<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
LNR PROPERTY CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
(LNR LOGO)
Seven Hundred Sixty N.W. 107th Avenue, Miami, Florida 33172 - - (305) 485-2000
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 14, 1999
TO THE STOCKHOLDERS OF LNR PROPERTY CORPORATION:
Notice is hereby given that the Annual Meeting of the stockholders of LNR
Property Corporation will be held at the Doral Park Golf and Country Club, 5001
N.W. 104th Avenue, Miami, Florida, on Wednesday, April 14, 1999, at 11:00
o'clock a.m. (Eastern Daylight Savings Time) for the following purposes:
1. To elect directors to serve until the next Annual Meeting of
Stockholders.
2. To transact such other business as may properly come before the
meeting.
Only stockholders of record as of the close of business on February 17,
1999 will be entitled to notice of or to vote at the meeting or any adjournment
of the meeting. The Company's transfer books will not be closed.
If you do not intend to be present at the meeting, please sign and return
the enclosed Proxy. If you attend and vote in person, the Proxy will not be
used.
By Order of the Board of Directors
MICHELLE R. SIMON
Secretary
Dated: March 16, 1999
<PAGE> 3
PROXY STATEMENT
SOLICITATION AND REVOCATION OF PROXY
The accompanying Proxy is solicited by the management of LNR Property
Corporation (the "Company" or "LNR"). All shares represented by proxies will be
voted in the manner designated; or if no designation is made, they will be voted
for the election of directors. Shares represented by proxies which instruct the
proxyholders to abstain (or which are marked by brokers to show that specified
numbers of shares are not to be voted) with regard to particular matters will
not be voted (or will not be voted as to the specified numbers of shares) with
regard to those matters. THIS PROXY STATEMENT AND THE ACCOMPANYING FORM OF PROXY
ARE BEING MAILED ON OR ABOUT MARCH 16, 1999 TO ALL STOCKHOLDERS OF RECORD ON
FEBRUARY 17, 1999. Any stockholder giving a proxy has the power to revoke it at
any time before it is voted by delivery of a written instrument of revocation to
the office of the Company, Seven Hundred Sixty N.W. 107th Avenue, Miami, Florida
33172, or in open meeting, without, however, affecting any vote previously
taken. The presence of a stockholder at the meeting will not operate to revoke a
proxy, but the casting of a ballot by a stockholder who is present at the
meeting will revoke a proxy as to the matter on which the ballot is cast.
COST AND METHOD OF SOLICITATION
The Company will bear the cost of soliciting proxies. Proxies are being
solicited by mail and, in addition, directors, officers and employees of the
Company may solicit proxies personally or by telephone. The Company will
reimburse custodians, brokerage houses, nominees and other fiduciaries for the
cost of sending proxy materials to their principals.
VOTING RIGHTS AND PROXIES
Only stockholders of record as of the close of business on February 17,
1999 will be entitled to vote at the meeting. The only outstanding voting
securities of the Company on that date were 24,906,193 shares of Common Stock
and 10,748,133 shares of Class B Common Stock. Each outstanding share of Common
Stock is entitled to one vote. Each outstanding share of Class B Common Stock is
entitled to ten votes.
Stock may be voted in person or by proxy appointed by a writing signed by a
stockholder. Any message sent to the Company prior to the time for voting which
appears to have been transmitted by a stockholder, or any reproduction of a
proxy, will be deemed sufficient. No proxy will be revoked by the death or
incapacity of the maker, unless written notice of such death or incapacity is
given to the Company by the fiduciary having control of the shares represented
by the proxy.
<PAGE> 4
PRINCIPAL STOCKHOLDERS
The following persons are known by the Company to have owned beneficially
more than 5% of any class of the Company's voting securities as of February 17,
1999:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
-------------- ------------------- -------------------- ----------
<S> <C> <C> <C>
Class B Common Stock Leonard Miller 9,897,930(1) 92.09%
23 Star Island
Miami Beach, FL 33139
Common Stock Cohen & Steers Capital 3,063,100(2) 12.30%
Management, Inc.
