def14a
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant þ
Filed by a Party other than the Registrant o
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to Rule 14a-12 |
LENNAR 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):
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No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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Title of each class of securities to which transaction applies: |
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Aggregate number of securities to which transaction applies: |
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Per unit price or other underlying value of
transaction computed pursuant to Exchange Act
Rule 0-11 (set forth the amount on which the filing
fee is calculated and state how it was determined): |
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Proposed maximum aggregate value of transaction: |
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Total fee paid: |
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Fee paid previously with preliminary materials. |
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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. |
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Amount Previously Paid: |
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Form, Schedule or Registration Statement No.: |
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700 Northwest
107th Avenue
Miami, Florida
33172
(305) 559-4000
Notice of 2011
Annual Meeting of Stockholders
To the
Stockholders of Lennar Corporation:
This is to notify you that the 2011 Annual Meeting of
Stockholders of Lennar Corporation will be held at our offices
at 700 Northwest 107th Avenue, Second Floor, Miami, Florida
33172 on Wednesday, April 13, 2011, at
11:00 a.m. Eastern Time, for the following purposes:
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1.
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To elect nine Directors to serve until the next Annual Meeting
of Stockholders;
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2.
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To have an advisory vote on the Companys compensation of
executive officers (a non-binding
say-on-pay
vote);
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3.
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To have an advisory vote on how frequently stockholders should
vote on the Companys compensation of executive officers (a
non-binding
say-on-frequency
vote);
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4.
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To vote on proposed amendments to Sections 7.1 through 7.4
of the Companys Bylaws;
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5.
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To vote on a proposed amendment to Article XI of the
Companys Bylaws;
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6.
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To ratify the selection of Deloitte & Touche LLP as
the Companys independent registered public accounting firm
for the Companys fiscal year ending November 30, 2011;
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7.
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To act on a stockholder proposal regarding the Companys
building practices; and
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8.
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To act upon any other matters that properly come to a vote at
the annual meeting.
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Only stockholders of record at the close of business on
February 16, 2011 will be entitled to notice of and to vote
at the meeting or any adjournment of the meeting.
We cordially invite you to attend the annual meeting in person.
However, whether or not you plan to attend the meeting in
person, it is important that your shares are represented at the
meeting. We ask that you either vote your shares or return the
enclosed proxy card at your earliest convenience. If you give a
proxy, you may revoke it at any time before it is used.
By Order of the Board of Directors
Mark Sustana
Secretary and General Counsel
Miami,
Florida
March 3, 2011
700 Northwest
107th Avenue
Miami, Florida
33172
(305) 559-4000
2011 Annual
Meeting of Stockholders
Proxy
Statement
Solicitation
of Proxies
Our Board of Directors is soliciting the accompanying proxy in
connection with matters to be considered at our 2011 Annual
Meeting of Stockholders to be held at our offices at 700
Northwest 107th Avenue, Second Floor, Miami, Florida 33172
on Wednesday, April 13, 2011 at
11:00 a.m. Eastern Time. The individuals named on the
proxy card will vote all shares represented by proxies in the
manner designated or, if no designation is made, they will vote
as follows:
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(1)
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FOR each of the nine nominees named in this proxy statement for
election to the Board of Directors;
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(2)
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FOR approval of the Companys compensation of executive
officers;
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(3)
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For holding a non-binding vote every ONE year regarding approval
of the Companys compensation of executive officers;
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(4)
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FOR approval of the amendments to Sections 7.1 through 7.4
of the Companys Bylaws described below;
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(5)
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FOR approval of the amendment to Article XI of the
Companys Bylaws described below;
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(6)
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FOR the ratification of the selection of Deloitte &
Touche LLP as the Companys independent registered public
accounting firm for the Companys fiscal year ending
November 30, 2011;
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(7)
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AGAINST the stockholder proposal regarding the Companys
building practices; and
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(8)
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In their best judgment with respect to any other matters that
properly come to a vote at the annual meeting.
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The individuals who act as proxies will not vote shares that are
the subject of a proxy card on a particular matter if the proxy
card instructs them to abstain from voting on that matter or to
the extent the proxy card is marked to show that some of the
shares represented by the proxy card are not to be voted on that
matter.
Record
Date
Only stockholders of record at the close of business on
February 16, 2011 will be entitled to notice of or to vote
at this annual meeting or any adjournment of the meeting. On
or about March 3, 2011, we are mailing a Notice of
Availability of Proxy Materials, which describes how to obtain
copies of this proxy statement, to all stockholders of record on
February 16, 2011.
Shares Outstanding
and Voting Rights
We have two classes of voting stock outstanding, Class A
common stock and Class B common stock. At February 16,
2011, 155,628,595 shares of Class A common stock were
outstanding and 31,303,197 shares of
Class B common stock were outstanding. Each outstanding
share of Class A common stock entitles the holder to one
vote. Each outstanding share of Class B common stock
entitles the holder to ten votes.
Counting
Votes
The inspector of election appointed for the meeting will count
the votes cast by proxy or in person at the annual meeting. A
majority in voting power, and not less than one-third in number,
of the shares entitled to vote, represented in person or by
proxy, will constitute a quorum for the transaction of business
at the annual meeting. Our 401(k) plan provides that the trustee
of the 401(k) plan will vote the shares of our common stock that
are not directly voted by the participants. Shares as to which
there are abstentions, and shares held by brokers that are not
voted as to particular proposals, will nonetheless be included
in determining if a quorum is present or represented at the
annual meeting. Brokers who hold shares in street name for
customers will not be able to vote the shares without
instructions from their customers with respect to any of the
proposals, other than the proposal to ratify the selection of
our auditors. Shares for which brokers have not received
instructions, and which therefore are not voted, with respect to
a particular proposal are referred to as broker
non-votes with respect to that proposal. Neither
abstentions from voting on a proposal described in this proxy
statement nor broker non-votes will affect the outcome of the
vote on that proposal.
Voting
Requirements
Each Director will be elected by a plurality of the votes cast
with regard to the election of Directors by the holders of
shares of our Class A and Class B common stock, voting
together as a single class. A majority of the votes cast by the
holders of shares of our Class A and Class B common
stock, voting together as a single class, is required to approve
any of the other proposals (including the stockholder proposal),
except that with regard to the advisory vote on how frequently
our stockholders should vote on the compensation of our
executive officers, the number of years (1, 2 or 3) that
receives the highest number of votes will be deemed to be
preferred by our stockholders.
How
to Vote
To vote by mail:
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(1)
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Mark, sign and date your proxy card; and
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(2)
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Return your proxy card in the enclosed envelope.
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To vote over the Internet:
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(1)
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Have your notice and proxy card available;
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(2)
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Log on to the Internet and visit the website noted on your proxy
card;
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(3)
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Follow the instructions provided; and
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(4)
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Do not mail your proxy card.
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To vote by telephone:
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(1)
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Have your notice and proxy card available;
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(2)
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Call the toll-free number listed on your proxy card;
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(3)
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Follow the recorded instructions; and
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(4)
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Do not mail your proxy card.
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To vote in person if you are a registered stockholder:
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(1)
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Attend our annual meeting;
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(2)
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Bring a valid government issued photo identification; and
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(3)
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Deliver your completed proxy card or ballot in person.
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To vote in person if your shares are held in street
name (through a bank or broker):
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(1)
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Attend our annual meeting;
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(2)
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Bring a valid government issued photo identification; and
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(3)
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Obtain from your bank or broker a document that authorizes you
to vote the shares that are held for your benefit, attach that
document to your completed proxy card or ballot and deliver it
in person.
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Revoking
Your Proxy
You may revoke your proxy at any time before it is used:
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(1)
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In person at the annual meeting;
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(2)
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By a writing delivered to our offices before the proxy is
used; or
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(3)
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By a later-dated proxy delivered to our offices before the proxy
is used.
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Your presence at the meeting will not revoke your proxy, but if
you attend the meeting and cast a ballot with regard to a
matter, you will revoke your proxy as to that matter.
Cost
and Method of Solicitation
We will bear the cost of soliciting proxies. We are soliciting
proxies by mail and, in addition, our Directors, officers and
employees (associates) may solicit proxies
personally or by telephone. We will not reimburse any Director,
officer or associate for their solicitation. We will reimburse
custodians, brokerage houses, nominees and other fiduciaries for
the cost of sending proxy materials to beneficial owners.
3
The following table shows stock ownership information as of
February 16, 2011 with respect to each of our stockholders
who is known by us to be a beneficial owner of more than 5% of
either class of our outstanding common stock. To the best of our
knowledge, and except as otherwise indicated, the persons named
in this table have sole voting and investment power with respect
to all shares of common stock shown as beneficially owned by
them.
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Amount and Nature
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of Beneficial
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Percent of
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Name and Address of Beneficial Owner
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Title of Class
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Ownership
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Class(7)
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Stuart A. Miller
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Class B Common Stock
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21,409,783(1
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68.4%
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700 Northwest 107th Avenue
Miami, FL 33172
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FMR LLC
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Class A Common Stock
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27,734,983(3
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17.8%
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82 Devonshire Street
Boston, MA 02109
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BlackRock, Inc.
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Class A Common Stock
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8,595,120(4
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5.5%
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40 East
52nd
Street
New York, NY 10022
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Taube Hodson Stonex Partners LLP
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Class A Common Stock
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8,282,270(5
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5.3%
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Cassini House
1st Floor
57-59 St.
Jamess Street
London, SW1A 1LD, England
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Moab Partners, L.P.
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Class B Common Stock
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1,566,654(6
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5.0%
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15 East
62nd
Street
New York, New York 10065
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(1)
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Mr. Miller, his brother and
his sister are trustees and beneficiaries of trusts that
directly or indirectly hold controlling and substantial limited
partner interests in two partnerships (Mr. Miller, his
brother and sister also directly own minor limited partnership
interests in the two partnerships), which together own
21,204,314 of the shares of Class B common stock reflected
in this table. Mr. Miller is the sole officer and the sole
director of the corporation that owns the general partner
interests in the partnerships and Mr. Miller has sole
voting and dispositive power over these shares. Because of that,
Mr. Miller is shown as the beneficial owner of the shares
held by the partnerships, even though he has only a limited
pecuniary interest in those shares. In addition, Mr. Miller
has shared voting and investment power with respect to 104,262
of the shares of Class B common stock reflected in this
table.
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(2)
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Includes 97,730 shares of
Class B common stock owned by Mr. Miller,
1,857 shares of Class B common stock allocated to
Mr. Millers account under the Companys Employee
Stock Ownership Plan and options to purchase 1,620 shares
of Class B common stock held by Mr. Miller, which are
currently exercisable or will become exercisable within
60 days after February 16, 2011.
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(3)
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Based on Amendment No. 5 to
the stockholders Schedule 13G, filed on
February 14, 2011. Fidelity Management & Research
Company, a registered investment adviser and a wholly-owned
subsidiary of FMR LLC, beneficially owns 27,531,937 shares
of Class A common stock as a result of acting as investment
adviser to various registered investment companies (the
Funds). One Fund, Fidelity Magellan Fund, owns
13,380,585 shares of Class A common stock. Edward C.
Johnson 3d has effective control of FMR LLC, and therefore may
be deemed to be the beneficial owner of all shares of which FMR
LLC is beneficial owner. FMR LLC has sole voting power with
regard to 203,046 shares and sole dispositive power as to
all 27,734,983 shares.
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(4)
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Based on the stockholders
Schedule 13G, filed on February 7, 2011.
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(5)
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Based on the stockholders
Schedule 13G, filed on May 20, 2010.
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(6)
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Based on the stockholders
Schedule 13G, filed on February 7, 2011. Moab Capital
Partners, LLC, as investment adviser to Moab Partners, L.P., and
Michael N. Rothenberg and David A. Sackler, as part owners and
managing members of Moab Capital Partners, LLC, may be deemed to
be beneficial owners of the shares held by Moab Partners, L.P.
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(7)
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Percent of Class is determined in
accordance with
Rule 13d-3
under the Securities Exchange Act of 1934, based on the total
issued and outstanding shares of the class indicated as of
February 16, 2011.
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The following table shows beneficial ownership information as of
February 16, 2011 for (1) each of our current
Directors, (2) each of the named executive
officers who are listed in the Summary Compensation
Table and (3) all of our current Directors and
executive officers as a group. The share amounts and ownership
percentages shown for each individual in the table include
shares of Class A or Class B common stock that are not
currently outstanding but which the individual may acquire upon
exercise of options held by
4
that individual that are currently exercisable or will become
exercisable within 60 days after February 16, 2011. To
the best of our knowledge, and except as otherwise indicated,
the persons named in this table have sole voting and investment
power with respect to all the shares of common stock shown as
beneficially owned by them.
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Class of Common Stock
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Class A Common Stock
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Class B Common Stock
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Amount and
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Amount and
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Nature of
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Nature of
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Beneficial
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Percent of
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Beneficial
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Percent of
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Name of Beneficial Owner
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Ownership
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Class(10)
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Ownership
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Class(10)
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Rick Beckwitt
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1,000,000
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(1)
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*
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*
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Diane J. Bessette
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213,584
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(2)
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*
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8,159
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(2)
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*
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Irving Bolotin
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124,508
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(3)
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*
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15,288
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*
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Steven L. Gerard
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20,618
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(3)
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*
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850
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Theron I. (Tig) Gilliam
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3,900
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(4)
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*
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*
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Bruce E. Gross
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587,450
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(5)
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*
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72,382
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(5)
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Sherrill W. Hudson
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23,500
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(3)
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*
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5,000
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*
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Jonathan M. Jaffe
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1,348,618
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(6)
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*
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50,905
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(6)
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R. Kirk Landon
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47,300
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(3)
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*
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22,380
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Sidney Lapidus
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206,842
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(3)
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*
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39,996
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Stuart A. Miller
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2,130,047
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(7)
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1.4%
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21,409,783
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(8)
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68.4%
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Donna E. Shalala
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15,000
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(3)
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*
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200
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Jeffrey Sonnenfeld
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15,604
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(3)
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*
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*
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Directors and Officers as a Group (15 persons)
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5,948,066
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(9)
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3.8%
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21,626,572
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(9)
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69.1%
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*
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less than 1%
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(1)
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Includes options to purchase
300,000 shares of Class A common stock.
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(2)
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Includes options to purchase
34,000 shares of Class A and 1,400 shares of
Class B common stock.
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(3)
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Includes options to purchase
7,500 shares of Class A common stock.
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(4)
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Includes options to purchase
2,500 shares of Class A common stock.
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(5)
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Includes options to purchase
143,000 shares of Class A and 1,800 shares of
Class B common stock.
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(6)
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Includes options to purchase
254,000 shares of Class A and 400 shares of
Class B common stock.
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(7)
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Includes options to purchase
16,202 shares of Class A common stock. In addition,
Mr. Miller has shared voting and investment power with
respect to 182,650 shares of Class A common stock
reflected in this table.
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(8)
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Includes options to purchase
1,620 shares of Class B common stock. Mr. Miller,
his brother and his sister are trustees and beneficiaries of
trusts that directly or indirectly hold controlling and
substantial limited partner interests in two partnerships
(Mr. Miller, his brother and sister also directly own minor
limited partnership interests in the two partnerships), which
together own 21,204,314 of the shares of Class B common
stock reflected in this table. Mr. Miller is the sole
officer and the sole director of the corporation that owns the
general partner interests in the partnerships and
Mr. Miller has sole voting and dispositive power over these
shares. Because of that, Mr. Miller is shown as the
beneficial owner of the shares held by the partnerships, even
though he has only a limited pecuniary interest in those shares.
In addition, Mr. Miller has shared voting and investment
power with respect to 104,262 of the shares of Class B
common stock reflected in this table.
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(9)
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Includes options to purchase
833,902 shares of Class A and 5,640 shares of
Class B common stock.
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(10)
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Percent of Class is determined in
accordance with
Rule 13d-3
under the Securities Exchange Act of 1934, based on the total
issued and outstanding shares of the class indicated as of
February 16, 2011.
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Because each outstanding share of Class B common stock
entitles the holder to ten votes and each outstanding share of
Class A common stock entitles the holder to one vote, as of
February 16, 2011, Mr. Miller had the power to cast
216,195,523 votes, which is 46.1% of the combined votes that can
be cast by all the holders of Class A common stock and
Class B common stock, and all of our Directors and
executive officers as a group had the power to cast 221,323,532
votes, which is 47.2% of the combined votes that can be cast by
all the holders of Class A common stock and Class B
common stock.
5
Our Board of Directors is responsible for overseeing the
management of our business. We keep Directors informed of our
business at meetings and through reports and analyses presented
to the Board of Directors and committees of the Board. Regular
communications between the Directors and management also occur
apart from meetings of the Board of Directors and committees of
the Board. Specifically, from time to time the Board schedules
calls with senior management to discuss the Companys
business strategies.
Our Board of Directors currently consists of nine members, each
of whom has a term that ends at the time of the next Annual
Meeting of Stockholders. Each of the nominees is currently a
director and has been nominated for re-election to the Board.
The following table provides information about the nominees for
election as Directors.
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Director
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Director Nominees
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Age
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Since
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Irving Bolotin
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78
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1974
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Steven L. Gerard
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65
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2000
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Theron I. (Tig) Gilliam
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46
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2010
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|
Sherrill W. Hudson
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68
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|
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2008
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|
R. Kirk Landon
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81
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1999
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Sidney
Lapidus(1)
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73
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1997
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Stuart A.
Miller(1)
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53
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1990
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Donna E. Shalala
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70
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2001
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Jeffrey Sonnenfeld
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56
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|
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2005
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|
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(1)
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Member of our Executive Committee.
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At our 2011 annual meeting, the persons named in the
accompanying proxy will vote FOR the election of each of the
persons listed above to serve as a member of our Board of
Directors until our next Annual Meeting of Stockholders, except
to the extent that particular proxies contain instructions to do
otherwise.
Biographical
Information about Our Director Nominees
Irving Bolotin has served as a Director of our company since
1974. Mr. Bolotin is currently retired. From 1972 until his
retirement in December 1998, Mr. Bolotin served as a Senior
Vice President of our company. During the past five years,
Mr. Bolotin has served, and he currently serves, on the
Boards of Directors of Rechtien International Trucks, Inc. and
WPBT Channel 2. We believe Mr. Bolotin is particularly
suited to contribute as a Director because of the extensive
knowledge of homebuilding he obtained during the many years he
was a member of our senior management.
