recourse will be primarily limited to retaining the option payment.
The Company is currently developing lots that are under contract for sale or
being marketed for sale. Assuming the Company's development is not delayed, it
expects to close the sales of the remaining single family residential lots
during 2006 and 2007; however, development activity on units sold is expected to
continue into 2007 and on common areas into 2008. These estimates of future
property available for sale and the timing of the sales are based upon current
development plans for the project and could change based on actions of
regulatory agencies, the strength of the housing market and other factors that
are not within the control of the Company.
In 2006, the Company hired a contractor to construct the mixed-use retail and
residential space in the towncenter. The Company intends to construct and lease
57,000 square feet of commercial space and sell the remainder of the commercial
space to third party builders or owners, including the supermarket site and
daycare center site. The Company also intends to construct and sell the 40
multi-family residential units which will be located above the retail stores.
In April 2006, the Company paid a cash dividend of $4,100,000 ($.50 per common
share) to stockholders of record on March 27, 2006, which the Company's Board of
Directors declared on March 14, 2006.
9
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Interim Operations, continued.
Results of Operations
Real Estate Sales Activity
San Elijo Hills Project:
------------------------
There were no sales that closed during the first quarter of 2006 and 2005. The
Company expects lot sale agreements currently under contract will close during
the second half of 2006 and in 2007.
As discussed above, a portion of the revenue from sales of real estate is
deferred, and is recognized as revenues upon the completion of the required
improvements to the property, including costs related to common areas, under the
percentage of completion method of accounting. Revenues include amounts that
were previously deferred of $15,500,000 and $3,500,000 for the periods ended
March 31, 2006 and 2005, respectively, which were recognized upon completion of
certain required improvements.
Revenues from sales of real estate also include amounts recognized pursuant to
revenue or profit sharing agreements with homebuilders of $600,000 for the
period ended March 31, 2005. There was no income recognized pursuant to these
agreements during 2006.
During the periods ended March 31, 2006 and 2005, cost of sales of real estate
aggregated $4,300,000 and $900,000, respectively. Cost of sales is recognized in
the same proportion to the amount of revenue recognized under the percentage of
completion method of accounting.
Otay Ranch Project:
-------------------
During the first quarter of 2006, the Company sold approximately 115 acres of
non-developable land for $1,500,000 and recognized a gain of $1,400,000 on the
sale. There was no real estate sales activity at the Otay Ranch project during
the first quarter of 2005.
As discussed in the 2005 10-K, the Company continues to evaluate how to maximize
the value of Otay Ranch and is processing further entitlements on portions of
its property, which have not changed significantly during 2006. If the Company
decides to develop the developable land at Otay Ranch, development will not
begin for a few years and is likely to take several years to complete.
In 2005, the Chula Vista City Council adopted an amendment to the General
Development Plan ("GDP") which modified land use designations in the Otay Ranch
area, but deferred action with regard to land uses for developable land owned by
Otay Land Company. As more fully discussed in the 2005 10-K, the Company had
supported an amendment which would have increased the number of approved
residential dwelling units from 2,880 to 6,000, and would have increased
approved commercial development space from approximately 1.5 million square feet
to approximately 1.8 million square feet. In April 2006, the City Council
determined that it would not consider any additional amendments to the GDP until
August 2006. The Company is unable to predict the impact the ultimate resolution
of these matters will have, nor can any assurance be given that the City Council
will approve the currently pending amendment to the GDP.
Other Results of Operations Activity
The Company recorded co-op marketing and advertising fees of $300,000 and
$400,000 for the three month periods ended March 31, 2006 and 2005,
respectively. The Company records these fees when the San Elijo Hills project
builders sell homes, and are generally based upon a fixed percentage of the
homes' selling price. These fees provide the Company with funds to conduct its
marketing activities.
Interest expense in 2005 includes $60,000 related to the Rampage note payable
which was fully repaid in July 2005.
10
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Interim Operations, continued.
Interest expense excludes capitalized interest of $200,000 for the three month
periods ended March 31, 2006 and 2005. Interest is capitalized for the notes
payable to trust deed holders on the San Elijo Hills project.
General and administrative expenses increased during the three month period
ended March 31, 2006 as compared to the same period in 2005, primarily due to
greater expenses related to legal and compensation. Legal expense increased by
$1,900,000 relating to costs associated with pursuing the claims against the
previous owners of undeveloped land that is undergoing environmental remediation
at the Otay Ranch project and legal costs in connection with the dispute with
the tenant at the Rampage property. Compensation expense increased by $300,000
in 2006 due to an increase in estimated general bonus expense and more sales and
executive employees. Compensation expense in 2005 included a $200,000 bonus
awarded to the President to pay taxes due on reimbursed expenses relating to his
temporary residence in California and the reimbursement of certain costs
incurred by a newly hired executive officer.