757 Third Avenue
New York, NY 10017
Common Stock Wellington Management Co., LLP 2,265,500(2) 9.10%
75 State Street
Boston, MA 02109
Common Stock Eagle Asset Management, Inc. 1,972,673(2) 7.92%
880 Carillon Parkway
St. Petersburg, FL 33716
Common Stock Goldman, Sachs & Co. 1,437,200(2) 5.77%
The Goldman Sachs Group, L.P.
85 Broad Street
New York, NY 10004
</TABLE>
- ---------------
(1) Leonard Miller's shares are owned by two limited partnerships. A corporation
wholly-owned by Mr. Miller is the sole general partner of those
partnerships. The limited partners consist of Mr. Miller, his wife and a
trust of which Mr. Miller is the primary beneficiary. This does not include
30,000 shares of Class B Common Stock owned by Miller Family Foundation,
Inc., a charitable foundation of which Mr. Miller is the President.
(2) Based on information contained in Schedule 13G's.
On February 17, 1999, The Depository Trust Company owned of record
24,566,442 shares of Common Stock, constituting 98.64% of the outstanding Common
Stock and 776,670 shares of Class B Common Stock, constituting 7.23% of the
outstanding Class B Common Stock. The Company understands those shares were held
beneficially for members of the New York Stock Exchange, some of whom may in
turn have been holding shares beneficially for customers.
2
<PAGE> 5
The directors and executive officers beneficially owned the following
voting securities of the Company on January 28, 1999:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
NAME OF BENEFICIAL OWNER TITLE OF CLASS OWNERSHIP(1) CLASS
- ------------------------ -------------- ------------ ----------
<S> <C> <C> <C>
Leonard Miller Class B Common Stock 9,897,930(2)(3) 92.09 %
Common Stock 10,267 (8)
Brian L. Bilzin Common Stock 13,820(4) (8)
Sue M. Cobb Common Stock 30,000(5) (8)
Carlos M. de la Cruz Common Stock 220,000 (8)
Stuart A. Miller Common Stock 165,924(3) (8)
Steven J. Saiontz Common Stock 175,085(3)(6) (8)
Jeffrey P. Krasnoff Common Stock 53,482 (8)
Mark A. Griffith Common Stock 14,084(7) (8)
David G. Levin Common Stock 12,206 (8)
David O. Team Common Stock 8,008 (8)
Directors and Executive Class B Common Stock 9,897,930 92.09 %
Officers as a Group Common Stock 744,938 2.99 %
(18 persons)
</TABLE>
- ---------------
(1) Includes currently exercisable stock options and stock options which become
exercisable within sixty days after January 28, 1999 as follows: Stuart A.
Miller (89,101), Steven J. Saiontz (73,437), Jeffrey P. Krasnoff (50,295),
Mark A. Griffith (11,718), David G. Levin (8,429), David O. Team (7,608) and
all directors and executive officers as a group (277,376). Also includes
shares held by the Company's Employee Stock Ownership/401(k) Plan for the
accounts of the named persons. Additional information about those shares is
contained in Note (2) to the Summary Compensation Table.
(2) Leonard Miller's shares are owned by two limited partnerships. A corporation
wholly-owned by Mr. Miller is the sole general partner of those
partnerships. The limited partners consist of Mr. Miller, his wife and a
trust of which Mr. Miller is the primary beneficiary. This does not include
30,000 shares of Class B Common Stock owned by Miller Family Foundation,
Inc., a charitable foundation of which Mr. Miller is the President.
(3) Stuart Miller is the trustee, and Stuart Miller and Mr. Saiontz's wife are
beneficiaries, of a trust which holds limited partnership interests in a
partnership which owns 5,500,000 shares of Class B Common Stock. Because
Leonard Miller is the principal beneficiary of the trust and owns the
corporation which is the sole general partner of the partnership, Leonard
Miller is shown as the beneficial owner of the 5,500,000 shares and neither
Stuart Miller nor Mr. Saiontz is shown as a beneficial owner of those
shares.
(4) Includes 415 shares owned by Mr. Bilzin's wife as to which he has no voting
or investment power and 1,405 shares owned by Mr. Bilzin's sons as to which
he has no voting or investment power and as to which he disclaims beneficial
ownership.