Steven L. Gerard has served as a Director of our company since
May 2000. Since October 2000, Mr. Gerard has served as a
director and Chief Executive Officer of CBIZ, Inc., a provider
of professional business services to individuals and companies
throughout the United States. Mr. Gerard was elected
Chairman of CBIZ, Inc. in October 2002. From July 1997 to
October 2000, Mr. Gerard served as Chairman and Chief
Executive Officer of Great Point Capital, Inc., an operations
and financial consulting firm. From September 1992 to July 1997,
Mr. Gerard served as Chairman and Chief Executive Officer
of Triangle Wire & Cable, Inc., and its successor,
Ocean View Capital, Inc., a manufacturer of residential,
commercial and industrial wire and cable products. Prior to
that, Mr. Gerard spent sixteen years in various corporate
finance and banking positions at Citibank, N.A. and spent seven
years at the American Stock Exchange, last serving as Vice
President of its Securities Division. During the past five
years, in addition to serving on the Board of CBIZ, Inc.,
Mr. Gerard has served on the Boards of Directors of The
Fairchild Corporation, Timco Aviation Services, Inc and Joy
Global, Inc. He currently is a director and a member of the
Human Resources and Nominating Committee and the Audit Committee
of Joy Global, Inc. We believe Mr. Gerard is particularly
6
suited to contribute as a Director because of his experience as
the chief executive officer and in other senior management
positions of significant companies for many years.
Theron I. (Tig) Gilliam became a Director in June
2010. Mr. Gilliam is Regional Head of North America and a
member of the Executive Committee at Addeco Group SA, a human
resources, temporary staffing and recruiting firm. From 2002
until he joined Addeco in March 2007, Mr. Gilliam was with
International Business Machines, serving among other things as
the Global Supply Chain Management Leader for IBM Global
Business Services. Mr. Gilliam was a partner with
PricewaterhouseCoopers Consulting until it was acquired by IBM
in October 2002. We believe Mr. Gilliams expertise in
matters related to supply chain management and human resources
will enable him to make important contributions to our Board of
Directors.
Sherrill W. Hudson has served as a Director of our Company since
January 2008. Mr. Hudson is the Executive Chairman of TECO
Energy, Inc. From 2004 until August 2010, he was the Chief
Executive Officer of TECO Energy. Prior to joining TECO Energy
in July 2004, Mr. Hudson spent 37 years with
Deloitte & Touche LLP until he retired in 2002.
Mr. Hudson is a member of the Florida Institute of
Certified Public Accountants. In addition to serving on the
Board of TECO Energy, Mr. Hudson currently is a director of
Publix Supermarkets, Inc. During the past five years, he also
served on the board of directors of The Standard Register
Company. We believe Mr. Hudson is particularly suited to
contribute as a Director because of his extensive knowledge of
accounting and his management experience.
R. Kirk Landon has served as a Director of our company since
January 1999. Since 1996, Mr. Landon has served as the
President of The Kirk Foundation and President of The Kirk A.
and Dorothy P. Landon Foundation. From 2001 to 2007,
Mr. Landon served as Chairman of Orange Clothing Company, a
clothing manufacturing company. From 1993 until 2006,
Mr. Landon served as Chairman of Innovative Surveillance
Technology, a provider of surveillance equipment. From 1977 to
1995 he served as president, and then chief executive officer,
of American Bankers Insurance Company of Florida and American
Bankers Life Assurance Company of Florida. From 1991 to 1998, he
served as Chairman and a Director of the Federal Reserve Bank of
Atlanta (Miami branch). From 1983 until 2004, Mr. Landon
served on the Board of Trustees of Barry University and from
2005 to 2010, he served on the Board of Trustees of Florida
International University. We believe Mr. Landon is
particularly suited to contribute as a Director because of his
background in insurance and bank regulatory matters.
Sidney Lapidus has served as a Director of our company since
April 1997. Mr. Lapidus is a retired partner of Warburg
Pincus LLC, a private equity investment firm, and was with
Warburg Pincus from 1967 until his retirement at the end of
2007. During the past five years, Mr. Lapidus has served,
and he currently serves, on the board of directors of Knoll,
Inc. and The Neiman Marcus Group, Inc., as well as a number of
non-profit organizations. We believe Mr. Lapidus is
particularly suited to contribute as a Director because of the
extensive knowledge of business enterprises (including
homebuilding companies) and corporate governance he gained as a
partner in a private equity investment firm and as a director of
a number of publicly and privately owned companies.
Stuart A. Miller has served as a Director of our company since
April 1990 and has served as our President and chief executive
officer since April 1997. If our stockholders approve the bylaw
amendments that are the subject of Proposal 4,
Mr. Miller will cease to be our President, but will hold
the newly created office of Chief Executive Officer and will
continue to be our chief executive officer. From 1997 until
2005, Mr. Miller served as the Chairman of the Board of LNR
Property Corporation, a company that invests in commercial real
estate and real estate-related securities, which was a
wholly-owned subsidiary of ours until it was spun-off in October
1997. We believe Mr. Miller is particularly suited to
contribute as a Director because he is our chief executive
officer and has extensive knowledge of our company, its
operations and its strategic plans.
Donna E. Shalala has served as a Director of our company since
April 2001. Since June 2001, Ms. Shalala has served as the
President of the University of Miami, a private higher-education
institution, as well as a Professor of Political Science. From
January 1993 until January 2001, Ms. Shalala served as the
U.S. Secretary of Health and Human Services. From 1987
until 1993, Ms. Shalala served as a Professor of Political
Science and Chancellor of the University of Wisconsin-Madison.
Ms. Shalala also served as a
7
Professor of Political Science and President of Hunter College
from 1980 to 1987 and as Assistant Secretary for Policy
Development and Research of the Department of Housing and Urban
Development during the Carter administration. A distinguished
political scientist, she has served widely in the areas of
education, urban housing and health policy. During the past five
years, Ms. Shalala has served, and she currently is
serving, on the board of directors of Gannett Co., Inc. and
Mednax, Inc., and as a member of the Council on Foreign
Relations. During the past five years, Ms. Shalala had
served on the board of directors of UnitedHealth Group. We
believe Ms. Shalala is particularly suited to contribute as
a Director because of the knowledge of government she obtained
as a professor of political science, an Assistant Secretary of
the Department of Housing and Urban Planning and as the
Secretary of Health and Human Services, as well as the knowledge
of management she has gained as the President of a major
university.
Jeffrey Sonnenfeld has served as a Director of our company since
September 2005. Mr. Sonnenfeld has served as the Senior
Associate Dean for Executive Programs and the Lester Crown
Professor-in-the-Practice
of Management for the Yale School of Management since 2001. In
1989, Mr. Sonnenfeld founded the Chief Executive Leadership
Institute of Yale University, and he has served as its President
since that time. During the past five years, Mr. Sonnenfeld
had served on the board of directors of Levity HR, Inc. and
TheStreet.com. We believe Mr. Sonnenfeld is particularly
suited to contribute as a Director because of his business
acumen and experience, as well as his exceptional work in the
areas of corporate governance and leadership development as part
of the Chief Executive Leadership Institute that he founded and
of which he is the President.
Corporate
Governance
Structure
of our Board
Until 2006, we had both a Chairman of the Board and a chief
executive officer. When the then Chairman of the Board died in
2006, we did not replace him. Instead, we have a Lead Director,
who presides over Board meetings and presides at all meetings of
our independent Directors. Our Board believes that arrangement
works well for us, because all but one of our directors (our
chief executive officer) is independent, and our Lead Director
can cause the independent Directors to meet at any time.
Therefore, the Lead Director can at any time bring to the
attention of a majority of the Directors any matters he thinks
should be addressed by the Board and the independent Directors
can, if they wish, cause the entire Board to meet in order to
address matters. On the other hand, the Lead Director does not
have any functions that might impair, or appear to impair, his
independence.
Meeting
Attendance
Our Board of Directors normally meets quarterly, but holds
additional meetings as required. Under our Corporate Governance
Guidelines, each Director is required to attend substantially
all meetings of the Board. During fiscal 2010, the Board of
Directors met eight times. Each Director attended at least 75%
of (1) the total number of meetings of the Board of
Directors held while that Director was serving on our Board, and
(2) the total number of meetings of each committee of the
Board on which he or she was serving. It is our policy to
encourage Directors and nominees for Director to attend the
annual meeting of stockholders. All members of our Board
attended last years annual meeting of stockholders.
Independent
Directors
Our Board of Directors has unanimously determined that eight of
our nine Directors, Messrs. Bolotin, Gerard, Gilliam,
Hudson, Landon, Lapidus and Sonnenfeld and Ms. Shalala, are
independent Directors under the Director
Qualification Standards set forth in our Corporate Governance
Guidelines, which are consistent with the New York Stock
Exchange Corporate Governance Standards. After considering any
relevant transactions or relationships between each Director, or
any of his or her family members, and the
8
Company, our senior management and our independent registered
public accounting firm, the Board of Directors has affirmatively
determined that none of the independent Directors has a material
relationship with us (either directly, or as a partner,
stockholder, officer or affiliate of an organization that has a
relationship with us), other than as a member of our Board of
Directors.
Mr. Lapidus serves as our Lead Director. In this capacity,
Mr. Lapidus presides over Board meetings in the absence of
a Chairman (we have not had a Chairman since our former
Chairmans death in 2006) and presides at all meetings
of our independent Directors. In connection with our regularly
scheduled board meetings, our independent Directors regularly
meet in executive sessions that exclude our non-independent
Director and management. Mr. Lapidus presides over these
executive sessions.
Committees
of the Board of Directors
Our Board of Directors has established an Audit Committee, a
Compensation Committee, a Nominating and Corporate Governance
Committee, an Executive Committee and an Independent Directors
Committee. We provide information about each of these committees
below.
Audit
Committee
The Audit Committee consists of Messrs. Hudson
(Chairperson), Bolotin, Gerard and Landon. Our Board of
Directors has determined that all the members of the Audit
Committee are independent, and have all other required
qualifications for service on our Audit Committee, under the New
York Stock Exchange Corporate Governance Standards and the
applicable rules of the Securities and Exchange Commission. Our
Board of Directors has also determined that Mr. Gerard and
Mr. Hudson are audit committee financial experts, as that
term is defined in SEC
Regulation S-K.
The Audit Committee met ten times during fiscal 2010.
Our Board of Directors has adopted a charter for the Audit
Committee. A copy of the Audit Committee Charter is available on
our website at www.lennar.com and is available in print
to any stockholder who requests a copy from us. Under its
charter, the principal functions of the Audit Committee are:
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(1)
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to oversee the integrity of our financial statements, our
compliance with legal and regulatory requirements, our
independent registered public accounting firms
qualifications, independence and performance and our internal
auditors performance;
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(2)
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to prepare the report that appears in our annual meeting proxy
statement; and
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(3)
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to provide an open line of communication among our independent
registered public accounting firm, our internal auditors, our
management and our Board of Directors.
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The Audit Committees responsibilities also include direct
supervision of our internal auditors; selecting and determining
the compensation of our independent registered public accounting
firm; pre-approving all audit and non-audit services provided to
us by our independent registered public accounting firm; meeting
regularly with our independent registered public accounting
firm, our management and our internal auditors; reviewing any
issues regarding accounting or internal control over financial
reporting, including any significant deficiencies or material
weaknesses in our internal control over financial reporting
reported to the Audit Committee by our chief executive officer
or our chief financial officer; receiving and reviewing
complaints regarding accounting, internal control over financial
reporting or auditing matters, including anonymous submissions
by associates and others regarding questionable accounting or
auditing matters; and reviewing with our counsel legal
compliance and legal matters that could have a significant
impact on our financial statements.
9
Compensation
Committee
The Compensation Committee consists of Messrs. Gerard
(Chairperson), Hudson and Landon. Our Board of Directors has
determined that all the members of the Compensation Committee
are independent under the New York Stock Exchange Corporate
Governance Standards. The Compensation Committee met four times
during fiscal 2010.
Our Board of Directors has adopted a charter for the
Compensation Committee. A copy of the Compensation Committee
Charter is available on our website at www.lennar.com and
is available in print to any stockholder who requests a copy
from us. The Compensation Committees principal functions
are:
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(1)
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to recommend to the full Board of Directors the compensation of
our principal executive officer;
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(2)
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to set compensation policies and programs and review management
decisions regarding compensation of our senior executives, other
than our principal executive officer;
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(3)
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to review the performance of our principal executive officer and
our other executive officers;
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(4)
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to review with management the Compensation Discussion and
Analysis that is prepared for inclusion in our proxy statement
and to recommend whether that Compensation Discussion and
Analysis should be included in the proxy statement; and
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(5)
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to prepare the Compensation Committee Report that appears in our
proxy statement.
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In addition, the Compensation Committee makes recommendations to
the Board of Directors regarding incentive-compensation plans
and equity-based plans that will apply to our senior management.
The Compensation Committee has the authority to engage
compensation consultants. The Compensation Committee has not
sought an analyses of our compensation programs since an
analysis was performed by Hewitt Associates in 2007.
Under the Lennar Corporation 2007 Equity Incentive Plan, the
Compensation Committee has the authority to delegate all or a
part of its duties with respect to awards under that Plan to
management (excluding awards intended to qualify for an
exemption under Section 162(m) of the Internal Revenue
Code, awards made to individuals covered by Section 16 of
the Securities Exchange Act, and awards issued to any person
delegated authority by the Compensation Committee). Under the
Lennar Corporation 2007 Incentive Compensation Plan, the
Compensation Committee has the authority to delegate all or a
part of its duties with respect to bonuses under the plan to
management (excluding bonuses intended to qualify for an
exemption under Section 162(m) of the Internal Revenue
Code).
A further description of the Compensation Committees
processes and procedures for considering and determining
executive compensation is contained in the Compensation
Discussion and Analysis section of this Proxy Statement.
Nominating
and Corporate Governance Committee
The Nominating and Corporate Governance Committee consists of
Ms. Shalala (Chairperson), Mr. Bolotin and
Mr. Sonnenfeld. Our Board of Directors has determined that
all the members of the Nominating and Corporate Governance
Committee are independent under the New York Stock Exchange
Corporate Governance Standards. The Nominating and Corporate
Governance Committee met four times during fiscal 2010.
Our Board of Directors has adopted a charter for the Nominating
and Corporate Governance Committee. A copy of the Nominating and
Corporate Governance Committee Charter is available on our
website at www.lennar.com and is available in print to
any stockholder who requests a copy from us. Under its charter,
the principal functions of the Nominating and Corporate
Governance Committee are:
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(1)
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to identify individuals qualified to serve on the Board;
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10
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(2)
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to recommend the persons the Board should nominate for election
at our annual meeting of stockholders;
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(3)
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to develop and recommend to the Board corporate governance
guidelines applicable to us; and
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(4)
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to oversee the evaluation of the Board and management.
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The Nominating and Corporate Governance Committee has authority
to identify and evaluate director nominees from many sources,
including nominees recommended by stockholders in accordance
with the procedures described below. The Nominating and
Corporate Governance Committee reviews the personal
characteristics and professional competencies of director
candidates with the Board members to ensure that the nominees
selected are those best suited, from a corporate governance
standpoint, to join our Board and oversee our strategies and
operations.
The Nominating and Corporate Governance Committee and the Board
of Directors have determined that a Director should have the
following characteristics, as set forth in our Corporate
Governance Guidelines:
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Ability to comprehend our strategic goals and to help guide us
towards the accomplishment of those goals;
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A history of conducting
his/her own
personal and professional affairs with the utmost integrity and
observing the highest standards of values, character and ethics;
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Time availability for in-person participation and to be present
at the annual meeting of stockholders;
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Willingness to demand that our officers and associates insist
upon honest and ethical conduct throughout the company;
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Knowledge of, and experience with regard to, at least some of
the following: (a) real estate properties, loans and
securities, including any lending and financing activities
related thereto; (b) public company regulations imposed by
the Securities and Exchange Commission and the New York Stock
Exchange, amongst others; (c) portfolio and risk
management; (d) the major geographic locations within which
we operate; (e) sound business practices; and
(f) accounting and financial reporting; and
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If applicable, ability to satisfy the criteria for independence
established by the Securities and Exchange Commission and the
New York Stock Exchange, as they may be amended from
time-to-time.
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The Nominating and Corporate Governance Committee has not
considered racial or ethnic diversity in evaluating possible
directors. It does not believe race or ethnic background is
relevant to a persons qualifications to serve on the
Board. While it recognizes the benefits of diversity of training
and experience, it does not believe that race or ethnic
background significantly affects a persons ability to
contribute to our Board.
The Nominating and Corporate Governance Committee will consider
candidates recommended by stockholders. If a stockholder wishes
to recommend a nominee for director, the stockholder should mail
a recommendation to the Company containing the following
information:
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The recommending stockholders name and contact information;
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The candidates name and contact information;
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A brief description of the candidates background and
qualifications;
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The reasons why the recommending stockholder believes the
candidate would be well suited for the Board;
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A written statement by the candidate that the candidate is
willing and able to serve on the Board;
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11
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A written statement by the recommending stockholder that the
candidate meets the criteria established by the Board; and
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A brief description of the recommending stockholders
ownership of our common stock and the period during which such
shares have been held.
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In making its determination whether to recommend that the Board
of Directors nominate a candidate who has been recommended by a
stockholder, the Nominating and Corporate Governance Committee
will consider, among other things, the appropriateness of adding
another Director to the Board and the candidates
background and qualifications. The Nominating and Corporate
Governance Committee may conduct an independent investigation of
the background and qualifications of a candidate recommended by
a stockholder, and may request an interview with the candidate.
The Nominating and Corporate Governance Committee will not
determine whether to recommend that the Board nominate a
candidate until the Nominating and Corporate Governance
Committee completes what it believes to be a reasonable
investigation, even if that causes its recommendation to be
delayed until after it is too late for the candidate to be
nominated for election at a particular meeting of stockholders.
When the Nominating and Corporate Governance Committee
determines not to recommend that the Board nominate a candidate
recommended by a stockholder, or the Board determines to
nominate or not to nominate a candidate, the Nominating and
Corporate Governance Committee will notify the recommending
stockholder and the candidate of the determination.