The increase in other income for the 2006 period as compared to the same period
in 2005 primarily relates to investment income. Investment income increased by
$1,200,000 primarily due to greater interest income resulting from higher
interest rates and greater assets invested. Other income also reflects an
increase in farming expenses of $200,000 at the Rampage property.
The Company's effective income tax rate during the 2006 and 2005 periods are
higher than the federal statutory rate due to California state income taxes.
Cautionary Statement for Forward-Looking Information
Statements included in this Report may contain forward-looking statements. Such
statements may relate, but are not limited, to projections of revenues, income
or loss, development expenditures, plans for growth and future operations,
competition and regulation, as well as assumptions relating to the foregoing.
Such forward-looking statements are made pursuant to the safe-harbor provisions
of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are inherently subject to risks and uncertainties,
many of which cannot be predicted or quantified. When used in this Report, the
words "estimates," "expects," "anticipates," "believes," "plans," "intends" and
variations of such words and similar expressions are intended to identify
forward-looking statements that involve risks and uncertainties. Future events
and actual results could differ materially from those set forth in, contemplated
by or underlying the forward-looking statements.
Factors that could cause actual results to differ materially from any results
projected, forecasted, estimated or budgeted or may materially and adversely
affect the Company's actual results include but are not limited to the
following: the performance of the real estate industry in general; changes in
mortgage interest rate levels or changes in consumer lending practices that
reduce demand for housing; the economic strength of the Southern California
region where our business is currently concentrated; changes in domestic laws
and government regulations or in the implementation and/or enforcement of
government rules and regulations; demographic changes in the United States
generally and California in particular that reduce the demand for housing;
increases in real estate taxes and other local government fees; significant
competition from other real estate developers and homebuilders; delays in
construction schedules and cost overruns; increased costs for land, materials
and labor; imposition of limitations on our ability to develop our properties
resulting from condemnations, environmental laws and regulations and
developments in or new applications thereof; earthquakes, fires and other
natural disasters where our properties are located; construction defect
liability on structures we build or that are built on land that we develop; our
ability to insure certain risks economically; shortages of adequate water
resources and reliable energy sources in the areas where we own real estate
projects; changes in the composition of our assets and liabilities through
acquisitions or divestitures; the actual cost of environmental liabilities
concerning our land could exceed liabilities recorded; and our ability to
generate sufficient taxable income to fully realize our deferred tax asset. For
additional information see Part I, Item 1A. Risk Factors in the 2005 10-K.
Undue reliance should not be placed on these forward-looking statements, which
are applicable only as of the date hereof. The Company undertakes no obligation
to revise or update these forward-looking statements to reflect events or
circumstances that arise after the date of this Report or to reflect the
occurrence of unanticipated events.
11
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Information required under this Item is contained in Item 7A of the Company's
Annual Report on Form 10-K for the year ended December 31, 2005, and is
incorporated by reference herein.
Item 4. Controls and Procedures.
Evaluation of disclosure controls and procedures
(a) The Company's management evaluated, with the participation of the
Company's principal executive and principal financial officers, the
effectiveness of the Company's disclosure controls and procedures (as
defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), as of March 31, 2006.
Based on their evaluation, the Company's principal executive and
principal financial officers concluded that the Company's disclosure
controls and procedures were effective as of March 31, 2006.
Changes in internal control over financial reporting
(b) There were no changes in the Company's internal controls over
financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under
the Exchange Act) that occurred during the Company's fiscal quarter
ended March 31, 2006, that has materially affected, or is reasonably
likely to materially affect, the Company's internal control over
financial reporting.
12
PART II - OTHER INFORMATION
---------------------------
Item 6. Exhibits.
31.1 Certification of President pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
31.2 Certification of Vice President, Treasurer and Controller
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification of Principal Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Principal Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
13
SIGNATURES
----------
Pursuant to the requirements 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.
HOMEFED CORPORATION
(Registrant)
Date: May 8, 2006 By: /s/ Erin N. Ruhe
---------------------------------
Erin N. Ruhe
Vice President, Treasurer and
Controller
(Principal Accounting Officer)
14
EXHIBIT INDEX
Exhibit Number Description
31.1 Certification of President pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.
31.2 Certification of Vice President, Treasurer and
Controller pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
32.1 Certification of Principal Executive Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Principal Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
15