(5) Does not include 30,000 shares owned by a family limited partnership in
which Ms. Cobb has approximately a 19% limited partnership interest and in
which her husband has approximately a 78% limited partnership interest. A
corporation wholly-owned by Ms. Cobb's husband is the sole general partner
of the partnership. Ms. Cobb does not have voting or investment power with
respect to these shares.
(6) Does not include 9,000 shares held in a trust for Mr. Saiontz's wife.
(7) Includes five shares owned by Mr. Griffith's son as to which he shares
voting and investment power.
(8) Less than 1%.
3
<PAGE> 6
Because each outstanding share of Class B Common Stock is entitled to ten
votes, Leonard Miller, through family partnerships, will be entitled to
98,989,567 votes, which will be 74.77% of the combined votes which may be cast
by all the holders of Common Stock and Class B Common Stock, and all directors
and officers as a group will be entitled to 99,446,862 votes, which will be
75.12% of the combined votes which may be cast by all the holders of Common
Stock and Class B Common Stock as of the record date.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Compliance with Section 16(a) of the Exchange Act requires the Company's
directors, executive officers, and persons owning more than 10% of the Company's
Common Stock to file with the SEC and New York Stock Exchange initial reports of
ownership of Common Stock and other equity securities of the Company on Form 3
and reports of changes in such ownership on Forms 4 or 5. Directors, executive
officers and persons owning more than 10% of the Company's Common Stock are
required to furnish the Company with copies of all Section 16(a) reports they
file.
To the Company's knowledge, based solely on a review of the copies of the
reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended November 30, 1998, none of
the Company's directors, executive officers or more than 10% stockholders failed
to file on a timely basis a report required by Section 16(a).
ELECTION OF DIRECTORS
The following persons will be nominated to serve as directors until the
next Annual Meeting of Stockholders:
<TABLE>
<CAPTION>
TERM
NAME OF DIRECTOR AGE DIRECTOR SINCE EXPIRES
- ---------------- --- -------------- -------
<S> <C> <C> <C>
Leonard Miller (1) 66 June 1997 1999
Stuart A. Miller (1) 41 June 1997 1999
Steven J. Saiontz (1) 40 June 1997 1999
Sue M. Cobb 61 October 1997 1999
Carlos M. de la Cruz 57 October 1997 1999
Brian L. Bilzin 53 December 1997 1999
Jeffrey P. Krasnoff 43 December 1997 1999
</TABLE>
- ---------------
(1) Executive Committee member.
Leonard Miller is the Chairman of the Board of Lennar Corporation
("Lennar"). He was one of the founders of Lennar and from the time Lennar was
founded in 1969 until April 1997, Mr. Miller was the President and Chief
Executive Officer of Lennar. Mr. Miller is the Chairman of the Board of Trustees
of the University of Miami, Chairman of South Florida Annenberg Challenge and a
Director of Union Bank of Florida. Mr. Miller is the father of Stuart Miller and
the father-in-law of Steven Saiontz.
Stuart A. Miller is the Chairman of the Board of LNR. Mr. Miller became the
Chairman of the Board of LNR when it was formed in June 1997. Mr. Miller has
been the President and Chief Executive Officer of Lennar since April 1997. For
more than five years prior to April 1997, Mr. Miller was a vice president of
Lennar and held various executive positions with Lennar subsidiaries, including
being the president of its principal homebuilding subsidiary from December 1991
to April 1997 and the president of its principal real estate investment and
management division (the predecessor to a substantial portion of the Company's
business) from April 1995 to April 1997. Mr. Miller is currently a Director of
Lennar. He is the son of Leonard Miller and the brother-in-law of Steven
Saiontz.
4
<PAGE> 7
Steven J. Saiontz is the Chief Executive Officer of LNR. Mr. Saiontz became
the Chief Executive Officer and a Director of LNR when it was formed in June
1997. For more than five years prior to that, he was the president of Lennar
Financial Services, Inc., a wholly-owned subsidiary of Lennar. Mr. Saiontz is
currently a Director of Lennar. He is the brother-in-law of Stuart A. Miller and
the son-in-law of Leonard Miller.