Executive
Committee
Our By-Laws provide that the Board of Directors may establish an
Executive Committee, which has all authority to act on behalf of
the Board of Directors, except as that power is limited by the
corporate laws of the State of Delaware, where our company is
incorporated, and except as our Board of Directors otherwise
provides. Our Executive Committee consists of
Messrs. Miller and Lapidus. The Executive Committee took
action by unanimous written consent eight times during fiscal
2010.
Independent
Directors Committee
Our By-Laws require that an Independent Directors Committee
review and approve certain ventures and transactions that we
enter into with LNR Property Corporation (LNR) and
significant transactions between LNR and us or any of our
subsidiaries. Also, at the request of the full Board of
Directors, the chief executive officer or the chief financial
officer, the Independent Directors Committee may review or
investigate any transaction or matter involving the Company or
any subsidiary of the Company, whether or not the transaction or
matter involves LNR. The Independent Directors Committee
consists of all of the Directors who are not associates of our
company. Mr. Lapidus, our Lead Director, serves as
Chairperson of the Independent Directors Committee. The
Independent Directors Committee met four times during fiscal
2010. The Independent Directors Committee was created because
Stuart A. Miller, our chief executive officer, and his family
had a large ownership interest in LNR and Stuart Miller was the
chairman of the board of LNR. LNR was purchased by private
equity investors in 2004, but because the Miller family acquired
a significant equity interest in the entity that purchased LNR,
the Independent Directors Committee continued to review
transactions with LNR. The Miller familys interest in the
parent of LNR was reduced in 2010, but because the Miller family
still owns a significant interest in that entity, the
Independent Directors Committee continues to review any
transactions with LNR.
Code
of Business Conduct and Ethics
Our Code of Business Conduct and Ethics for our Directors,
officers and associates is available on our website at
www.lennar.com and is available in print to any
stockholder who requests a copy from us.
12
Corporate
Governance Guidelines
Our Corporate Governance Guidelines are available on our website
at www.lennar.com and are available in print to any
stockholder who requests a copy from us.
If you would like to request copies of any of our committee
charters, our Code of Business Conduct and Ethics, or our
Corporate Governance Guidelines, please send your request to the
Office of the General Counsel at Lennar Corporation, 700
Northwest 107th Avenue, Miami, Florida 33172.
Matters
Related to Risk Management
Board
Oversight of Our Exposure to Risk
Since 2007, our Board has followed the practice of identifying
areas of risk that particularly affect our Company and assigning
senior members of our management to report to the Board on each
of those areas of risk on a rotating basis at the regularly
scheduled quarterly Board meetings. The areas of risk identified
by the Board change from time to time based on business
conditions, advice of outside advisors, and review of risks
identified by our competitors in their public filings.
Currently, the risk areas reported on to our Board relate to
joint ventures, liquidity, housing inventories, construction
costs, homebuilding overhead, construction quality and warranty
exposure, land availability, associate retention, mergers and
acquisitions, legal matters, natural disasters and taxation.
In addition, one of the responsibilities of the Audit Committee
of our Board is to discuss and review policies with respect to
risk assessment and risk management, including guidelines and
policies governing our risk assessment and risk management
processes.
Effects
of our Compensation Programs on Risk
All significant land acquisitions, debt incurrences and joint
venture relationships are reviewed, and must be approved, by our
senior corporate management. Therefore, even though associates
in our divisions often have performance targets that will be
affected by growth or short term profitability of their
divisions, they are not in a position to cause us to undertake
transactions that might expose us to risks that are material to
us as a company without the concurrence of our senior corporate
management.
Although no cash bonuses were paid in fiscal 2008 and 2009 to
our senior executives and other members of our senior
management, and the decision to pay cash bonuses for fiscal 2010
was not made until the year was over, under normal circumstances
we have paid bonuses, and we propose to pay cash bonuses with
regard to 2011, to our senior management based upon achievement
of performance targets. However, because most of the decisions
that could expose us to significant risks, such as the amount of
land we should purchase, relate to matters that affect our long
term profitability but not our short term profitability, and
because most of our senior executives have performance targets
based on our results as a company, we do not think that, even
when our incentive bonus programs are in effect, those programs
create material incentives for our senior executives, or any
other of our associates, to expose us to significant risk.
Senior management in our Rialto segment share in an incentive
pool that in fiscal 2010 consisted, and in fiscal 2011 will
consist, of a percentage of the profits of that segment. While
incentive compensation based on a single years profits can
lead associates to recommend actions that will maximize short
term profits even if they increase long term risks, we believe
the possibility of this materially affecting us is minimized by
the fact that all significant investment decisions regarding the
Rialto segment or assets it manages must be approved by our
senior corporate management.
With regard to our Lennar Financial Services segment, although
the compensation of associates may be affected by the number of
mortgages we originate, because we sell almost all the mortgages
we originate
13
within 60 days after we fund them, we do not believe our
compensation system creates incentives for our associates to do
things that expose us to significant risks.
In the last four years, we have had to take significant write
downs of the carrying values of land we owned, forfeit deposits
and pre-acquisition costs with regard to land purchase options
we decided not to exercise and write down our investments in
unconsolidated joint ventures, as well as assets in
unconsolidated joint ventures in which we have investments.
However, our decisions to purchase land, to obtain land purchase
options or invest in unconsolidated joint ventures were made on
the basis of what were believed to be in the best long term
interests of us, as a company, and our stockholders as a whole,
not on the basis of compensation incentives to particular
executives or other associates. Stock options and restricted
stock we grant have long-term vesting periods, which we believe
align the performance of our executives with the long-term goals
of the Company.
Director
Compensation
Non-employee Directors are paid annual fees of $50,000 per year,
payable on a quarterly basis, 50% in cash and 50% in shares of
our common stock. The shares are not transferable (other than to
the Directors estate) until three years after the last day
of the quarter in which they are issued. In addition to the
annual fees, each non-employee Director receives $3,000 for each
board meeting and $1,000 for each committee meeting, other than
Audit Committee meetings, attended in person (but only one fee
for all Board or committee meetings attended on a single day),
and $500 for each Board meeting and $250 for each committee
meeting attended by teleconference. Audit Committee members
receive an additional $3,000 and the Audit Committee Chairperson
receives an additional $5,000 for each Audit Committee meeting
attended. Audit Committee fees are paid in addition to fees for
other meetings attended on the same day. A Director may elect to
defer payment of both the cash and stock portion of fees until
he or she no longer serves as a Director of our company. If a
director makes this election, a number of phantom shares of
Class A common stock with a value equal to the amount of
the deferred fees (based upon the closing sales price of the
Class A common stock on the date of the relevant meeting)
is credited to the directors deferred compensation
account. Amounts equal to the dividends that would have been
paid if the phantom shares had actually been outstanding are
also credited to the directors accounts and treated as
though they were used to purchase additional shares of
Class A common stock. Upon termination of a directors
deferred compensation account, the director will receive cash
equal to the value at the time of termination of the number of
phantom shares of Class A common stock credited to the
directors account.
Our Lead Director receives an additional $15,000 per year for
his services in that capacity.
In addition to the fees described above, each year, on the date
of our annual meeting of stockholders, each non-employee
Director receives options to purchase 2,500 shares of our
Class A common stock at an exercise price equal to the fair
market value of our Class A common stock on that date.
These options become exercisable in full six months after the
grant date and expire on the third anniversary of the grant
date. Directors also receive an annual grant of
2,000 shares of our Class A common stock on the date
of the first Board meeting following our annual meeting of
stockholders. Directors are permitted to sell 50% of that stock
at any time but are required to hold the remaining 50% of the
stock until the second anniversary of the date of grant.
Our chief executive officer, who is our only
employee-director,
receives no additional remuneration for his service as a
Director.
14
The following table sets forth compensation information for our
last fiscal year for all of our Directors except our chief
executive officer. The compensation of our chief executive
officer is described in the section of this Proxy Statement
captioned Executive Compensation.
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Change in
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Fees
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Nonqualified
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Earned or
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Non-Equity
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Deferred
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Paid in
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Stock
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Option
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Incentive Plan
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Compensation
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All Other
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Name
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Cash($)
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Awards($)(1)
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Awards($)(2)
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Compensation($)(3)
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Earnings ($)(4)
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Compensation($)(5)
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Total($)
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Irving Bolotin
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52,750
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61,560
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22,820
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393
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137,523
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Steven L. Gerard
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36,560
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22,820
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79,250
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4,397
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240
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143,267
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Theron I. (Tig)
Gilliam(6)
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13,458
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29,000
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76
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42,534
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Sherrill W Hudson
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36,560
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22,820
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87,750
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2,722
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240
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150,092
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R. Kirk Landon
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36,560
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22,820
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79,500
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5,178
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240
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144,298
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Sidney Lapidus
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36,560
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22,820
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79,000
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1,813
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240
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140,433
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Donna E. Shalala
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36,560
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22,820
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63,000
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3,442
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240
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126,062
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Jeffrey Sonnenfeld
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36,560
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22,820
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64,000
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2,708
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240
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126,328
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(1)
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Includes shares with a value of
$25,000 issued to Mr. Bolotin as payment of 50% of his
annual fee. Also includes an award of 2,000 shares of
Class A common stock, having a grant date fair value of
$18.28 per share, issued to each of the directors on
April 14, 2010. These shares were fully vested upon
issuance, but 50% of the shares are subject to a two-year
minimum holding period from the date of issuance.
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(2)
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Represents the grant date fair
value of awards calculated using the Black-Scholes
option-pricing model, which is different from the amounts
recognized for financial statement reporting purposes for the
year ended November 30, 2010. An award of options to
purchase 2,500 shares of Class A common stock, with a
fair market value of $9.13 per share, was made to each of the
directors on April 14, 2010 (except to Mr. Gilliam who
was not a director at the time ). In addition, an award of
options to purchase 2,500 shares of Class A common
stock, with a fair market value of $5.38 per share, was made to
Mr. Gilliam on June 25, 2010 (the day Mr. Gilliam
became a director). Further information regarding the
assumptions used in the calculation of the grant date fair
values of option awards can be found in Note 13 of the
Consolidated Financial Statements in our Annual Report on
Form 10-K
for the year ended November 30, 2010. As of
February 16, 2011, Messrs. Bolotin, Gerard, Hudson,
Landon, Lapidus, Sonnenfeld and Ms. Shalala each held
options to purchase 7,500 shares of Class A common
stock and Mr. Gilliam held options to purchase
2,500 shares of Class A common stock.
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(3)
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Messrs. Gerard, Gilliam,
Hudson, Landon, Lapidus, Sonnenfeld and Ms. Shalala have
elected to defer payment of both the cash and stock portions of
their fees. As part of this deferral, a number of phantom shares
of Class A common stock with a value equal to the amount of
the deferred fees (based on the closing sales price of the
Class A common stock on the date of the relevant meeting or
meetings) are credited to their deferred compensation accounts.
Sums equal to any dividend paid with regard to the Class A
common stock are also credited to their accounts and treated as
though they were used to purchase additional shares of
Class A common stock on the day the dividend was paid. Upon
termination of a deferred compensation account, a director will
receive cash equal to the value of the number of shares of
Class A common stock credited to the directors
account.
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(4)
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Represents sums equal to dividends
on phantom shares credited to the directors deferred
compensation account.
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(5)
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Represents sums equal to dividends
on stock awards that were not factored in calculating the grant
date fair value of the awards.
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(6)
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Mr. Gilliam became a director
on June 25, 2010 and all compensation information provided
is based upon Mr. Gilliams service during the
Companys 2010 fiscal year since he became a director.
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Executive
Compensation
Compensation Discussion and
Analysis
Overview
Our compensation program for executive officers is intended to
attract, motivate and retain highly qualified and experienced
executives, reward superior performance and provide incentives
that are based on our performance as a company. Historically,
our executive compensation program has consisted of the
following components:
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base salary;
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cash bonuses;
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stock options
and/or
restricted stock; and
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vacation, medical, 401(k) and other employee benefits, which are
generally available to associates.
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15
We do not have employment contracts,
change-in-control
agreements or any other severance programs for our executives.
However, most of our equity incentive programs provide for
acceleration of vesting if there is a change in control of the
Company.
Our compensation policy has been to offer market driven base
salaries commensurate with each associates position in the
Company and individual performance, and to have a substantial
portion of the total compensation paid to our senior officers be
highly variable based upon individual and Company performance
and include an equity component to align the interests of senior
officers with those of our stockholders. Normally, we have set
specific operating goals for our senior officers which have
determined their bonus opportunities and we have determined the
split between cash and equity based upon our performance as a
Company, individual performance and industry and market
conditions. However, in recent years prior to 2010, that was not
the case.
Since the beginning of fiscal 2007, there has been a major
dislocation in the market for new homes that significantly
reduced the number of homes we could sell and the prices at
which we could sell them. Primarily because of this, during
2007, 2008 and 2009, our revenues were down significantly, we
had substantial operating losses and net losses and the price of
our stock fell sharply. In response to the contraction of our
activities, we reduced our head count from 13,000 associates at
November 30, 2006 to approximately 3,800 associates at
December 31, 2009. Under those circumstances, the
Compensation Committee of our Board of Directors felt it would
not be appropriate for us to pay cash bonuses to our senior
executives for 2008 and 2009. All incentive compensation to our
senior executives with regard to those years was in the form of
stock options and restricted stock.
As is discussed below, during fiscal 2010, we returned to
profitability despite the continuing reduced demand for new
homes, and we had a number of other significant accomplishments.
Because of this, after the end of fiscal 2010, the Compensation
Committee approved both restricted stock grants and cash bonuses
for our senior executives.
Executive
Compensation Objectives
Our primary objectives with regard to compensation of our
executives are to:
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attract, motivate and retain highly qualified and experienced
executives;
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award compensation that recognizes valuable individual
performance and motivates executives to maximize the
Companys short-term and long-term performance;
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maintain flexibility to ensure that awards are competitive
within our peer group of homebuilders and Fortune
500 companies;
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align the interests of our executives with those of our
stockholders; and
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promote adherence to corporate governance, company policy and
values.
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In order to attract, motivate and retain experienced and
talented executives, we believe we must provide salaries and
total compensation packages that are attractive and competitive
in the homebuilding industry. We also believe it is important to
have a portion of an executives overall compensation tied
to his or her
day-to-day
value to the Company. When reviewing an executives value
to the Company, we review factors such as industry experience,
the number of years with the Company, significance of job
function, ability to analyze and make decisions on significant
business and financial objectives, and the ability to work as an
important member of senior management and serve as a leader for
other associates. Because of market conditions, for several
years prior to 2010, we had not sought to attract executives at
operational levels. During 2010, we formed a new segment, our
Rialto segment, which invests in distressed real estate and
mortgage related assets and manages investments for others. We
had to attract experienced executives to operate that segment.
In addition, during 2010 we started opening new communities,
which we had not done for several years. This made it very
important that we retain the executives who are responsible for
our
16
operations, as well as retaining the senior executive officers
who have been responsible for directing our responses to the
depressed housing markets and preparing to take advantage of
resumed demand that is being experienced in an increasing number
of areas.
Process
for Determining Compensation
Authority
and Role of Compensation Committee
Our Compensation Committee evaluates and approves the
compensation for our chief executive officer and our most senior
executive officers, including all the named executive officers.
Its determinations regarding the compensation of our chief
executive officer are made on the basis of the factors it
believes to be applicable (discussed below). Its determinations
regarding the compensation of our other corporate level
executive officers take into account recommendations by our
chief executive officer and any other factors the Compensation
Committee believes to be applicable.
The Compensation Committee also administers our equity programs,
including awards under our 2007 Equity Incentive Plan.
Role
of Chief Executive Officer
Our Chief Executive Officer reviews the performance of our
executive officers, other than himself, and makes compensation
recommendations to the Compensation Committee regarding these
executive officers.
Compensation
Consultants
The Compensation Committee has the authority to engage
compensation consultants. However, neither the Compensation
Committee nor our management engaged compensation consultants in
fiscal 2010.
Review
of Compensation
We review the compensation of our executive officers on a
regular basis. The Compensation Committee Chairperson and other
members of the Compensation Committee also have discussions with
management during the year and occasionally request that
management prepare or obtain market summaries and survey data
regarding executive compensation matters for the
Committees review. In addition, the Compensation Committee
reviews information disclosed in public filings by companies we
view to be in our peer group of publicly traded homebuilders
(primarily Beazer Homes USA, Inc.; D.R. Horton, Inc.; Hovnanian
Enterprises, Inc.; KB Home; M.D.C. Holdings, Inc.; NVR, Inc.;
PulteGroup, Inc.; The Ryland Group, Inc.; Standard Pacific
Corp.; and Toll Brothers, Inc.) and it reviews information about
compensation levels generally paid by Fortune
500 companies. However, the Compensation Committee has not
targeted a particular relationship between our executive
compensation and that of the peer group companies or that of the
Fortune 500 companies or any other group of companies.
Allocations
among various types of compensation
When reviewing and determining the total mix of compensation
allocated between short and long-term awards and between cash
and equity awards to executive officers, we make individual
determinations based upon our compensation objective to combine
competitive base salaries with performance based cash incentives
and equity compensation that we believe will align interests of
senior executives with those of stockholders, rather than
relying on a set formula or percentage allocation. Accordingly,
when we make a compensation
17
award with regard to a particular executive officer, we exercise
judgment in determining the mix of compensation we believe to be
in line with our compensation objectives for that executive.
Compliance
with Internal Revenue Code Section 162(m)
When reviewing and setting compensation awards for our
executives, one of the things we consider is the potential
effect of Section 162(m) of the Internal Revenue Code on
the tax deductibility of their compensation. Section 162(m)
generally does not allow a publicly-held company to deduct
compensation over $1 million paid for any fiscal year to
any of the executive officers required to be named in the
companys annual proxy statement, except for the chief
financial officer. However, Section 162(m) exempts
qualified performance-based compensation if certain requirements
are met. We generally have structured awards to our executive
officers in ways that are intended to qualify for the
performance-based compensation exemption under
Section 162(m). However, we exercise judgment and may award
compensation that does not qualify for tax deductibility under
Section 162(m) in order to meet corporate objectives or to
adapt to changing circumstances.
