Lennar proposes public offering of US$300M in convertible senior notes due 2021; proceeds may go to repurchase plan, paying off debt or land acquisition

Lorena Madrigal

MIAMI , November 22, 2011 (press release) – Lennar Corporation (NYSE: LEN and LEN.B) announced that it proposes to offer $300 million principal amount of Convertible Senior Notes due 2021 in a private offering under SEC Rule 144A. The initial purchasers of the Convertible Senior Notes are expected to have the option to purchase up to an additional $45 million principal amount of Convertible Senior Notes to cover over-allotments. The Convertible Senior Notes will be offered only to qualified institutional buyers in transactions that are exempt from the registration requirements of the Securities Act of 1933, as amended, under SEC Rule 144A.

The Convertible Senior Notes will provide for semi-annual interest payments and will be convertible at the option of the holders into Lennar's Class A common stock at any time prior to maturity or redemption at a conversion rate to be determined. The Convertible Senior Notes will mature on November 15, 2021, unless they are converted, redeemed or repurchased before that date. However, holders of the Convertible Senior Notes will have the right to require Lennar to repurchase them on November 15, 2016 for cash equal to 100% of their principal amount, plus accrued but unpaid interest. Lennar will have the right to redeem the Convertible Senior Notes at any time on or after November 20, 2016, for 100% of their principal amount, plus accrued but unpaid interest. When they are issued, the Convertible Senior Notes will be guaranteed by some of the Lennar's subsidiaries, but those guarantees may be suspended or released under certain circumstances.

Lennar plans to use the net proceeds from the sale of the Convertible Senior Notes for general corporate purposes, which may include the repayment or repurchase of its existing senior notes or other indebtedness, acquisitions of land suitable for residential development, and purchases of or investments in, portfolios of distressed mortgages or other debt instruments and foreclosed real estate.

None of the Convertible Senior Notes, any guarantees of the Convertible Senior Notes, or the shares of Lennar Class A common stock that will be issuable on conversion of the Convertible Senior Notes will be registered under the Securities Act of 1933, as amended. Neither the Convertible Senior Notes (including the guarantees) nor shares of Class A common stock that are issued on conversion of the Convertible Senior Notes may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of that Act.

This press release does not constitute an offer to sell or a solicitation of an offer to buy the Convertible Senior Notes in any jurisdiction in which such an offer or sale would be unlawful. It is issued pursuant to Rule 135c under the Securities Act of 1933, as amended.

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