Sue M. Cobb is, and for more than five years has been, Managing Director
and General Counsel of Cobb Partners, Inc. and affiliated companies, a privately
owned group of companies involved in investments, real estate and resort
development. She was the founding partner of the Public Finance Department in
the law firm of Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel, P.A., with
which she was affiliated from 1978 until early 1998. From 1993 to 1996, she was
also Vice President and General Counsel of Pan American World Airways, Inc. She
is currently the interim Secretary of the Department of Lottery for the State of
Florida. Ms. Cobb is also a Director of Kirkwood Associates, Inc., a closely
held ski and summer resort company headquartered in Kirkwood, California. From
1982 to 1988, she was a member of the Board of Directors of the Federal Reserve
Bank of Atlanta, Miami Branch, and served three terms as Chairman of that Board.
Carlos M. de la Cruz is, and for more than five years has been, the
Chairman of the Board of Eagle Brands, Inc. (a beverage wholesaler), Coca-Cola
Puerto Rico Bottlers and the Miami Honda, Central Hyundai, Sunshine Ford and
Central Kia automobile dealerships.
Brian L. Bilzin is, and since February 1, 1998 has been, a partner in the
law firm of Bilzin Sumberg Dunn Price & Axelrod LLC. For more than five years
prior to February 1, 1998, Mr. Bilzin was a partner in Rubin Baum Levin Constant
Friedman & Bilzin, a law firm.
Jeffrey P. Krasnoff is the President of LNR. Mr. Krasnoff became the
President of LNR when it was formed in June 1997 and became a Director of LNR in
December 1997. From 1987 until June 1997, he was a vice president of Lennar.
From 1990 until he became the President of LNR, Mr. Krasnoff was involved almost
entirely in Lennar's real estate investment and management division (the
predecessor to a substantial portion of the Company's business).
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE ABOVE NAMED
NOMINEES AS DIRECTORS.
5
<PAGE> 8
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the annual compensation, long-term
compensation and all other compensation for the Company's Chief Executive
Officer and for the five additional executive officers who together comprised
the six highest paid executive officers of the Company for the year ended
November 30, 1998:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
-------------------- --------------------------------------
AWARDS PAYOUTS
------------------------- ----------
RESTRICTED
STOCK SECURITIES LTIP ALL OTHER
SALARY(1) BONUS(1) AWARDS(1)(2) UNDERLYING PAYOUTS(1) COMPENSATION (1) (4)
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) OPTIONS ($) ($)
- ------------------------------------ ---- --------- -------- ------------ ---------- ---------- --------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Stuart A. Miller 1998 200,000 304,800 0(3) 0 0 0
Chairman of the Board 1997 16,667 0 0(3) 100,000 0 248
Steven J. Saiontz 1998 510,000 609,600 1,600 0 0 4,045
Chief Executive Officer 1997 17,400 0 133 389,083 0 418
Jeffrey P. Krasnoff 1998 402,000 304,800 1,600 0 165,700 4,260
President 1997 13,800 340,300 133 273,988 102,200 426
David G. Levin 1998 175,000 263,300 1,600 0 90,000 4,260
Vice President 1997 8,800 208,800 133 102,128 60,300 152
Mark A. Griffith 1998 175,000 227,000 1,600 0 69,200 2,610
Vice President 1997 9,300 169,000 133 98,018 37,600 232
David O. Team 1998 200,000 213,300 1,600 0 29,600 4,260
Vice President 1997 11,250 158,800 133 87,331 0 262
</TABLE>
- ---------------
(1) The salary, restricted stock awards and LTIP payout amounts shown for 1998
reflect compensation earned by the named officer for the twelve months ended
November 30, 1998. The bonus amounts shown for 1998 reflect compensation
earned by the named officer for the twelve months ended November 30, 1998
but not yet paid. Payment of such amount is conditioned on the officer's
continuing to be employed by the Company in April 1999. The salary,
restricted stock awards and all other compensation shown for 1997 reflect
only one month, as compensation for the other eleven months was from Lennar.