With regard to fiscal 2009, the Compensation Committee made
restricted stock awards to our chief executive officer, our
executive vice president and our chief operating officer that
caused their compensation to exceed $1 million, but it did
not subject those awards to achievement of performance goals,
even though that meant that Section 162(m) would cause a
portion of those awards not to be deductible. The Compensation
Committee felt that the Company should not subject the awards to
performance goals, because, in view of the uncertainties created
by the unusual state of the homebuilding market, the risk of
loss of the shares that were awarded would significantly reduce
the incentives created by awarding them. For this reason, and
because the Compensation Committee approved the payment of cash
bonuses with regard to 2010 after November 30, 2010, the
cash bonuses were not subject to achievement performance goals.
However, with regard to fiscal 2010, the Compensation Committee
granted restricted stock awards to our named executive officers
on November 30, 2010 of which 25% vested immediately and an
additional 25% would vest on each of the first, second and third
anniversaries of the date of grant. The 75% of the fiscal 2010
restricted stock awards to three of our named executive officers
(chief executive officer, executive vice president and chief
operating officer) that was not immediately vested is subject to
achievement of two of the following four performance goals
during 2010, and therefore should be exempt from
Section 162(m).
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Fiscal year EBITDA greater than $100 million (without
taking account of impairment charges, if any).
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A homebuilding debt to total capital ratio of less than 60%.
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The number of unconsolidated homebuilding joint ventures in
which we were participating at November 30, 2010 and still
are participating at November 30, 2011 being fewer than 40.
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A customer satisfaction rating of at least 8.5 for the four most
recent quarters for which customer satisfaction ratings are
reported prior to November 30, 2011.
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Neither the restricted stock awards granted to the other two of
our named executive officers, nor the cash bonuses awarded to
all of our named executive officers, are subject to performance
goals, and therefore neither the restricted stock awards granted
to the two named executive officers nor the cash compensation
paid to any of our named executive officers, with regard to
fiscal 2010, are exempt from Section 162(m). Cash bonuses
related to fiscal 2011 will be subject to achievement of
performance goals, and therefore should be exempt from
Section 162(m).
Use
of Compensation Survey Data
We use compensation data regarding our peer group of
publicly-traded homebuilding companies to analyze compensation
decisions in light of current market rates and practices, and to
help ensure that our compensation decisions are reasonable in
comparison to the compensation paid by our peer group and the
value of particular
18
executives to the Company. However, we do not target a specific
relationship between our executive compensation and that of the
peer group companies. The peer group compensation data is
generally compiled from publicly available information. The
publicly traded homebuilding companies we view as being in our
peer group are Beazer Homes USA, Inc.; D.R. Horton, Inc.;
Hovnanian Enterprises, Inc.; KB Home; M.D.C. Holdings, Inc.;
NVR, Inc.; PulteGroup, Inc.; The Ryland Group, Inc.; Standard
Pacific Corp.; and Toll Brothers, Inc.
Components
of Compensation
Base
Salary
Base salaries paid to our executive officers serve to provide a
fixed or base level of compensation to them. When reviewing and
setting an executives base salary, we consider these
factors:
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level of experience and responsibility;
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ability to contribute to meeting annual operating objectives;
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level of pay required to retain the executives services in
light of market conditions;
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average base salary of comparable executives in our peer
group; and
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recommendations of our Chief Executive Officer, other than for
himself.
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Due to unfavorable economic conditions with regard to
homebuilding, in 2006, we implemented a salary freeze for
management, which we continued through fiscal 2010. Accordingly,
the base salary of the named executive officers has remained the
same for the last four years, except for our Executive Vice
President. The base salary of our chief executive officer has
remained unchanged since 2003.
When setting base salaries, we do not use a percentage or ratio
that the base salary should be in relation to total
compensation, but we believe that incentive compensation should
continue to be a significant portion of our executives
total compensation.
Stock
Option Grants under the Companys 2007 Equity Incentive
Plan
Stock option grants are typically made to key associates during
the first quarter of a fiscal year after we have had a chance to
evaluate our performance for the prior fiscal year. In addition
to these annual grants, we sometimes grant options to new
associates upon hire or to current associates upon promotion.
Each stock option has an exercise price equal to the closing
price of our stock on the date of grant, is subject to vesting
over a four-year period and expires on the fifth anniversary of
the grant date. We believe that stock options provide an
important incentive for our associates to maximize stockholder
value, because the stock options only have value if our stock
price increases after the date of grant. During our 2009 and
2010 fiscal years, we did not make annual option awards.
In determining the number of shares subject to an option grant,
we make a subjective evaluation of:
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our overall performance as a company;
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an analysis of compensation paid to senior executive officers in
our peer group;
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contributions the executive officer made and is anticipated to
make to our success;
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the executive officers tenure with us;
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the level of experience and responsibility of the executive
officer; and
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the number of stock options previously granted to the executive
officer compared with those previously granted to other
executive officers and associates.
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19
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Restricted
Stock Awards under the Companys 2007 Equity Incentive
Plan
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We sometimes award restricted stock to select members of senior
management. We believe that restricted stock closely aligns the
long-term interests of recipients with those of our
stockholders. Restricted stock grant amounts and other material
terms are approved by the Compensation Committee after receiving
recommendations from our chief executive officer and other
members of our senior management. Restricted stock grants made
to the chief executive officer are determined by the
Compensation Committee.
In determining the number of shares subject to a restricted
stock grant, we make a subjective evaluation of:
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contributions the executive made and is anticipated to make to
our success;
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the executives tenure with us;
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the level of experience and responsibility of the executive;
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the level of stock ownership of the executive; and
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market compensation for similarly-situated executives in our
peer group.
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Our chief executive officer and other members of our senior
management develop grant recommendations by evaluating the
factors above to set a total compensation target for each named
executive officer (other than our chief executive officer) and
then design new grants to accomplish those targets, taking into
account cash compensation and any stock option grants.
On November 30, 2009, the Compensation Committee adopted,
subject to an annual review by the Compensation Committee, a
three year program to make annual awards of restricted stock to
our senior executives. Of the shares issued in a year, 25% vest
upon issuance and an additional 25% will vest on each of the
first, second and third anniversaries of the grant date. All
shares that are not vested at the time a person ceases to be an
employee or officer will be forfeited. The program was adopted,
and shares were awarded with regard to fiscal 2009, in
recognition of the fact that, because of market conditions in
the homebuilding industry, our senior executives had not
received salary increases since fiscal 2006 and no cash bonuses
were paid with regard to fiscal 2008 or 2009. The Compensation
Committee was concerned that when the homebuilding market
recovered and homebuilders began to expand, there would be
aggressive competition for experienced homebuilding executives.
The Compensation Committee felt that the ability of award
recipients immediately to sell up to 25% of the shares they
received would make up in part for the absence of salary
increases and cash bonuses, and the gradual three year vesting
of the remainder of the shares would create a significant
incentive for recipients to continue their employment with the
Company. Fiscal 2010 awards under this program are discussed
under Fiscal 2010 Compensation.
Allocation
between Restricted Stock and Stock Options
In determining how to allocate equity based compensation between
stock options and restricted stock, we consider the following
factors:
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the financial statement expense of issuing restricted stock
versus that of issuing stock options;
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the tax deductibility of restricted stock grants;
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the objective achieved by issuing restricted stock versus that
of issuing stock options; and
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the value to the senior executive of receiving restricted stock
versus stock options.
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We believe that restricted stock provides a strong incentive to
remain with our company despite the uncertain market, because it
has value even during periods of declining stock prices. Also,
because the value of restricted stock reflects the full value of
the shares while the value of stock options reflects only the
potential for an increase in the price of our shares, restricted
stock awards require fewer shares to provide a
20
specified amount of compensation. Amounts realizable from prior
grants are generally not taken into account in determining new
grants.
We do not have any stock ownership guidelines for executive
officers or other associates. However, we do have a policy that
prohibits all associates from trading in puts, calls or similar
options on our stock and from engaging in short sales of our
stock.
Other
Compensation and Benefits
The named executive officers receive vacation, medical, 401(k)
and other benefits that are generally available to all of the
Companys associates.
Fiscal
2010 Compensation
On November 30, 2009, the Compensation Committee adopted,
subject to an annual review by the Compensation Committee, a
three year program to make annual awards of restricted stock to
our senior executives. Of the shares issued in a year, 25% vest
upon issuance and an additional 25% will vest on each of the
first, second and third anniversaries of the grant date. Fiscal
2010 was the second year of the restricted stock program.
Management recommended, and the Compensation Committee approved,
the grant to sixteen members of our senior management, including
all of the named executive officers, the same numbers of
restricted shares they had received with regard to fiscal 2009.
Because our stock price at the end of fiscal 2010 was
approximately 20% higher than it had been at the end of fiscal
2009, this represented a 20% increase in the value of the
restricted stock grants.
Although for many years our compensation program had included
cash bonuses, because our business went through a serious
contraction, and we had operating losses and net losses in 2007,
2008 and 2009, we did not pay cash bonuses in 2008 or 2009 to
any of our named executive officers or to most of the other
members of our senior management.
At the end of fiscal 2010, the Compensation Committee reviewed a
number of our significant accomplishments during the year, and
approved the payment of cash bonuses to various members of our
senior management. The accomplishments during fiscal 2010 were
as follows:
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We returned to profitability beginning in the second quarter of
2010. Based on results reported year to date in the industry, it
appeared that we would be one of a few major homebuilding
companies that were profitable in 2010.
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The housing market worsened during 2010, however we had net
earnings attributable to Lennar of $95.3 million, which was
significantly higher than the Companys 2010 business plan.
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Our focus on construction cost reductions and new community
opportunities resulted in pre-impairment gross margins of more
than 20%, among the highest in the industry.
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We invested in new homebuilding opportunities with expected
margins above our average. In 2010, we purchased a total of
approximately 12,000 new homesites for more than
$500 million.
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We increased our community count by 13% during 2010.
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We reduced selling, general and administrative costs as a
percentage of home sale revenues by approximately 200 basis
points.
|
|
|
|
We reduced corporate general and administrative expenses by 20%.
|
|
|
|
We raised $1.1 billion of new capital:
|
|
|
|
|
1.
|
$723 million of convertible notes
|
|
|
2.
|
$250 million of senior notes
|
|
|
3.
|
$125 million of bank financing
|
21
|
|
|
|
|
In February 2010, we terminated our revolving credit facility
and replaced it with cash collateralized letter of credit
facilities, resulting in savings to the Company. In November
2010, we established a new unsecured letter of credit facility
with favorable covenants, which released approximately
$120 million of restricted cash.
|
|
|
|
We established a new business segment, our Rialto Investments
segment, to take advantage of distressed real estate or mortgage
related opportunities; and we invested more than
$500 million in Rialto opportunities, which were accretive.
|
|
|
|
We further reduced our joint venture exposure:
|
|
|
|
|
1.
|
We reduced the number of joint ventures from 61 to 42.
|
|
|
2.
|
We reduced the maximum joint venture debt with possible recourse
against us from $288 million to $173 million.
|
|
|
3.
|
We extended the maturities of 13 joint venture loans with
outstanding balances totaling approximately $500 million.
|
|
|
|
|
|
We successfully resolved many significant legal cases.
|
|
|
|
We successfully recovered $61.2 million under our insurance
coverage and through third-party recoveries relative to the
costs we had incurred related to the homes confirmed and
estimated to have defective Chinese drywall.
|
In view of these accomplishments, our Compensation Committee
approved cash bonuses with regard to fiscal 2010 for various of
our senior management, including each of the named executive
officers. Because the decision to pay these cash bonuses was not
made until after fiscal 2010 had ended, the cash bonuses were
fixed amounts, rather than based on formulas. However, the
Compensation Committee also approved a fiscal 2011 cash bonus
plan that will base individuals bonuses for that year on
aspects of our performance during that year.
Compensation
of our Chief Executive Officer
With regard to fiscal 2010, Stuart A. Miller, our Chief
Executive Officer, received the same base salary ($1,000,000)
that he had received each year since 2003. In addition, in
accordance with the three year annual award program approved by
the Compensation Committee in 2009, which is subject to annual
review by the Compensation Committee, he received
500,000 shares of restricted stock, with grant date fair
value of $7,595,000, of which 25% were immediately vested and an
additional 25% would vest on each of the first, second and third
anniversaries of the date of grant. For fiscal 2010,
Mr. Miller also received a cash bonus of $1,000,000. The
75% of the restricted stock that was not immediately vested will
be subject to achievement of performance goals as detailed in
the section of this proxy statement titled Compliance with
Internal Revenue Code Section 162(m) and will be
forfeited unless at least two of those goals are achieved.
The decision regarding Mr. Millers salary (which was
made at the beginning of the year), the number of restricted
shares he would receive and Mr. Millers cash bonus
each was based on the view of the Compensation Committee as to
what would be appropriate compensation in view of
Mr. Millers contributions to our company, without
application of any formula or other objective analytic tool. Our
Compensation Committee also decided that Mr. Miller would
be eligible to receive a cash bonus with regard to fiscal 2011
up to 2% of earnings before income taxes in that year.
Compensation
of our Executive Vice President and our Chief Operating
Officer
Rick Beckwitt, our Executive Vice President (who will become our
President if and when our stockholders approve the bylaw
amendments that are the subject of Proposal 4) and
Jonathan M. Jaffe, a Vice President and our Chief Operating
Officer, each received a base salary of $800,000 for 2010, which
for Mr. Jaffe was the same as the base salary he had
received each year since 2007, and for Mr. Beckwitt
22
represented a $100,000 increase in recognition of the increasing
role he was playing in the management of, and strategic planning
for, the Company. For Mr. Jaffe the base salary is the same
that he had received each year since 2007. In addition, in
accordance with the three year annual award program approved by
the Compensation Committee in 2009, which is subject to an
annual review by the Compensation Committee, each of them
received 250,000 shares of restricted stock, with grant
date fair value of $3,797,500, of which 25% were immediately
vested and an additional 25% would vest on each of the first,
second and third anniversaries of the date of grant. For fiscal
2010, each of them also received a cash bonus of $1,000,000. The
75% of the restricted stock that was not immediately vested will
be subject to achievement of performance goals as detailed in
the section of this proxy statement titled Compliance with
Internal Revenue Code Section 162(m) and will be
forfeited unless at least two of those goals are achieved.
The decisions regarding Mr. Beckwitts and
Mr. Jaffes salaries (which were made at the beginning
of the year), the number of restricted shares each of them would
receive and their cash bonuses each was based on the view of the
Compensation Committee as to what would be appropriate
compensation in view of Mr. Beckwitts and
Mr. Jaffes contributions to our company, without
application of any formula or other objective analytic tool. Our
Compensation Committee also decided that Mr. Beckwitt and
Mr. Jaffe each would be eligible to receive a cash bonus
with regard to fiscal 2011 up to 1% of earnings before income
taxes in that year.
Compensation
of Other Named Executive Officers
Bruce E. Gross, a Vice President and our Chief Financial
Officer, and Diane J. Bessette, a Vice President and our
Treasurer, received the same base salaries ($650,000 as to
Mr. Gross and $350,000 as to Ms. Bessette) that they
had received each year since 2007. In addition, in accordance
with the three year annual award program approved by the
Compensation Committee in 2009, which is subject to an annual
review by the Compensation Committee, Mr. Gross received
75,000 shares of restricted stock, with grant date fair
value of $1,139,250, and Ms. Bessette received
30,000 shares of restricted stock, with grant date fair
value of $455,700, of which 25% were immediately vested and an
additional 25% would vest on each of the first, second and third
anniversaries of the date of grant. For fiscal 2010,
Mr. Gross also received a cash bonus of $325,000 and
Ms. Bessette received a cash bonus of $150,000. The
decisions regarding Mr. Gross and
Ms. Bessettes salaries (which were made at the
beginning of the year), the number of restricted shares each of
them would receive and their cash bonuses was based on the view
of the Compensation Committee as to what would be appropriate
compensation in view of Mr. Grosss and
Ms. Bessettes contributions to our company, without
application of any formula or other analytic tool. Our
Compensation Committee also established formulas for determining
the cash bonuses to which the members of our senior management
would be entitled with regard to fiscal 2011. The formula
applicable to Mr. Gross and Ms. Bessette is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance Levels
|
|
|
|
|
|
|
|
|
|
Target Bonus Opportunity
|
|
|
|
|
|
Percent of
|
|
|
|
|
|
|
Performance Criteria
|
|
|
Target Award
|
|
|
|
Threshold
|
Individual performance Based on annual
performance appraisal determined at the end of the fiscal year
by current supervisor
|
|
|
|
60%
|
|
|
|
Good
Very Good
Excellent
|
|
20%
40%
60%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Governance, Company Policy and Procedure Adherence,
and Internal Audit Evaluation
|
|
|
|
40%
|
|
|
|
Good
Very Good
Excellent
|
|
10%
25%
40%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
|
|
|
|
100%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The target bonus opportunity for Mr. Gross and
Ms. Bessette is 100% and 70%, respectively, of their base
salary. The target bonus opportunity will be adjusted pro-rata
between 0% and 120% based on the extent to which we achieve the
pre-tax income anticipated by our 2011 Business Plan (i.e. 106%
Business Plan achievement would increase the target award to
106% of its original amount, 95% Business Plan achievement would
reduce the target award to 95% of its original amount).
23
Compensation
Committee Report
The Compensation Committee has reviewed and discussed with
management the Companys Compensation Discussion and
Analysis. Based on its reviews and discussions with management,
the Compensation Committee recommended to the Board of Directors
that the Compensation Discussion and Analysis be included in
this Proxy Statement.
Compensation Committee:
Steven L. Gerard, Chairperson;
Sherrill W. Hudson;
R. Kirk Landon
24
Summary
Compensation Table
The following table sets forth compensation information for our
last three fiscal years with regard to (i) our principal
executive officer, (ii) our principal financial officer and
(iii) our other three most highly compensated executive
officers during fiscal 2010, to whom we refer collectively as
the named executive officers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonqualified
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
Deferred
|
|
All Other
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
Option
|
|
Incentive Plan
|
|
Compensation
|
|
Compensation
|
|
|
|
|
|
|
Name and Principal Position
|
|
Year
|
|
Salary($)
|
|
Awards($)(1)
|
|
Awards ($)(1)
|
|
Compensation($)
|
|
Earnings($)
|
|
($)(3)
|
|
Total($)
|
|
|
|
|
|
Stuart A. Miller,
|
|
|
2010
|
|
|
|
1,000,000
|
|
|
|
7,595,000
|
|
|
|
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
68,230
|
|
|
|
9,663,230
|
|
|
|
|
|
|
|
|
|
President and Chief Executive Officer
|
|
|
2009
|
|
|
|
1,000,000
|
|
|
|
6,335,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,857
|
|
|
|
7,367,857
|
|
|
|
|
|
|
|
|
|
|
|
|
2008
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
58,294
|
|
|
|
1,058,294
|
|
|
|
|
|
|
|
|
|
Jonathan M. Jaffe,
|
|
|
2010
|
|
|
|
800,000
|
|
|
|
3,797,500
|
|
|
|
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
63,384
|
|
|
|
5,660,884
|
|
|
|
|
|
|
|
|
|
Vice President and
|
|
|
2009
|
|
|
|
800,000
|
|
|
|
3,167,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,331
|
|
|
|
4,007,831
|
|
|
|
|
|
|
|
|
|
Chief Operating Officer
|
|
|
2008
|
|
|
|
800,000
|
|
|
|
1,850,000
|
|
|
|
1,920,000
|
|
|
|
|
|
|
|
|
|
|
|
122,045
|
|
|
|
4,692,045
|
|
|
|
|
|
|
|
|
|
Rick Beckwitt,
|
|
|
2010
|
|
|
|
800,000
|
|
|
|
3,797,500
|
|
|
|
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
66,122
|
|
|
|
5,663,622
|
|
|
|
|
|
|
|
|
|
Executive Vice President
|
|
|
2009
|
|
|
|
700,000
|
|
|
|
3,167,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37,364
|
|
|
|
3,904,864
|
|
|
|
|
|
|
|
|
|
|
|
|
2008
|
|
|
|
700,000
|
|
|
|
1,850,000
|
|
|
|
1,920,000
|
|
|
|
|
|
|
|
|
|
|
|
112,592
|
|
|
|
4,582,592
|
|
|
|
|
|
|
|
|
|
Bruce E. Gross,
|
|
|
2010
|
|
|
|
650,000
|
|
|
|
1,139,250
|
|
|
|
|
|
|
|
325,000
|
|
|
|
|
|
|
|
31,630
|
|
|
|
2,145,880
|
|
|
|
|
|
|
|
|
|
Vice President and
|
|
|
2009
|
|
|
|
650,000
|
|
|
|
950,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,030
|
|
|
|
1,629,280
|
|
|
|
|
|
|
|
|
|
Chief Financial Officer
|
|
|
2008
|
|
|
|
650,000
|
|
|
|
|
|
|
|
960,000
|
|
|
|
|
|
|
|
|
|
|
|
82,790
|
|
|
|
1,692,790
|
|
|
|
|
|
|
|
|
|
Diane J. Bessette,
|
|
|
2010
|
|
|
|
350,000
|
|
|
|
455,700
|
|
|
|
|
|
|
|
150,000
|
|
|
|
|
|
|
|
26,460
|
|
|
|
982,160
|
|
|
|
|
|
|
|
|
|
Vice President and
Treasurer(2)
|
|
|
2009
|
|
|
|
350,000
|
|
|
|
380,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,260
|
|
|
|
757,360
|
|
|
|
|
|
|
|
|
|
|
|
|
2008
|
|
|
|
350,000
|
|
|
|
925,000
|
|
|
|
153,600
|
|
|
|
|
|
|
|
|
|
|
|
71,190
|
|
|
|
1,499,790
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
For fiscal 2010, 2009 and 2008
these columns represent the grant date fair values of awards,
calculated using the end of day closing stock price of
Lennars Class A common stock on the grant date for
stock awards and using the Black-Scholes option-pricing model
for option awards, which is different from the amounts
recognized for financial statement reporting purposes during
those fiscal years. Further information regarding the
assumptions used in the calculation of the grant date fair
values of stock and option awards can be found in Note 13
of the Consolidated Financial Statements in our Annual Report on
Form 10-K
for the year ended November 30, 2010. Stock awards granted
in 2010 to Mr. Miller, Mr. Jaffe and Mr. Beckwitt
are performance based awards as to the 75% that have not vested
as of November 30, 2010.
|
|
(2)
|
|
Prior to February 21, 2008,
Ms. Bessette was Vice President and Controller.
|
|
(3)
|
|
All other compensation consists of
dividends on restricted stock awards that were not factored in
calculating the grant date fair value of the awards, car
allowances provided or car lease payments made by us on behalf
of certain executives, matching payments by us under the 401(k)
Plan, term life insurance premiums paid by us and long-term
disability insurance premiums paid by us as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Car
|
|
|
|
|
|
Long-Term
|
|
|
|
|
|
|
|
|
Allowance/Lease
|
|
401(k)
|
|
Term Life
|
|
Disability
|
|
Total All Other
|
|
|
Year
|
|
Dividends($)
|
|
Payments($)
|
|
Match($)
|
|
Insurance($)
|
|
Insurance($)
|
|
Compensation($)
|
|
Stuart A. Miller
|
|
|
2010
|
|
|
|
60,000
|
|
|
|
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
68,230
|
|
|
|
|
2009
|
|
|
|
2,400
|
|
|
|
22,227
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
32,857
|
|
|
|
|
2008
|
|
|
|
25,200
|
|
|
|
25,304
|
|
|
|
6,900
|
|
|
|
440
|
|
|
|
450
|
|
|
|
58,294
|
|
Jonathan M. Jaffe
|
|
|
2010
|
|
|
|
39,000
|
|
|
|
16,154
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
63,384
|
|
|
|
|
2009
|
|
|
|
15,600
|
|
|
|
16,501
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
40,331
|
|
|
|
|
2008
|
|
|
|
97,700
|
|
|
|
16,555
|
|
|
|
6,900
|
|
|
|
440
|
|
|
|
450
|
|
|
|
122,045
|
|
Rick Beckwitt
|
|
|
2010
|
|
|
|
40,200
|
|
|
|
17,692
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
66,122
|
|
|
|
|
2009
|
|
|
|
18,000
|
|
|
|
11,134
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
37,364
|
|
|
|
|
2008
|
|
|
|
88,000
|
|
|
|
16,802
|
|
|
|
6,900
|
|
|
|
440
|
|
|
|
450
|
|
|
|
112,592
|
|
Bruce E. Gross
|
|
|
2010
|
|
|
|
15,000
|
|
|
|
8,400
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
31,630
|
|
|
|
|
2009
|
|
|
|
12,400
|
|
|
|
8,400
|
|
|
|
7,350
|
|
|
|
430
|
|
|
|
450
|
|
|
|
29,030
|
|
|
|
|
2008
|
|
|
|
66,600
|
|
|
|
8,400
|
|
|
|
6,900
|
|
|
|
440
|
|
|
|
450
|
|
|
|
82,790
|
|
Diane J. Bessette
|
|
|
2010
|
|
|
|
11,100
|
|
|
|
7,200
|
|
|
|
7,350
|
|
|
|
360
|
|
|
|
450
|
|
|
|
26,460
|
|
|
|
|
2009
|
|
|
|
11,900
|
|
|
|
7,200
|
|
|
|
7,350
|
|
|
|
360
|
|
|
|
450
|
|
|
|
27,260
|
|
|
|
|
2008
|
|
|
|
56,200
|
|
|
|
7,200
|
|
|
|
6,900
|
|
|
|
440
|
|
|
|
450
|
|
|
|
71,190
|
|
25
Grants
of Plan-Based Awards
The following table sets forth information about the plan-based
awards that were granted to our named executive officers during
fiscal 2010:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated Future
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payouts Under
|
|
Exercise or
|
|
Grant Date Fair
|
|
|
|
|
Estimated Future Payouts Under
|
|
Equity Incentive
|
|
Base Price of
|
|
Value of Stock
|
|
|
Grant
|
|
Non-Equity Incentive Plan Awards(1)
|
|
Plan Awards
|
|
Option
|
|
and Option
|
Name
|
|
Date
|
|
Threshold($)
|
|
Target($)
|
|
Maximum($)
|
|
Target(#)(2)
|
|
Awards($)
|
|
Awards ($)(3)
|
|
Stuart A. Miller(4)
|
|
|
11/30/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
500,000
|
|
|
|
|
|
|
|
7,595,000
|
|
Jonathan M. Jaffe(4)
|
|
|
11/30/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
250,000
|
|
|
|
|
|
|
|
3,797,500
|
|
Rick Beckwitt(4)
|
|
|
11/30/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
250,000
|
|
|
|
|
|
|
|
3,797,500
|
|
Bruce E. Gross
|
|
|
11/30/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
75,000
|
|
|
|
|
|
|
|
1,139,250
|
|
Diane J. Bessette
|
|
|
11/30/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000
|
|
|
|
|
|
|
|
455,700
|
|
|
|
|
(1)
|
|
No threshold, target or maximum
bonus amounts were established for any of the named executed
officers with regard to fiscal 2010.
|
|
(2)
|
|
The restricted stock awards granted
on November 30, 2010 were 25% vested when they were granted
and vest with regard to an additional 25% on each of the first
three anniversaries of the grant date. Holders are entitled to
the dividends on, and can vote, the unvested shares.
|
|
(3)
|
|
The grant date fair value of the
restricted stock awards granted on November 30, 2010 was
calculated based on the closing price of our Class A common
stock on that date, which was $15.19 per share.
|
|
(4)
|
|
Of the restricted stock awards
granted on November 30, 2010, 75% will not vest unless
performance goals are achieved in 2011.
|
26
Outstanding
Equity Awards at Fiscal Year-End
The following table shows information about outstanding equity
awards at November 30, 2010:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
Market
|
|
Equity Incentive
|
|
Plan Awards:
|
|
|
Number of
|
|
Number of
|
|
|
|
|
|
Number of
|
|
Value of
|
|
Plan Awards:
|
|
Market or Payout
|
|
|
Securities
|
|
Securities
|
|
|
|
|
|
Shares or
|
|
Shares or
|
|
Number of
|
|
Value of Unearned
|
|
|
Underlying
|
|
Underlying
|
|
|
|
|
|
Units of
|
|
Units of
|
|
Unearned Shares,
|
|
Shares, Units or
|
|
|
Unexercised
|
|
Unexercised
|
|
Option
|
|
|
|
Stock That
|
|
Stock That
|
|
Units or Other
|
|
Other Rights That
|
|
|
Options
|
|
Options
|
|
Exercise
|
|
Option
|
|
Have Not
|
|
Have Not
|
|
Rights That Have
|
|
Have Not
|
Name
|
|
Exercisable
|
|
Unexercisable
|
|
Price
|
|
Expiration Date
|
|
Vested
|
|
Vested(12)
|
|
Not Vested
|
|
Vested(12)
|
|
Stuart A. Miller
|
|
|
9,030
|
|
|
|
|
|
|
$
|
18.32
|
|
|
|
3/6/2011(1
|
)
|
|
|
250,000(3
|
)
|
|
$
|
3,797,500
|
|
|
|
375,000(4
|
)
|
|
$
|
5,696,250
|
|
|
|
|
16,202
|
|
|
|
|
|
|
$
|
26.32
|
|
|
|
1/25/2012(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,190
|
|
|
|
|
|
|
$
|
68.9425
|
|
|
|
1/5/2011(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
196,810
|
|
|
|
|
|
|
$
|
62.675
|
|
|
|
1/5/2011(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
903
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
3/6/2011(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,620
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
1/25/2012(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jonathan M. Jaffe
|
|
|
20,000
|
|
|
|
|
|
|
$
|
18.32
|
|
|
|
3/6/2011(1
|
)
|
|
|
175,000(6
|
)
|
|
$
|
2,658,250
|
|
|
|
187,500(7
|
)
|
|
$
|
2,848,125
|
|
|
|
|
4,000
|
|
|
|
|
|
|
$
|
26.32
|
|
|
|
1/25/2012(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
|
$
|
62.675
|
|
|
|
1/5/2011(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
250,000
|
|
|
|
250,000
|
|
|
$
|
13.54
|
|
|
|
7/23/2013(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,000
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
3/6/2011(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
400
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
1/25/2012(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rick Beckwitt
|
|
|
50,000
|
|
|
|
|
|
|
$
|
59.29
|
|
|
|
3/1/2011(1
|
)
|
|
|
175,000(6
|
)
|
|
$
|
2,658,250
|
|
|
|
187,500(7
|
)
|
|
$
|
2,848,125
|
|
|
|
|
250,000
|
|
|
|
250,000
|
|
|
$
|
13.54
|
|
|
|
7/23/2013(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bruce E. Gross
|
|
|
11,498
|
|
|
|
|
|
|
$
|
18.32
|
|
|
|
3/6/2011(1
|
)
|
|
|
123,750(9
|
)
|
|
$
|
1,879,763
|
|
|
|
|
|
|
|
|
|
|
|
|
18,000
|
|
|
|
|
|
|
$
|
26.32
|
|
|
|
1/25/2012(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
|
$
|
62.675
|
|
|
|
1/5/2011(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
125,000
|
|
|
|
125,000
|
|
|
$
|
13.54
|
|
|
|
7/23/2013(8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,149
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
3/6/2011(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,800
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
1/25/2012(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diane J. Bessette
|
|
|
14,000
|
|
|
|
|
|
|
$
|
18.32
|
|
|
|
3/6/2011(1
|
)
|
|
|
77,500(11
|
)
|
|
$
|
1,177,225
|
|
|
|
|
|
|
|
|
|
|
|
|
14,000
|
|
|
|
|
|
|
$
|
26.32
|
|
|
|
1/25/2012(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000
|
|
|
|
|
|
|
$
|
62.675
|
|
|
|
1/5/2011(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
20,000
|
|
|
$
|
13.54
|
|
|
|
7/23/2013(10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,400
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
3/6/2011(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,400
|
|
|
|
|
|
|
$
|
0.00
|
|
|
|
1/25/2012(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Stock option awards for shares of
Class A common stock.
|
(2)
|
|
Represents shares of Class B
common stock to be issued upon the exercise of certain options
to purchase Class A common stock.
|
(3)
|
|
Reflects a restricted stock award
on November 30, 2009 of shares of Class A common
stock, the unvested portion of which vests as to
125,000 shares on each of November 30, 2011, and
November 30, 2012, assuming continued employment.
|
(4)
|
|
Reflects a performance based
restricted stock award on November 30, 2010 of shares of
Class A common stock, the unvested portion of which vests
as to 125,000 shares on each of November 30, 2011,
November 30, 2012 and November 30, 2013, assuming
performance goals are met in 2011 and continued employment.
|
(5)
|
|
Stock option awards relating to
500,000 shares of Class A common stock, the unvested
portion of which vests as to 125,000 shares on each of
July 23, 2011, and July 23, 2012, assuming continued
employment.
|
(6)
|
|
Reflects a restricted stock award
on January 28, 2008 of 100,000 shares of Class A
common stock, the unvested portion of which vested as to
25,000 shares on January 28, 2011 and vests as to
25,000 shares on January 28, 2012, assuming continued
employment and a restricted stock award on November 30,
2009 of shares of Class A common stock, the unvested
portion of which vests as to 62,500 shares on each of
November 30, 2011, and November 30, 2012, assuming
continued employment.
|
(7)
|
|
Reflects a performance based
restricted stock award on November 30, 2010 of shares of
Class A common stock, the unvested portion of which vests
as to 62,500 shares on each of November 30, 2011,
November 30, 2012 and November 30, 2013, assuming
performance goals are met in 2011 and continued employment.
|
(8)
|
|
Stock option awards relating to
250,000 shares of Class A common stock, the unvested
portion of which vests as to 62,500 shares on each of
July 23, 2011, and July 23, 2012, assuming continued
employment.
|
(9)
|
|
Reflects a restricted stock award
on February 27, 2007 of shares of Class A common
stock, the unvested portion of which vests as to
30,000 shares on February 27, 2011, a restricted stock
award on November 30, 2009 of shares of Class A common
stock, the unvested portion of which vests as to
18,750 shares on each of November 30, 2011, and
November 30, 2012 and a restricted stock award on
November 30, 2010 of shares of Class A common stock,
the unvested portion of which vests as to 18,750 shares on
each of November 30, 2011, November 30, 2012 and
November 30, 2013, assuming continued employment.
|
(10)
|
|
Stock option awards relating to
40,000 shares of Class A common stock, the unvested
portion of which vests as to 10,000 shares on each of
July 23, 2011, and July 23, 2012, assuming continued
employment.
|
(11)
|
|
Reflects a restricted stock award
on February 27, 2007 of shares of Class A common
stock, the unvested portion of which vests as to
15,000 shares on February 27, 2011, a restricted stock
award on January 28, 2008 of 50,000 shares of
Class A common stock, the unvested portion of which vested
as to 12,500 shares on January 28, 2011 and vests as
to 12,500 shares on January 28, 2012, a restricted
stock award on November 30, 2009 of 30,000 shares of
Class A common stock, the unvested portion of which vests
as to
|
27
|
|
|
|
|
7,500 on each of November 30,
2011 and November 30, 2012 and a restricted stock award on
November 30, 2010 of shares of Class A common stock,
the unvested portion of which vests as to 7,500 shares on
each of November 30, 2011, November 30, 2012 and
November 30, 2013, assuming continued employment.
|
(12)
|
|
Market value of shares or units of
stock that have not vested and unearned shares, units or other
rights that have not vested is calculated using the closing
sales price of the Class A common stock on
November 30, 2010, which was the last trading day of the
fiscal year. At November 30, 2010, the closing sales price
was $15.19 per share.
|
Option
Exercises and Stock Vested
The following table sets forth information about option
exercises and stock vested during fiscal 2010:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
Number of Shares
|
|
Value
|
|
Number of Shares
|
|
Value
|
|
|
Acquired on
|
|
Realized on
|
|
Acquired on
|
|
Realized on
|
Name
|
|
Exercise(#)
|
|
Exercise($)
|
|
Vesting (#)(1)
|
|
Vesting ($)
|
|
Stuart A. Miller
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock
|
|
|
20,000
|
|
|
|
119,699
|
|
|
|
250,000
|
|
|
|
3,797,500
|
|
Class B Common Stock
|
|
|
2,000
|
|
|
|
22,760
|
|
|
|
|
|
|
|
|
|
Jonathan M. Jaffe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock
|
|
|
5,998
|
|
|
|
47,354
|
|
|
|
150,000
|
|
|
|
2,283,500
|
|
Class B Common Stock
|
|
|
599
|
|
|
|
7,568
|
|
|
|
|
|
|
|
|
|
Rick Beckwitt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock
|
|
|
|
|
|
|
|
|
|
|
180,000
|
|
|
|
2,780,150
|
|
Class B Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bruce E. Gross
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock
|
|
|
|
|
|
|
|
|
|
|
67,500
|
|
|
|
1,066,275
|
|
Class B Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diane J. Bessette
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A Common Stock
|
|
|
7,602
|
|
|
|
58,916
|
|
|
|
42,500
|
|
|
|
668,550
|
|
Class B Common Stock
|
|
|
760
|
|
|
|
9,603
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Includes shares awarded
November 30, 2010 that vested upon issuance.
|
Nonqualified
Defined Contribution and Other Nonqualified Deferred
Compensation Plans
We did not have a deferred compensation plan, and no named
executive officers deferred any compensation during fiscal 2010.