The bonus and LTIP payouts shown for 1997 include the full year as the
amounts were paid by LNR, with the exception of Stuart A. Miller and Steven
J. Saiontz, each of whose bonus was paid by Lennar in its entirety.
(2) At November 30, 1998, a total of 17,320 restricted shares of Common Stock,
with an aggregate market value of $337,740 on that day, were held in
employees' accounts under the Company's Employee Stock Ownership/401(k)
Plan. All shares in the accounts of employees with more than five years
service are vested (15,743 shares of Common Stock at November 30, 1998).
Shares in the accounts of other employees become vested when and if the
employees attain five years of service. Holders of both vested and
non-vested shares are entitled to the dividends on the shares. The
restricted shares outstanding on November 30, 1998 included 2,264 shares of
Common Stock in Steven J. Saiontz's account (with a market value on that day
of $44,148), 316 shares of Common Stock in Jeffrey P. Krasnoff's account
(with a market value on that day of $6,162), 277 shares of Common Stock in
David G. Levin's account (with a market value on that day of $5,402), 266
shares of Common Stock in Mark A. Griffith's account (with a market value on
that day of $5,187) and zero shares in David O. Team's account. All shares
held in these officers' accounts were vested. Pursuant to an amendment to
the plan, effective January 1, 1999, all shares held in employees' accounts
under the plan became fully vested for employees employed by the Company on
December 31, 1998.
6
<PAGE> 9
(3) Stuart A. Miller does not participate in the Company's Employee Stock
Ownership/401(k) Plan.
(4) Consisting of (1) matching payments by LNR under the 401(k) aspect of its
Employee Stock Ownership/401(k) Plan and (2) term life insurance premium and
long term disability insurance premium payments, made by the Company for
1998 and for the month of November for 1997 as follows:
<TABLE>
<CAPTION>
LONG TERM
TERM LIFE DISABILITY
401(K) MATCH INSURANCE INSURANCE
($) ($) ($)
------------------- -------------------- ----------
<S> <C> <C> <C> <C>
Stuart A. Miller 1998 0(3) 0 0
1997 0(3) 200 48
Steven J. Saiontz 1998 2,285 1,260 500
1997 200 184 34
Jeffrey P. Krasnoff 1998 2,500 1,260 500
1997 200 184 42
David G. Levin 1998 2,500 1,260 500
1997 0 108 42
Mark A. Griffith 1998 850 1,260 500
1997 67 117 42
David O. Team 1998 2,500 1,260 500
1997 100 120 42
</TABLE>
Directors who are not employees of the Company are paid annual fees of
$10,000 plus $2,500 for each board meeting attended in person and $500 for each
telephonic board meeting. If there is a committee meeting on a day that does not
include a full board meeting, the fee is $500 for that day. On the day of each
Annual Meeting of Stockholders, each outside director is granted an option to
purchase 1,000 shares of Common Stock at the market price on that day. Each
option becomes exercisable on the one year anniversary of the grant date and
expires on the third anniversary of the grant date. Upon the death or disability
of an optionee, the option is exercisable up to six months after the death or
disability. Upon resignation or retirement of a director, the option terminates.
Leonard Miller receives an annual fee of $200,000 for serving as Chairman of the
Executive Committee of the Board. Directors who are employees of the Company
receive no additional remuneration for services as directors.
Brian L. Bilzin is a partner in the law firm of Bilzin Sumberg Dunn Price &
Axelrod LLC, which firm was retained by the Company during the fiscal year ended
November 30, 1998 and received fees during that year totalling $1,568,851. The
Company expects to retain this law firm again during the current fiscal year.
Until February 1, 1998, Mr. Bilzin was a partner in the law firm of Rubin Baum
Levin Constant Friedman & Bilzin, which firm was retained by the Company during
the fiscal year ended November 30, 1998.
In the fiscal year ended November 30, 1998, the Company paid a fee of
approximately $304,688 to David G. Levin's brother for acting as an advisor to
the Company in connection with the sale of properties located in Des Plaines,
IL, Mission Viejo, CA and Orlando, FL.