Compensatory
Plans and Arrangements
Equity
Plans
We have a 2007 Equity Incentive Plan that provides for the
granting of up to 15,000,000 shares of Class A or
Class B common stock that may be issuable upon the exercise
of stock options or stock appreciation rights, or that may be
awarded as shares of restricted common stock or other forms of
share based awards, to key officers, associates and Directors.
The exercise prices of stock options and stock appreciation
rights may not be less than the fair market value of the
applicable class of common stock on the date of the grant.
Options granted under the 2007 Plan become exercisable at the
time or times determined when the options are granted. Each
stock option and stock appreciation right will expire on a date
determined at the time of the grant, but not more than ten years
after the date of the grant.
Since we adopted the 2007 Equity Incentive Plan, it has been the
only plan under which we have made equity-based awards to key
officers, associates and Directors. The prior plan (the Lennar
Corporation 2003 Stock Option and Restricted Stock Plan)
terminated when the 2007 Equity Plan was adopted. However, some
awards made under it or under our 2000 Stock Option and
Restricted Stock Plan are still outstanding.
28
The Lennar Corporation 2003 Stock Option and Restricted Stock
Plan provided for the granting of Class A or Class B
stock options and stock appreciation rights and awards of
restricted stock to key officers, associates and Directors. No
options granted under the 2003 Plan could be exercised until at
least six months after the date of the grant. Thereafter,
options became exercisable in installments determined when
options were granted. Each stock option and stock appreciation
right will expire on a date determined at the time of the grant,
but not more than ten years after the date of the grant.
Restricted stock grants could not vest earlier than six months
after the date of issuance.
The Lennar Corporation 2000 Stock Option and Restricted Stock
Plan provided for the granting of stock options and stock
appreciation rights relating to Class A common stock and
awards of restricted Class A common stock to key officers,
associates and Directors. No options granted under the 2000 Plan
could be exercised until at least six months after the date of
the grant. Thereafter, options became exercisable in
installments determined when options were granted. Each stock
option and stock appreciation right expires on a date determined
at the time of the grant, but not more than ten years after the
date of the grant. Restricted stock grants vested over vesting
periods determined at the time of the grants.
Incentive
Compensation Plan
We have a 2007 Incentive Compensation Plan under which the
Compensation Committee of our Board of Directors, or a
subcommittee of the Compensation Committee, can establish (or
delegate to members of our management, the authority to
establish) performance goals for our and our subsidiaries
officers and key associates and determine formulae on the basis
of which bonuses will be awarded to those officers and key
associates based upon the extent to which they achieve those
performance goals. The formula for a person may relate to how we
or a subsidiary, division or other operating unit performs, or
how it performs compared with other companies or indexes.
Possible performance criteria include, among other things,
pre-tax income, after-tax income, per share net income,
operating income, return on equity, return on invested capital,
stock appreciation, reductions in operating costs, customer
satisfaction ratings, number of homes sold or number of
mortgages originated.
Compensation
Committee Interlocks and Insider Participation
During fiscal 2010, Messrs. Gerard, Landon and Hudson
served on our Compensation Committee. Mr. Bolotin, who
served on the Compensation Committee from January 2002 to April
2010, was our Senior Vice President until his retirement in
December 1998. During fiscal 2010, none of our executive
officers served on the compensation committee or the board of
any other entity of which a member of our Compensation Committee
was an executive officer or on the compensation committee of any
entity of which any of our directors was an executive officer.
Certain
Relationships and Related Transactions
Related
Party Transactions Policies and Procedures
Our policy, included in our Code of Business Conduct and Ethics,
is that all directors, officers and associates must avoid any
activity that does or appears to conflict with the interests of
the Company. Our directors, officers and associates are aware of
the applicable provisions of our Code of Business Conduct and
Ethics, and we seek to become aware of related party
transactions through periodic reviews by, and notifications to,
management, including the completion of an annual Questionnaire
for Directors and Executive Officers. We conduct a review of all
related party transactions for potential conflicts of interest.
Any potential conflicts of interest must be reviewed and
approved, if applicable, by our Conflicts Committee if the
person involved is someone other than a director or our chief
executive officer or, if the person involved is a director or
our chief executive officer, by the Audit Committee of the Board
of Directors. Our Conflicts Committee consists of our Chief
Financial Officer, our Principal Accounting Officer and our
General Counsel. During
29
fiscal 2010, there were no transactions with related persons
which our policies and procedures did not require to be
reviewed, approved or ratified or regarding which our policies
and procedures were not followed.
Relationship
with LNR Property Corporation
In 1997, we transferred our commercial real estate investment
and management business to LNR Property Corporation, and
spun-off LNR to our stockholders. As a result, LNR became a
publicly-traded company, and the family of Stuart A. Miller, our
President, Chief Executive Officer and a Director, which had
voting control of us, became the controlling shareholder of LNR.
Since the spin-off, we have entered into a number of joint
ventures and other transactions with LNR. Many of the joint
ventures were formed to acquire and develop land, part of which
was subsequently sold to us or other homebuilders for
residential building and part of which was subsequently sold to
LNR for commercial development. In February 2005, LNR was
acquired by a company formed by a private equity investment
group. Although Mr. Millers family was required to
purchase a 20.4% minority interest in the acquiring company,
that interest was non-voting and neither Mr. Miller nor
anyone else in his family was an officer or director, or
otherwise was involved in the management, of LNR or its parent.
Nonetheless, because the Miller family had a significant
minority interest in LNRs parent, significant transactions
with LNR, or entities in which it had an interest, continued to
be reviewed and subject to approval by the Independent Directors
Committee of our Board of Directors.
In January 2004, a company of which we and LNR each owned 50%
acquired The Newhall Land and Farming Company for approximately
$1 billion, including $200 million we contributed and
$200 million that LNR contributed (the remainder came from
borrowings and proceeds of sales of properties to LNR).
Subsequently, we and LNR each transferred our interests in most
of our joint ventures to the jointly-owned company that had
acquired The Newhall Land and Farming Company, and that company
was renamed LandSource Communities Development LLC
(LandSource). At that time, The Newhall Land and
Farming Company owned approximately 35,000 acres in
California, much of which was in Los Angeles county.
In February 2007, LandSource admitted MW Housing Partners as a
new strategic partner. As part of the transaction, each of
Lennar and LNR received a cash distribution of
$707.6 million and each of their ownership interests in
LandSource was reduced to 16%. As a result of their 20.4%
interest in LNRs parent, the Miller family had an indirect
interest in the sum paid to LNR in the LandSource transaction of
approximately $144.4 million.
In June 2008, LandSource and a number of its subsidiaries
commenced proceedings under Chapter 11 of the Bankruptcy
Code. In July 2009, as a result of the bankruptcy proceedings,
LandSource was reorganized into a new company named Newhall Land
Development, LLC, (Newhall). The reorganized company
emerged from Chapter 11 free of its previous bank debt. As
part of the reorganization, we invested $140 million in
exchange for approximately a 15% equity interest in the
reorganized Newhall, ownership in several communities that were
formerly owned by LandSource, the settlement and release of any
claims that might have been asserted against us and assignment
to us of certain claims LandSource had against third parties,
including LNR. LNR is not a member of Newhall, the reorganized
company.
During 2010, LNR and its parent underwent debt and equity
restructurings, as a result of which the Miller family interest
in LNRs parent was reduced from its prior level. Despite
this reduction, significant transactions with LNR, or entities
in which it has an interest, continued to be reviewed and
subject to approval by the Independent Directors Committee of
our Board of Directors.
Aircraft
Time-Sharing Agreements
In August 2005, Stuart Miller, our President and Chief Executive
Officer, entered into a Time-Sharing Agreement with one of our
subsidiaries which provides that Mr. Miller can
sub-lease an
aircraft leased by that subsidiary for non-business purposes.
Under that Agreement, Mr. Miller pays the subsidiary, out
of a prepayment fund established in connection with the
agreement, the aggregate incremental cost of each flight
30
based on a list of expenses authorized by federal regulations.
The subsidiary retains sole discretion to determine what flights
may be scheduled by Mr. Miller, and under the Agreement the
Companys prior planned use of the aircraft takes
precedence over Mr. Millers non-business use.
Mr. Miller paid our subsidiary $106,000 under the agreement
for his use of the aircraft during fiscal 2010 (the cost
reimbursed by Mr. Miller was calculated in accordance with
Federal Aviation Administration regulations).
In January 2011, Rick Beckwitt, our Executive Vice President
(who will become our President if and when the amendments to
Sections 7.1 through 7.4 of our Bylaws described in
Proposal 4 are approved by our stockholders) entered into a
Time-Sharing Agreement with our subsidiary which provides that
Mr. Beckwitt can
sub-lease a
second aircraft leased by that subsidiary for non-business
purposes. The terms of that Time-Sharing Agreement are
essentially the same as those in the Time-Sharing Agreement
between the subsidiary and Mr. Miller.
Aircraft
Dry Lease Agreement
In addition to reimbursing the Company for personal use of the
aircraft, in February 2009, Mr. Miller entered into an
Amended and Restated Aircraft Dry Lease Agreement with the
Company and a subsidiary that, under Federal Aviation
Administration rules, permits Mr. Miller, at his option, to
pay on behalf of the Company the full cost of all use and
ownership of the aircraft, including business use, which he did
by paying us $3.4 million in fiscal 2009. There were no
reimbursements in fiscal 2010. Our independent Directors
approved the Amended and Restated Agreement. Federal Aviation
Administration rules did not permit Mr. Miller to reimburse
the Company for business use of the aircraft under his 2005
Aircraft Time-Sharing Agreement.
Section 16(a)
Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934
requires our Directors, officers and persons who own more than
10% of a registered class of our equity securities to file
reports of ownership and changes in ownership of such securities
with the Securities and Exchange Commission. They are required
to furnish us with copies of the reports they file pursuant to
Section 16(a). Based on our review of the copies of reports
we have received, we believe that during fiscal 2010, our
Directors, officers and greater than 10% beneficial owners made
all required filings on a timely basis.
Independent
Registered Public Accounting Firm
Deloitte & Touche LLP audited our financial statements
for our fiscal year ended November 30, 2010.
Deloitte & Touche LLP has been our independent
registered public accounting firm since fiscal 1994 and our
Audit Committee has selected them as our independent registered
public accounting firm for fiscal 2011. In
Proposal 6, Ratification of Selection of Independent
Registered Public Accounting Firm, our stockholders are
being asked to ratify the selection of Deloitte &
Touche LLP as our independent registered public accounting firm
for fiscal 2011. As is described under the discussion of
Proposal 6, if our stockholders do not ratify that
selection, the effect of that will be to cause the Audit
Committee to reconsider whether or not to retain that firm as
our independent registered public accountants.
We expect representatives of Deloitte & Touche LLP to
be present at our 2011 Annual Meeting of Stockholders. These
representatives will have the opportunity to make a statement if
they desire to do so, and are expected to be available to
respond to appropriate questions.
31
The fees billed by Deloitte & Touche LLP, the member
firms of Deloitte Touche Tohmatsu, and their respective
affiliates (collectively, Deloitte), for various
types of professional services and related expenses during the
years ended November 30, 2010 and 2009 were as follows:
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|
|
|
|
|
|
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|
Fees during
|
|
|
Fees during
|
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|
the year ended
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|
|
the year ended
|
|
Type of Services
|
|
November 30, 2010
|
|
|
November 30, 2009
|
|
|
Audit Fees
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|
$
|
3,161,000
|
|
|
$
|
2,037,000
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|
Audit-related Fees
|
|
$
|
479,000
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|
|
$
|
69,000
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|
Tax Fees
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|
$
|
465,000
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|
|
$
|
600,000
|
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All Other Fees
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|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
Total
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|
$
|
4,105,000
|
|
|
$
|
2,706,000
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|
|
|
|
|
|
|
|
|
|
Audit services include the audit of our annual financial
statements, reviews of our quarterly financial information and
consents and comfort letters. Audit-related services primarily
include assistance in understanding and applying financial
accounting and reporting standards and accounting assistance
with regard to proposed transactions. Tax services are tax
planning, tax compliance services and tax return preparation.
All other fees are fees that do not fall into the specific types
of services.
Audit
Committee Pre-Approval Policy
The Audit Committee Charter requires that the Audit Committee
pre-approve all auditing services (including providing comfort
letters in connection with securities offerings) and non-audit
services (including tax services) provided to us or our
subsidiaries by our independent registered public accounting
firm, except for non-audit services covered by a de minimus
exception in Section 10A of the Securities Exchange Act of
1934. During fiscal 2010, the Audit Committee pre-approved all
services provided by Deloitte.
Auditor
Independence
Our Audit Committee has been informed of the types of services
that Deloitte has provided to us and has determined that
Deloittes providing those services to us is compatible
with Deloitte maintaining its independence from us.
32
The following statement is furnished by the Audit Committee
of Lennar Corporation and is not to be incorporated by reference
into any document that we file with the Securities and Exchange
Commission.
Management has the primary responsibility for producing the
Companys financial statements and for implementing the
Companys financial reporting process, including the
Companys system of internal control over financial
reporting. The independent registered public accounting firm is
responsible for performing an independent audit of the
Companys financial statements in accordance with the
standards of the Public Company Accounting Oversight Board
(United States) (PCAOB) and issuing a report
thereon. The Audit Committees responsibility is to assist
the Board of Directors in its oversight of the Companys
financial statements. In fulfilling its oversight
responsibilities, the Audit Committee reviewed the
Companys audited financial statements for the year ended
November 30, 2010 with management, including a discussion
of the quality, not just the acceptability, of accounting
principles, the reasonableness of significant judgments and the
clarity of disclosures in the financial statements.
During the course of fiscal 2010, management undertook the
testing and evaluation of the Companys system of internal
control over financial reporting in response to the requirements
set forth in Section 404 of the Sarbanes-Oxley Act and
related regulations. The Audit Committee was kept apprised of
the progress of the evaluation and provided oversight and advice
to management during the process. In connection with this
oversight, the Audit Committee received periodic updates
provided by management and Deloitte & Touche LLP at
each Audit Committee meeting. At the conclusion of the process,
the Audit Committee reviewed the report of management contained
in the Companys Annual Report on
Form 10-K
for the fiscal year ended November 30, 2010 that has been
filed with the Securities and Exchange Commission, as well as
Deloitte & Touche LLPs Reports of Independent
Registered Public Accounting Firm included in the Companys
Annual Report on
Form 10-K
related to its audits of: (i) the consolidated financial
statements and schedule thereto and (ii) the effectiveness
of internal control over financial reporting. The Audit
Committee continues to oversee the Companys efforts
related to its internal control over financial reporting and
managements preparations for the evaluation in fiscal 2011.
The Audit Committee has discussed with the Companys
independent registered public accounting firm the matters
required to be discussed by Statement on Auditing Standards
No. 114, The Auditors Communication with those
Charged with Governance. The Audit Committee has received
and reviewed the written disclosures and the letter from the
independent registered public accounting firm required by the
PCAOB Ethics and Independence Rule 3526,
Communication with Audit Committee Concerning
Independence, and has discussed with
Deloitte & Touche LLP the firms independence.
The Audit Committee has also considered whether the providing of
audit-related and other non-audit services by Deloitte to the
Company is compatible with maintaining the firms
independence.
The Audit Committee has evaluated the independent registered
public accounting firms role in performing an independent
audit of the Companys financial statements in accordance
with the standards of the PCAOB and applicable professional and
firm auditing standards, including quality control standards.
The Audit Committee has received assurances from the independent
registered public accounting firm that the audit was subject to
its quality control system for its accounting and auditing
practice in the United States. The independent registered public
accounting firm has further assured the Audit Committee that its
engagement was conducted in compliance with professional
standards and that there was appropriate continuity of personnel
working on the audit and availability of national office
consultation to conduct the relevant portions of the audit.
Based on the reviews and discussions referred to above, the
Audit Committee recommended to the Board of Directors and the
Companys management that the audited financial statements
be included in the Annual Report on
Form 10-K
for the Companys fiscal year ended November 30, 2010
that was filed with the Securities and Exchange Commission. By
recommending to the Board of Directors and the Companys
33
management that the audited financial statements be so included,
the Audit Committee is not opining on the accuracy, completeness
or presentation of the information contained in the audited
financial statements.
Audit Committee:
Sherrill W. Hudson, Chairperson;
Irving Bolotin;
Steven L. Gerard;
R. Kirk Landon
Proposal 1:
Election of Directors
Our Board of Directors, upon recommendation of its Nominating
and Corporate Governance Committee, has designated the nine
persons described in the section of this proxy statement
captioned Board of Directors as nominees for
election as Directors to serve until the next annual meeting of
our stockholders. All of the nominees are currently serving as
Directors of our company. Directors will be elected by a
plurality of the votes cast with regard to the election of
Directors. The persons named in the enclosed proxy will vote the
proxies they receive for the election of all the Board nominees,
except to the extent that a particular proxy withholds
authorization to vote for one or more nominees. Each of the
Board nominees has indicated that he or she is willing and able
to serve as a Director. If, before the Annual Meeting, any
nominee becomes unable to serve, an event that is not
anticipated by the Board of Directors, either the number of
directors constituting the entire Board will be reduced or the
proxies will be voted for the election of a substitute nominee
that the Board of Directors will designate based upon a
recommendation from its Nominating and Corporate Governance
Committee. We provide biographical information about each
nominee for Director in the section of this proxy statement
captioned Biographical Information about Our Director
Nominees.
Our Board of Directors unanimously recommends a vote FOR the
election of each of the nominees for Director described above.
Proxies that are executed and returned will be voted FOR the
election of each of those nominees, except to the extent that
particular proxies contain instructions not to vote for
particular nominees.
Proposal 2:
Advisory Vote on the Companys Compensation of Named
Executive Officers
Section 14A(a)(1) of the Securities Exchange Act of 1934,
which was added by the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010, requires that not less
frequently than once every three years a proxy for an annual or
other meeting of shareholders which is required by the
SECs proxy solicitation rules to include disclosure of
executive compensation must include a separate resolution
subject to shareholder vote to approve the compensation of
executives as disclosed pursuant to the applicable SEC
disclosure requirement. A new SEC rule will require that this
vote relate to the compensation of the named executive officers
In compliance with the requirement of Section 14A(a)(1) and
SEC
Rule 14a-21(a),
at the Annual Meeting of Stockholders, our stockholders will be
asked to vote for or against, or to abstain from voting with
regard to, approval of a resolution stating:
RESOLVED, that the stockholders of Lennar Corporation
approve the compensation of the named executive officers
described in the Proxy Statement dated March 3, 2011
relating to the Corporations 2011 Annual Meeting of
Stockholders.
This Proxy Statement, and in particular the sections of this
Proxy Statement captioned Compensation Committee,
Effects of our Compensation Programs on Risk,
Executive Compensation, (including the subsections
captioned Compensation Discussion and Analysis,
Summary Compensation Table, Grants of
Planned-Based Awards, Outstanding Equity Awards at
Fiscal-Year End, and Option Exercises and Stock
Vested,) and Compensatory Plans and
Arrangements, contains a substantial amount of information
relating to how we compensate our named executive officers. You
should carefully read the information in those sections in order
to decide how to vote with regard to this Proposal.
34
The resolution that is the subject of this Proposal will be
deemed to be approved by the stockholders if a majority of the
votes cast with regard to the resolution are cast in favor
of it.
Vote
not Binding
Section 14A(c) of the Securities Exchange Act states that a
shareholder vote of the type referred to in Section 14A(a)
(i.e., a vote on executive compensation of the type that
is the subject of this Proposal) shall not be binding on the
issuer or the Board of Directors of the issuer and may not be
construed
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(1)
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As overruling a decision by such issuer or Board of Directors.
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(2)
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To grant or imply any change in the fiduciary duties of such
issuer or Board of Directors.
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(3)
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To grant or imply any additional fiduciary duties for such
issuer or Board of Directors; or
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(4)
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To restrict or limit the ability of shareholders to make
proposals for resolutions in proxy materials relating to
executive compensations.
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In other words, the vote that is the subject of this Proposal
will not be binding upon us or upon our Board or its
Compensation Committee. Accordingly, even if a majority of the
votes cast by our stockholders with regard to the resolution are
cast against it, our Board of Directors and its Compensation
Committee will not be required to cause us to change our
compensation programs, and even if a majority of the votes cast
with regard to the resolution are cast in favor of it, our Board
of Directors and its Compensation Committee will not be
precluded from changing our compensation programs. Nonetheless,
if the vote on executive compensation indicates a clear
stockholder preference, the Board of Directors and the
Compensation Committee would consider that in setting executive
compensation for next year.
Our Board of Directors unanimously recommends a vote FOR the
proposal to approve the compensation of named executive officers
described in this proxy statement. Proxies that are executed and
returned will be voted FOR that proposal, except to the extent
that particular proxies contain instructions to vote against, or
to abstain from voting with regard to, that proposal.
Proposal 3:
Advisory Vote on Frequency of Votes on the Companys
Compensation of Executive Officers
As noted in the discussion of Proposal 2,
Section 14A(a)(1) of the Securities Exchange Act of 1934,
which was added by the Dodd-Frank Wall Street Reform and
Consumer Protection act of 2010, requires that not less
frequently than once every three years a proxy for an annual or
other meeting of shareholders which is required by the
SECs proxy solicitation rules to include disclosure of
executive compensation must include a separate resolution
subject to shareholder vote to approve the compensation of
executives as disclosed pursuant to the applicable SEC
disclosure requirement. Section 14A(a)(2) of the Securities
Exchange Act (also added by the Dodd-Frank Act) requires that
not less frequently than once every six years, a proxy for an
annual or other meeting of shareholders for which the SECs
proxy solicitation rules require compensation disclosure shall
include a separate resolution to determine whether votes on
resolutions approving executive compensation (i.e.,
say-on-pay
votes) will occur every 1, 2 or 3 years. However, although
a vote on the frequency of shareholder approvals is only
required once every six years, Section 14A(a)(3)(B)
requires that a vote on frequency be included in the Proxy
Statement for the first annual or other meeting occurring after
the end of the six month period beginning on the date of
enactment of the Dodd-Frank Act (i.e., the first meeting
occurring after January 21, 2011).
Our Board of Directors has determined to hold a shareholder vote
on compensation of executive officers at every Annual Meeting.
Although our Board of Directors could change that, and might do
so if the stockholders vote in favor of less frequent votes on
compensation of executive officers, our Board of Directors has
no current intention of doing so.
35
The form of proxy relating to our 2011 Annual Meeting of
Stockholders enables stockholders to vote, by checking the
appropriate box, to have the vote on executive compensation take
place every 1 year, every 2 years or every
3 years, or to abstain from voting. We will view whichever
of 1 year, 2 years or 3 years receives the
greatest number of votes as being the frequency that is favored
by our stockholders.
Vote
not Binding
As is the case with regard to the shareholder vote to approve
executive compensation, Section 14A(c) of the Securities
Exchange Act states that a shareholder vote of the type referred
to in Section 14A(a)(2) (i.e., a vote on frequency
of the type that is the subject of this Proposal) shall not be
binding on the issuer or the Board of Directors of the issuer
and may not be construed
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(1)
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As overruling a decision by such issuer or Board of Directors.
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(2)
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To grant or imply any change in the fiduciary duties of such
issuer or Board of Directors.
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(3)
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To grant or imply any additional fiduciary duties for such
issuer or Board of Directors; or
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(4)
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To restrict or limit the ability of shareholders to make
proposals for resolutions in proxy materials relating to
executive compensations.
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In other words, the vote that is the subject of this Proposal
will not be binding upon us or upon our Board. Accordingly, even
if a majority of the votes cast by our stockholders are cast in
favor of having votes on compensation of executive officers be
less frequent than every one year, our Board of Directors will
not necessarily cause us to reduce the frequency of those votes.
Nonetheless, if the vote on how frequently the stockholders
should vote on executive compensation indicates a clear
stockholder preference for voting less frequently than every
year, the Board of Directors would consider that in deciding
whether to change its decision to have a vote on compensation of
executive officers every year.
Our Board of Directors unanimously recommends a vote in favor
of our having an advisory vote on the compensation of our
executive officers every ONE year. Proxies that are executed and
returned will be voted vote in favor of our having an advisory
vote on the compensation of our executive officers every ONE
year, except to the extent that particular proxies contain
instructions to vote for a different frequency of advisory votes
or to abstain from voting with regard to the frequency of
advisory votes.
Proposal 4:
Amendments to Sections 7.1 through 7.4 of our
Bylaws
Prior to January 12, 2011, our officers included Stuart A.
Miller as President and chief executive officer and Rick
Beckwitt as Executive Vice President. At a meeting held on
January 12, 2011, our Board of Directors voted to elect
Rick Beckwitt to hold the title of President and to have Stuart
A. Miller hold the title of Chief Executive Officer, subject to
our stockholders approving the amendments to our Bylaws
that are the subject of this proposal.
The provisions of our Bylaws relating to officers, which are in
relevant part essentially unchanged since those Bylaws were
adopted in 1970, provide that our executive officers will be a
President, a Vice President, a Secretary and a Treasurer, and in
the Boards discretion, a Chairman of the Board, additional
vice presidents and one or more assistant secretaries and
assistant treasurers. Those Bylaws further provide that the
President shall be a member of the Board of Directors and the
chief executive officer of the Corporation. Accordingly, unless
our Bylaws are amended, Stuart A. Miller cannot be our chief
executive officer unless he is our President.
Normally, our Board of Directors has the power to amend our
Bylaws. However, our Bylaws provide that Sections 7.1
through 7.4 of Article VII (which relate, among other
things, to the officers we may have and the role of the
President), and Article XI (the provision regarding
amendments of the Bylaws) may only be altered, amended or
repealed with the affirmative vote of a majority of our
outstanding stock that is allowed to
36
vote in elections of directors. Therefore, it is proposed that
our stockholders approve amendments to Article VII of our
Bylaws (the Article captioned Officers) so that
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The officers of the Corporation will be a President, a Secretary
and a Treasurer and the Board of Directors may also elect a
Chief Executive Officer, a Chairman of the Board, a Vice
Chairman of the Board, one or more Vice Presidents, one or more
Assistant Secretaries or Assistant Treasurers and such other
officers as the Board may from time to time deem advisable.
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The Chief Executive Officer, if any, will be the chief executive
officer of the Corporation.
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If there is no Chief Executive Officer, the President will be
chief executive officer of the Corporation.
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The Chief Executive Officer of the Corporation will be a member
of the Board of Directors and will preside over any meetings of
our stockholders at which none of a Chairman of the Board, a
Vice Chairman of the Board, or a Lead Director is present
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The officers of the Corporation, other than the Chairman of the
Board, the Chief Executive Officer and the President, will have
such powers and perform such duties as generally pertain to
their respective offices and as from time to time may be
prescribed by the Board of Directors or the chief executive
officer of the Corporation.
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The Board of Directors may assign to officers or others
descriptive titles (such as chief operating officer, chief
financial officer, principal accounting officer or general
counsel) and may assign to vice presidents designations of
priority (such as executive vice president, senior vice
president or first vice president) or function (such as vice
president finance or a regional vice president).
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Sections 7.1 through 7.4 of our Bylaws, as they are
proposed to be amended, appear in their entirety as
Exhibit 1 to this Proxy Statement.
If our stockholders approve the amendments to our Bylaws
enabling us to have an officer with the title Chief
Executive Officer who will be our chief executive officer, there
will have to be conforming changes to several provisions of our
Bylaws that are not in Article VII. Our Board of Directors
has voted to make those changes, effective if and when our
stockholders approve the amendments to Sections 7.1 through
7.4. In addition, our Board of Directors expects to add a new
Article VI to our Bylaws, codifying our current practice of
having our independent directors meet separately from time to
time and having one independent director designated as the Lead
Director. Among other things, this will result in the current
Article VII (which is the subject of this Proposal) being
renumbered Article VIII and the current
Article XI (which is the subject of
Proposal 5) being renumbered
Article XII.
Required
Vote
Approval of the Proposal to amend Sections 7.1 through 7.4
of our Bylaws requires the affirmative vote of a majority of our
outstanding stock that is entitled to vote in elections of
directors. Abstentions and broker non-votes will have the same
effect as negative votes with regard to the proposal to amend
Sections 7.1 through 7.4 of our Bylaws. Stuart A. Miller,
who has the power to vote shares held by his family that are
entitled to approximately 46.1% of the votes that can be cast in
an election of directors, has said that those shares will be
voted in favor of the proposed amendments to Sections 7.1
through 7.4 of the Bylaws.
Our Board of Directors unanimously recommends a vote FOR the
proposal to approve amendments to Sections 7.1 through 7.4
of our Bylaws. Proxies that are executed and returned will be
voted FOR that proposal, except to the extent that particular
proxies contain instructions to vote against, or to abstain from
voting with regard to, that proposal.
37
Proposal 5:
Amendment to Article XI of our Bylaws.
Article XI of our Bylaws, which governs amendments to the
Bylaws, provides that, with three exceptions, the Bylaws may be
altered, amended or repealed and new Bylaws may be adopted by
the holders of our Class A and Class B common stock,
voting as provided in our Certificate of Incorporation, or by a
majority vote of our Directors. The exceptions are that
Sections 7.1 through 7.4 (which relate to the officers we
may have and the duties of the President) and Article XI
(which relates to bylaw amendments) may only be altered, amended
or repealed with the affirmative vote of a majority of the stock
entitled to vote in elections of directors, and Section 5.3
(which relates to the Independent Directors Committee) may only
be altered, amended or repealed with the approval of the
Independent Directors Committee or with the affirmative vote of
holders of a majority of the shares of our Class A common
stock (voting separately) which are voted with regard to the
alteration, amendment or repeal.
The requirement that our stockholders approve amendments to what
now are Sections 7.1 through 7.4 and Article XI of our
Bylaws was inserted in the Bylaws by our stockholders in 1985 in
connection with a proposal to amend Article VI of our
Certificate of Incorporation and what at that time was
Article IV of our Bylaws to provide for a classified Board
of Directors (i.e., to provide that one-third of our Directors
would be elected each year to serve for a three year term) and
to limit the maximum number of directors. Referring to the
proposed amendment to Article XIII of the Bylaws (the
predecessor of the current Article XI), the proxy statement
relating to the 1985 Annual Meeting of Stockholders said
If the proposed amendments to the By-Laws are adopted, an
amendment to the By-Laws to eliminate classification of the
Board of Directors or the limit on the maximum number of
directors would require approval of the holders of a majority of
the shares entitled to vote on it, . . . However, instead
of requiring a stockholder vote to amend Sections 1, 2, 3
and 4 of Article IV of the Bylaws, the amendment to
Article XIII required a stockholder vote to amend
Sections 1, 2, 3 and 4 of Article VI, which
related to the officers we may have and the duties of the
President, and which now are Sections 7.1 through 7.4 of
our Bylaws.
We no longer have a classified Board of Directors. In 2008, our
stockholders approved removal of the provision of our
Certificate of Incorporation regarding classification of the
Board, and our Board removed the provisions of our Bylaws
regarding classification of the Board. Accordingly, the bylaw
provisions that the shareholder voting requirement were intended
to protect no longer exist. Our Board of Directors does not
believe there is a reason to treat amendments to our Bylaws
relating to the officers we may have and the duties of the
President any differently from any other provision of the
Bylaws. Therefore, our Board recommends that our stockholders
approve an amendment to Article XI removing the requirement
that amendments to any of Sections 7.1 through 7.4 be
approved by your stockholders. Article XI, as it is
proposed to be amended, is Exhibit 2 to this Proxy
Statement.
Required
Vote
Approval of the Proposal to amend Article XI of our Bylaws
requires the affirmative vote of a majority of our outstanding
stock that is entitled to vote in elections of directors.
Abstentions and broker non-votes will have the same effect as
negative votes with regard to the proposal to amend
Article XI of our Bylaws. Stuart A. Miller, who has the
power to vote shares held by his family that are entitled to
approximately 46.1% of the votes that can be cast in an election
of directors, has said that those shares will be voted in favor
of the proposed amendment to Article XI of the Bylaws.
Our Board of Directors unanimously recommends a vote FOR the
proposal to approve the amendment to Article XI of our
Bylaws. Proxies that are executed and returned will be voted FOR
that proposal, except to the extent that particular proxies
contain instructions to vote against, or to abstain from voting
with regard to, that proposal.
38
Proposal 6:
Ratification of Selection of Independent Registered Public
Accounting Firm
The Audit Committee of our Board has selected
Deloitte & Touche LLP as the Companys
independent registered public accounting firm for the fiscal
year ending November 30, 2011, and the Board has directed
that management submit the selection of Deloitte &
Touche LLP as the Companys independent registered public
accounting firm for ratification by the stockholders at the
annual meeting. Deloitte & Touche LLP has been the
Companys independent registered public accounting firm
since fiscal 1994. Information about the fees paid to Deloitte
during our 2009 and 2010 fiscal years can be found in the
section of this proxy statement captioned Independent
Registered Public Accounting Firm.
Neither the Companys Bylaws nor any other governing
documents or law require stockholder ratification of the
selection of the Companys independent registered public
accounting firm. However, the Board is submitting the selection
of Deloitte & Touche LLP to the stockholders for
ratification as a matter of what it believes to be good
corporate practice. If the stockholders fail to ratify the
selection, the Audit Committee will reconsider whether or not to
retain that firm. Even if the selection is ratified, the Audit
Committee in its discretion may direct the appointment of a
different independent registered public accounting firm at any
time during the year if it determines that such a change would
be in the best interests of the Company and its stockholders.
The affirmative vote of a majority of the votes that are cast
with regard to the proposal will be required to ratify the
selection of Deloitte & Touche LLP. Abstentions and
broker non-votes will not be counted for any purpose in
determining whether this proposal has been approved.
Our Board of Directors unanimously recommends a vote FOR the
proposal to ratify the selection of Deloitte & Touche
LLP as the Companys independent registered public
accounting firm. Proxies that are executed and returned will be
voted FOR that proposal except to the extent that particular
proxies contain instructions to vote against, or to abstain from
voting with regard to, that proposal.
Proposal 7:
Stockholder Proposal Regarding the Companys Building
Practices
This stockholder proposal is sponsored by The Nathan Cummings
Foundation and by the Central Laborers Pension Fund. The
address of, and the number of voting securities held by, each of
those stockholders will be provided to any stockholder upon oral
or written request made to our General Counsel. Lennar
Corporation is not responsible for the content of this
stockholder proposal or the statement in support of the proposal.
The
Proposal
STATEMENT IN
SUPPORT
The Intergovernmental Panel on Climate Change (IPCC) recently
concluded that warming of the climate system is unequivocal and
that human activity is the main cause. Debate surrounding
climate change now focuses not on whether a problem exists but
rather on the best means for abatement and adaptation.
The rise in average global temperatures resulting from climate
change is expected to have significant adverse impacts.
According to Business Week, many scientists agree that
the warmer temperatures resulting from climate change are
causing more powerful storms and perhaps intensifying extreme
weather events including droughts and wild fires. Thermal
expansion and melting ice sheets are expected to lead to rising
sea levels, with significant implications for coastal
communities. Rising temperatures will also impact fresh water
supplies. Californias Department of Water Resources, for
instance, has stated that, Adapting Californias
water management systems to climate change presents one of the
most significant challenges for the 21st century.