7
<PAGE> 10
The following table sets forth information about sums awarded to four of
the six highest paid officers of the Company for the year ended November 30,
1998 under long term incentive arrangements:
LONG-TERM INCENTIVE PLANS -- AWARDS
IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS
-----------------------------------------
PERIOD UNTIL THRESHOLD TARGET MAXIMUM
NAME PAYOUT $ $ $(1)
- ---- ------------ -------------- -------------- -------
<S> <C> <C> <C> <C>
Jeffrey P. Krasnoff 1-5 Years Not Applicable Not Applicable 304,800
David G. Levin 1-5 Years Not Applicable Not Applicable 263,300
Mark A. Griffith 1-5 Years Not Applicable Not Applicable 227,000
David O. Team 1-5 Years Not Applicable Not Applicable 213,300
</TABLE>
- ---------------
(1) This amount is payable in five equal annual installments conditioned on the
officer's continuing to be employed by the Company.
There were no stock options granted to the Chief Executive Officer or to
the five additional highest paid executive officers of the Company for the
fiscal year ended November 30, 1998.
The following table sets forth certain information with regard to the
aggregate option/SAR exercises in the fiscal year ended November 30, 1998 and
option/SAR values as of the end of that year for the Chief Executive Officer and
the five other highest compensated executive officers of the Company:
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARs OPTIONS/SARs
AT FISCAL AT FISCAL
YEAR-END(1) YEAR-END(2)
SHARES ---------------- ----------------
ACQUIRED ON VALUE EXERCISABLE(E)/ EXERCISABLE(E)/
NAME EXERCISE REALIZED UNEXERCISABLE(U) UNEXERCISABLE(U)
- ---- ----------- -------- ---------------- ----------------
<S> <C> <C> <C> <C>
Stuart A. Miller 0 $0 10,000(E) $ 0(E)
Chairman of the Board(3) 90,000(U) $ 0(U)
Steven J. Saiontz 0 $0 73,437(E) $ 829,342(E)
Chief Executive Officer 315,646(U) $ 2,105,226(U)
Jeffrey P. Krasnoff 0 $0 45,896(E) $ 328,879(E)
President 228,092(U) $ 610,768(U)
David G. Levin 0 $0 9,143(E) $ 12,781(E)
Vice President 92,985(U) $ 199,753(U)
Mark A. Griffith 0 $0 12,432(E) $ 39,665(E)
Vice President 85,586(U) $ 150,513(U)
David O. Team 0 $0 8,733(E) $ 7,114(E)
Vice President 78,598(U) $ 64,035(U)
</TABLE>
- ---------------
(1) In December 1998, the Company provided employees with the opportunity to
surrender some or all of their stock options in exchange for options with a
lower exercise price relating to 70% of the number of shares which were
subject to the surrendered options. The information for unexercised options,
giving effect to exchanges by the individuals listed above, and the value of
those unexercised in-the-money
8
<PAGE> 11
options based on the difference between the exercise prices and the last
reported sales price of the Common Stock on November 30, 1998, were: Jeffrey
P. Krasnoff 42,896 (E) 201,092 (U) shares, $344,192 (E) $748,581(U) value;
David G. Levin 8,018(E) 82,860(U) shares, $18,523(E) $251,433(U) value; Mark
A. Griffith 11,307(E) 75,461(U) shares, $45,407(E) $202,193(U) value and
David O. Team 7,608(E) 68,473(U) shares, $12,856(E) $115,715 (U) value.
Steven J. Saiontz and Stuart A. Miller elected not to surrender any of their
stock options.
(2) Based upon the difference between the exercise price of the options/SARs and
the last reported sale price of the Common Stock on November 30, 1998.
(3) In addition, Mr. Miller holds options granted by Lennar before the spin-off
with regard to 382,000 shares of its common stock. As a result of the
spin-off, when Mr. Miller exercises those options, he will be entitled to
receive, in addition to Lennar stock, one share of Common Stock of the
Company for each share of Lennar stock as to which the options are
exercised.
INFORMATION REGARDING THE BOARD OF DIRECTORS
The Board has established Audit and Compensation Committees. It does not
have a Nominating Committee.