39
Climate change also has important economic implications. The
Stern Review, often cited as the most comprehensive
overview of the economics of climate change, estimated that the
cumulative economic impacts of climate change could be
equivalent to a loss of up to 20% of average world-wide
consumption if action is not taken quickly. A more general
pronouncement in the IPCCs report, Climate Change 2007:
Impacts, Adaptation and Vulnerability, observed that
Taken as a whole, the range of published evidence
indicates that the net damage costs of climate change are likely
to be significant and to increase over time.
According to the Washington Post, Buildings are the
largest source of the greenhouse-gas emissions that are causing
global warming, and in the United States, half of
building-related emissions are from houses. The EPA
estimates that the residential end-use sector accounted for 21%
of
CO2
emissions from fossil fuel combustion in 2008.
With residential end-use accounting for such a high proportion
of GHG emissions stemming from fossil fuel combustion, a number
of studies have focused on energy efficiency improvements in
residential dwellings as a potential source of emission
reductions. One study in The McKinsey Quarterly found
that nearly a quarter of cost-effective GHG abatement potential
involves efficiency-enhancing measures geared at reducing demand
in the buildings and transportation sectors. A second McKinsey
study concluded that the residential sector represents the
single-largest opportunity to raise energy productivity, noting
that, The adoption of available technologies (including
high-efficiency building shells, compact fluorescent lighting,
and high-efficiency water heating) would cut ... end-use demand
for energy by 32 QBTUs in 2020, equivalent to 5 percent of
global end-user demand in that year.
The
Proposed Stockholder Resolution
RESOLVED: Shareholders request that the Board
of Directors adopt quantitative goals, based on available
technologies, for reducing total greenhouse gas emissions from
the Companys products and operations and report to
shareholders by December 31, 2011, on its plans to achieve
these goals. Such a report will omit proprietary information and
be prepared at reasonable cost.
Board
Recommendation
The Board of Directors unanimously recommends a vote AGAINST
this stockholder proposal.
Lennar Corporation shares the concerns of its stockholders,
homebuyers and many others over the quality of our environment.
The Department of Energy estimates that the average new home is
already 30% more energy efficient than the average existing
home. Proudly, Lennar continues to build its homes in accordance
with, and many times in excess of, current Energy Efficiency
requirements. Lennar often exceeds these requirements through
the inclusion of the following features:
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Solar: The Company is committed to Renewable Energy Generation
and continues to lead the industry in the inclusion of such
Programs and novel financings. Since 2006, when we began our
Solar Initiative, we have:
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Installed over 2,000 residential solar systems
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Introduced a Solar Leasing program that allows our customers to
enjoy the benefits of Solar without the upfront cost associated
with its purchase.
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Energy Efficiency: The Company regularly includes, as a standard
feature, many energy efficiency measures that reduce the overall
energy consumption of our homes. These include:
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Enhanced insulation
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Energy Star Appliances
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Dual Glazed windows
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Certifications: Our divisions have worked with a variety of
certification programs, including:
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Energy Star for Homes
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Environments for Living
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California New Solar Homes Initiative
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The Company remains committed to use its new homes as a vehicle
for enhanced energy efficiency. We continue to keep close watch
of both the Green products in the market today and
the level of government incentive (Federal, State and Local)
which make the inclusions of such products affordable for our
homebuyers. We continue to work with our advocates in the
government and the environmental community to identify and
implement new programs which advance the affordable installation
of Green products and technologies. However, because we are
ultimately guided by the preferences of our homebuyers and
rapidly changing market conditions in which consumers are
extremely price sensitive, we cannot commit to a quantifiable
reduction in Green House Gas emissions given the nascent and
rapidly changing state of this important market. That is why the
Board of Directors unanimously recommends a vote AGAINST the
proposal.
Our Board of Directors unanimously recommends a vote AGAINST
the stockholder proposal. Proxies that are executed and returned
will be voted AGAINST that proposal except to the extent that
particular proxies contain instructions to vote for, or to
abstain from voting with regard to, that proposal.
* * * *
Other
Matters
Our management does not know of any matters other than those
described in this proxy statement that will be presented to the
stockholders for a vote at the Annual Meeting. If any other
matters properly come before the Annual Meeting, or any
adjournments of the Annual Meeting, the persons voting the
management proxies will vote them in accordance with their best
judgment.
Our Annual Report to Stockholders, which includes our Annual
Report on
Form 10-K
for our fiscal year ended November 30, 2010, is being
distributed to our stockholders with this proxy statement. A
copy of our Annual Report on
Form 10-K
may be obtained, without charge, by writing to us at Lennar
Corporation, Attn: Investor Relations, 700 Northwest
107th Avenue, Miami, Florida 33172, or by visiting our
website at www.lennar.com.
Stockholder
Proposals and Stockholder Nominations for Director
Any stockholder who wishes to present a proposal for action at
our next annual meeting of stockholders or wishes to nominate a
director candidate for our Board of Directors must submit such
proposal or nomination in writing to the Office of the General
Counsel at Lennar Corporation, 700 Northwest 107th Avenue,
Miami, Florida 33172. Stockholder nominations for Director
should comply with the information requirements as set forth in
our Corporate Governance Guidelines. Stockholders interested in
submitting a proposal for inclusion in the Proxy Statement for
the 2012 Annual Meeting of Stockholders may do so by following
the procedures prescribed in
Rule 14a-8
under the Securities Exchange Act. To be eligible for inclusion
in our 2012 Annual Meeting Proxy Statement, stockholder
proposals must be received by our Office of the General Counsel
at 700 Northwest 107th Avenue, Miami, Florida 33172 no
later than November 4, 2011.
In addition, in accordance with
Rule 14a-4
under the Securities Exchange Act, the persons named in the
proxies solicited by our management will have the right to
exercise discretionary voting authority with respect to any
proposal that is submitted by a stockholder after
January 18, 2012 that we are not asked to include in our
Proxy Statement for the 2012 Annual Meeting of Stockholders.
41
Communication
with the Board of Directors
Anyone who wishes to communicate with our Board of Directors, a
committee of the Board, the independent Directors as a group or
any member of the Board, may send correspondence to the Office
of the General Counsel at Lennar Corporation, 700 Northwest
107th Avenue, Miami, Florida 33172. The General Counsel
will compile and submit on a periodic basis all stockholder
correspondence to the entire Board of Directors, or, if and as
designated in a particular communication, to a committee of the
Board, the independent Directors as a group or an individual
Director, as applicable.
As set forth in our Code of Business Conduct and Ethics, we
require our associates to maintain the highest level of
integrity in their dealings on behalf of our company and its
subsidiaries. We are dedicated to the utmost ethical standards
and through our corporate charters and guidelines, we remain
committed and accountable to our stockholders, associates,
customers and the communities in which we operate. Concerns or
complaints regarding financial, accounting, auditing, code of
conduct or related matters can be submitted by stockholders,
associates, customers and any other interested persons, and
concerns regarding questionable accounting or auditing matters
can be submitted by employees, confidentially and anonymously to
the Audit Committee of our Board of Directors in the following
manner:
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By email to:
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lennar@tnwinc.com
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By telephone to:
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1-800-503-1531
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By mail addressed to:
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The Network
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Attention: Lennar Corporation
333 Research Court
Norcross, GA 30092
Also, concerns about our operations, our financial reporting,
our business integrity, or any other matter related to our
Company, can be submitted by anyone to the non-management
directors of our Board of Directors in the following manner:
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By email to:
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feedback@lennar.com
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By telephone to:
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1-800-503-1534
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By Order of the Board of Directors,
/s/ Mark Sustana
Secretary and General Counsel
Miami, Florida
March 3, 2011
42
EXHIBIT 1
PROPOSED
AMENDED SECTIONS
7.1 THROUGH 7.4 OF THE BYLAWS
(new language in italics; deletion marked by ˆ )
ARTICLE VII
Officers
7.1 The Board of Directors shall elect, as executive
officers, a President, a Vice President, a Secretary and a
Treasurer, and in their discretion a Chief Executive
Officer, a Chairman of the Board (who does not have to be
an executive of the Corporation), additional Vice
Presidents, ˆ one or more Assistant Secretaries and
Assistant Treasurers and such other officers as the Board may
from time to time deem advisable. Such officers shall be
elected annually by the Board of Directors at its first meeting
following the annual meeting of stockholders, and each shall
hold office until the corresponding meeting of the Board in the
next year and until his successor shall have been duly elected
and qualified or until he or she shall have died or resigned or
shall have been removed, in the manner provided herein. The
powers and duties of Secretary and Treasurer may be exercised
and performed by the same person, and a Vice President may at
the same time hold any other single office except that of
President.
7.2 Any vacancy in any office may be filled for the
unexpired portion of the term by the Board of Directors, at any
regular or special meeting.
7.3 The Chairman of the Board, if any, shall be a
member of the Board of Directors and shall preside at its
meetings. He or she shall keep in close touch with the
administration of the affairs of the Corporation, shall advise
and counsel with the ˆ chief executive officer of the
Corporation, and, in ˆ the absence of the chief
executive officer, with other executives of the Corporation,
and shall perform such other duties as may from time to time be
assigned to him or her by the Board of Directors.
7.4 The Chief Executive Officer, if any, will be the
chief executive officer of the Corporation. If there is no Chief
Executive Officer, the President will be the chief executive
officer of the Corporation. The chief executive officer of
the Corporation will be a member of the Board of Directors and
will preside over any meetings of the stockholders at which the
none of a Chairman of the Board, a Vice Chairman of the Board or
a Lead Director is present. Subject to the direction of the
Board of Directors, the chief executive officer of the
Corporation will have and exercise direct charge of and
general supervision over the business and affairs of the
Corporation and will perform all duties incident to ˆ
being the chief executive officer of a corporation, and
such other duties as from time to time may be assigned to him
or her by the Board of Directors.
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EXHIBIT 2
PROPOSED
AMENDED
ARTICLE XI OF THE BYLAWS
(Deletion marked by ˆ )
ARTICLE XI
Amendments
11.1 ˆ These By-Laws may be altered, amended or
repealed and new By-Laws adopted by the holders of the
Class A common stock and the Class B common stock of
the Corporation voting as provided in the Corporations
Certificate of Incorporation, or by the Board of Directors by a
majority vote at any meeting called for that purpose, except
that Section 5.3 of these By-Laws may only be
altered, amended or repealed with the approval of the
Independent Directors Committee or with the affirmative vote of
the holders of a majority of the shares of Class A common
stock (voting separate and apart from the Class B common
stock) which are voted with respect to the alteration, amendment
or repeal.
44
LENNAR CORPORATION
ATTN: LEGAL DEPARTMENT
700 N.W. 107TH AVENUE
MIAMI, FL 33172
VOTE BY
INTERNET - www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up
until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card
in hand when you access the web site and follow the instructions to obtain your records and to
create an electronic voting instruction form.
Electronic Delivery of Future PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can
consent to receiving all future proxy statements, proxy cards and annual reports electronically via
e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above
to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy
materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time
the day before the cut-off date or meeting date. Have your proxy card in hand when you call and
then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or
return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
M29768-P06675 KEEP THIS PORTION FOR YOUR RECORDS
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY
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LENNAR CORPORATION
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For
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Withhold
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For All |
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Except |
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The Board of Directors recommends you vote FOR the following:
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Vote on Directors
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1. |
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Election of Directors |
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Nominees:
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01) Irving Bolotin
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06) Sidney Lapidus |
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02) Steven L. Gerard
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07) Stuart A. Miller |
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03) Theron I.
Tig Gilliam
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08) Donna E. Shalala |
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04) Sherrill W. Hudson
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09) Jeffrey Sonnenfeld |
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05) R. Kirk Landon |
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Vote on Proposals |
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The Board of Directors recommends you vote FOR the following proposal: |
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2. |
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To approve the Companys
compensation of
executive officers (a non-binding say-on-pay vote).
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The Board of Directors recommends you vote FOR 1 year on the following proposal: |
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have an advisory vote on the Companys
compensation of executive officers once every 1, 2
or 3 years (a non-binding say-on-frequency vote).
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For address changes and/or comments, please check this box and
write them on the back where indicated.
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Please indicate if you plan to attend this meeting.
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Yes
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Please sign your name exactly as it appears above. When signing as attorney, executor,
administrator, trustee or guardian, please add your title as such. When signing as joint tenants,
all parties in the joint tenancy must sign. If a signer is a corporation, please sign in full
corporate name by duly authorized officer.
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To withhold authority to vote for any individual nominee(s) mark For All Except and write the
number(s) of the withheld nominee(s) on the line below. |
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The Board of Directors recommends you vote FOR the
following proposals:
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4. To approve proposed amendments to Sections 7.1
through 7.4 of the Companys Bylaws.
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5. To approve a proposed amendment to Article XI of the
Companys Bylaws.
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6. To ratify the selection of Deloitte & Touche LLP as
the Companys independent registered public
accounting firm for the Companys fiscal year ending
November 30, 2011. |
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The Board of Directors recommends you vote AGAINST
the following proposal:
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7. Stockholder proposal regarding the Companys building
practices.
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NOTE: In the proxy holders best judgment with respect to any
other matters that properly come to a vote at the annual meeting. |
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Signature [PLEASE SIGN WITHIN
BOX] |
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Signature (Joint Owners) |
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com.
M29769-P06675
LENNAR CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF LENNAR CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
ON APRIL 13, 2011
The undersigned appoint(s) Stuart A. Miller, Bruce E. Gross and Mark Sustana, or any of them, as
proxies, each with the power to appoint a substitute, and authorize(s) them to represent the
undersigned and to vote, as designated on the reverse side of this proxy card, all of the shares of
Class A common stock (LEN) and Class B common stock (LEN.B) of Lennar Corporation that the
undersigned is/are entitled to vote at the Annual Meeting of Stockholders of Lennar Corporation to
be held at 11:00 a.m. Eastern Time on Wednesday, April 13, 2011 at 700 Northwest 107th Avenue,
Second Floor, Miami, Florida, 33172 and any adjournment or postponement of that meeting.
THIS PROXY, WHEN PROPERLY
EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ALL NOMINEES, FOR PROPOSAL 2, FOR A 1 YEAR FREQUENCY WITH
REGARD TO PROPOSAL 3, FOR PROPOSALS 4, 5 AND 6, AGAINST PROPOSAL 7, AND IN THE DISCRETION
OF THE PROXY HOLDERS WITH REGARD TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS OF THE MEETING.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED REPLY ENVELOPE
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Address Changes/Comments: |
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(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
*** Exercise Your Right to Vote ***
IMPORTANT
NOTICE Regarding the Availability of Proxy Materials for the
Shareholder Meeting to Be Held on April 13, 2011.
LENNAR CORPORATION
LENNAR CORPORATION
ATTN: LEGAL DEPARTMENT
700 N.W. 107TH AVENUE
MIAMI, FL 33172
Meeting Information
Meeting Type: Annual
For holders as of: February 16, 2011
Date: April 13, 2011 Time: 11:00 a.m., EDT
Location: LENNAR CORPORATION
700 Northwest 107th Avenue
Second Floor
Miami, Florida, 33172
You are receiving this communication because you hold shares in
the above named company.
This is not a ballot. You cannot use this notice to vote
these shares. This communication only presents an overview of more complete proxy materials, which contain important information and are available on the Internet or by mail. You may view the proxy materials
online at www.proxyvote.com or easily request a paper copy (see reverse side).
We encourage you to access and review all of the important
information contained in the proxy materials before voting.
See the reverse side of this notice to obtain proxy materials and voting instructions.
Before You Vote
How to Access the Proxy Materials
Proxy Materials Available to VIEW or RECEIVE:
NOTICE AND PROXY STATEMENT ANNUAL REPORT
How to View Online:
Have the information that is printed in the box marked by the arrow 4 XXXX XXXX XXXX (located on the
following page) and visit: www.proxyvote.com.
How to Request and Receive a PAPER or E-MAIL Copy:
If you want to receive a paper or e-mail copy of these documents, you must request one. There is NO
charge for requesting a copy. Please choose one of the following methods to make your request:
1) BY INTERNET: www.proxyvote.com
2) BY TELEPHONE: 1-800-579-1639
3) BY E-MAIL*: sendmaterial@proxyvote.com
* If requesting materials by e-mail, please send a blank e-mail with the information that is
printed in the box marked by the arrow 4 XXXX XXXX XXXX (located on the following page) in the
subject line.
Requests, instructions and other inquiries sent to this e-mail address will NOT be forwarded to
your investment advisor. Please make the request as instructed above on or before March 30, 2011 to
facilitate timely delivery.
How To Vote
Please Choose One of the Following Voting Methods
Vote In Person: Many shareholder meetings have attendance
requirements including, but not limited to, the possession of an
attendance ticket issued by the entity holding the meeting. Please check the
meeting materials for any special requirements for meeting attendance. At the meeting, you will need to request a ballot to vote these shares.
Vote By Internet: To vote now by Internet, go to www.proxyvote.com. Have the information that is
printed in the box marked by the arrow 4 XXXX XXXX XXXX available and follow the instructions.
Vote By Mail: You can vote by mail by requesting a paper copy of the materials, which will include
a proxy card.
Voting Items
The Board of Directors recommends
you vote FOR the following:
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Election of Directors |
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Nominees: |
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01) Irving Bolotin
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06) Sidney Lapidus |
02) Steven L. Gerard
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07) Stuart A. Miller |
03) Theron I. Tig Gilliam
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08) Donna E. Shalala |
04) Sherrill W. Hudson
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09) Jeffrey Sonnenfeld |
05) R. Kirk Landon |
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The Board of Directors recommends
you vote FOR the following proposal:
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To approve the Companys compensation of executive officers (a non-binding say-on-pay vote). |
The
Board of Directors recommends you
vote for 1 year on the following proposal:
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To have an advisory vote on compensation of executive officers once every 1, 2 or 3 years (a non- binding say-on-frequency vote). |
The Board of Directors recommends you
vote FOR the following proposals:
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To approve proposed amendments to Sections 7.1 through 7.4 of the Company s Bylaws. |
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To approve a proposed amendment to Article XI of the Company s Bylaws. |
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To ratify the selection of Deloitte & Touche LLP as the Company s independent
registered public accounting firm for the Company s fiscal year ending November 30, 2011. |
The Board of Directors recommends you
vote AGAINST the following proposal:
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Stockholder proposal regarding the Companys building practices; and |
NOTE: In the proxy holders best judgment with respect to any other matters that properly come to a
vote at the annual meeting.