The Audit Committee consists of Ms. Sue M. Cobb and Mr. Carlos M. de la
Cruz. This Committee met three times in fiscal 1998. Its principal functions
are: recommending to the full Board the engagement of independent auditors for
the ensuing year, reviewing the scope of non-audit services performed for the
Company by the independent auditors, reviewing the independent auditors'
recommendations for improvements of internal controls and reviewing the plans,
reports and staffing of the Company's Internal Audit Department.
The Compensation Committee consists of Messrs. Leonard Miller and Brian
Bilzin. This Committee did not meet in fiscal 1998. (See Compensation Committee
Report below.) Its principal functions are: recommending to the full Board
compensation arrangements for senior management and recommending to the full
Board the adoption and implementation of compensation and incentive plans. In
addition, there is an Officers and Directors Stock Option Committee, consisting
of Ms. Sue M. Cobb and Mr. Carlos M. de la Cruz, and a Stock Option Committee,
consisting of Messrs. Stuart A. Miller, Leonard Miller and Jeffrey P. Krasnoff,
which approve grants of stock options and SARs under the Company's stock option
plan, set the terms of these options and SARs and administer the stock option
plan.
The Company's by-laws require that any significant transactions it has with
Lennar or its subsidiaries, including significant decisions regarding Lennar
Land Partners (of which the Company and Lennar each own 50%), be approved by an
Independent Directors Committee, which consists entirely of members of the Board
who are not directors, officers or employees of Lennar. The members of the
Independent Directors Committee are Ms. Sue M. Cobb and Messrs. Carlos M. de la
Cruz and Brian L. Bilzin.
The Board normally holds meetings quarterly, but holds additional special
meetings when required. During fiscal 1998, the Board met seven times. Each
director attended more than three-fourths of the total number of meetings of the
Board which were held while he or she was a director and at least three-fourths
of the total number of meetings of all committees of the Board on which he or
she served.
9
<PAGE> 12
COMPENSATION COMMITTEE REPORT
Before Lennar distributed the stock of the Company to its stockholders (and
therefore, while the Company was a wholly-owned subsidiary of Lennar), Lennar's
Compensation Committee fixed the compensation of the executive officers of the
Company for the year ending November 30, 1998. It did that because the Company
would have two new directors who would not take office until the distribution of
the Company's stock was completed, and would not be familiar with the executive
officers of the Company. Therefore, it seemed appropriate for Lennar's
Compensation Committee to review the recommended compensation of the Company's
executive officers, subject possibly to subsequent review by the Company's Board
of Directors.
Lennar's Compensation Committee discussed the proposed compensation and
award of stock options to Steven J. Saiontz, the Chief Executive Officer of the
Company, and Jeffrey P. Krasnoff, the President of the Company. It noted that,
although Mr. Saiontz is the Chief Executive Officer of the Company, he has
principal responsibility for a portion of the Company's operations and Mr.
Krasnoff has principal responsibility for the other portion of the Company's
operations, and, therefore, their levels of responsibility are in some respects
equivalent. Lennar's Compensation Committee also noted that Mr. Saiontz and Mr.
Krasnoff would be responsible for the initial adjustment of the Company to being
a publicly owned company and for overseeing, with the assistance of Stuart A.
Miller (who is Lennar's chief executive officer and the Chairman of the Board of
the Company), the initial activity of the Company and its subsidiaries as a
separate corporate group. Lennar's Compensation Committee also was informed that
there would be a recommendation to the Company's Board of Directors that Mr.
Saiontz and Mr. Krasnoff each receive options to purchase 200,000 shares of the
Company's Common Stock, in addition to receiving Company stock options to
replace the Lennar stock options they held. The Company's Board of Directors
(which, at the time, consisted entirely of officers or employees of Lennar or
its subsidiaries) subsequently approved the grant of options to purchase 200,000
shares to each of Mr. Saiontz and Mr. Krasnoff.
Lennar's Compensation Committee reviewed a compilation of information about
compensation of senior officers of other real estate investment and asset
management companies. It noted that, while there was a wide variation in the
compensation of senior officers of companies shown in the compilation, the
proposed compensation of Messrs. Saiontz and Krasnoff would be less than that of
the most senior officers of the company included in the compilation which was
most similar to the Company. It then determined that for the year ending
November 30, 1998, Mr. Saiontz would be paid a base salary of $500,000 plus a
bonus equal to 0.50% of the consolidated net income of the Company and its
subsidiaries, before income taxes, and Mr. Krasnoff would be paid a base salary
of $400,000 plus a bonus equal to 0.50% of the consolidated net income of the
Company and its subsidiaries, before income taxes, during that year.
Lennar's Compensation Committee then reviewed recommendations for salary
and bonuses for other executive officers of the Company and its subsidiaries,
and approved the recommended compensation for the year ending November 30, 1998
of executive officers of the Company in addition to Mr. Saiontz and Mr.
Krasnoff. That included compensation to Stuart A. Miller for serving as Chairman
of the Board of the Company, to which he is expected to devote approximately 25%
of his working time, of $200,000 plus a bonus equal to 0.25% of the consolidated
net income of the Company and its subsidiaries, before income taxes, during that
year.
LEONARD MILLER
BRIAN BILZIN
10
<PAGE> 13
PERFORMANCE GRAPH
The following graph compares the one year cumulative total return of the
Company's Common Stock, assuming reinvestment of dividends, with the Standard
and Poors 500 Index, Russell 2000 Index, and the Company's Peer Group which
includes Amresco, Criimi Mae and Ocwen:
COMPARISON OF CUMULATIVE TOTAL RETURN(1)
12/1/97 - 11/30/98, FYE 11/30/98
(12/1/97 = 100)
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
LNR
PROPERTY S&P 500 RUSSELL 2000
MEASUREMENT PERIOD(1) CORPORATION INDEX INDEX PEER GROUP
<S> <C> <C> <C> <C>
12/1/97 100 100 100 100
1/26/98 97 98 97 97
3/30/98 104 113 110 114
6/1/98 107 113 105 108
7/27/98 96 119 101 106
9/28/98 76 109 86 44
11/30/98 81 121 93 36
</TABLE>
(1) The Cumulative Total Return is based on the Company's first fiscal year of
operations since the spin-off on October 31, 1997.
OTHER MATTERS
The Company's management knows of no matters, other than the foregoing,
which will be presented for action at the meeting. If any other matters properly
come before the meeting, or any adjournments, the person or persons voting the
management proxies will vote them in accordance with their best judgment.
AUDITORS
Deloitte & Touche LLP audited the Company's financial statements for the
year ended November 30, 1998. Representatives of that firm are expected to be
present at the Annual Meeting of Stockholders to answer questions. They will be
given an opportunity to make a statement if they wish to do so.
The Board of Directors has not at this time selected an accounting firm to
audit the Company's financial statements for the year ending November 30, 1999.
The selection will be discussed at meetings of the Audit Committee and of the
Board of Directors to be held after the Company's April 14, 1999 Annual Meeting.
11
<PAGE> 14
STOCKHOLDERS' PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
Proposals which stockholders wish included in next year's Proxy Statement
must be received at the Company's principal executive offices at Seven Hundred
Sixty N.W. 107th Avenue, Miami, Florida 33172 no later than November 16, 1999.
By Order of the Board of Directors
MICHELLE R. SIMON
Secretary
Dated: March 16, 1999
12
<PAGE> 15
Appendix A
DETACH HERE
PROXY
[LNR PROPERTY CORPORATION LOGO]
760 N.W. 107TH AVENUE
MIAMI, FLORIDA 33172
PROXY FOR 1999 ANNUAL MEETING
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of LNR PROPERTY CORPORATION hereby appoints
Stuart A. Miller and Michelle R. Simon, or any one or more of them present, with
full power of substitution, as attorneys and proxies of the undersigned to
appear at the Annual Meeting of Stockholders of LNR PROPERTY CORPORATION to be
held at the Doral Park Golf and Country Club, 5001 N.W. 104th Avenue, Miami,
Florida on Wednesday, April 14, 1999, and at any and all adjournments thereof,
and there to act for the undersigned and vote all shares of Common Stock of LNR
PROPERTY CORPORATION standing in the name of the undersigned, with all the
powers the undersigned would possess if personally present at the meeting, as
follows on the reverse side.
[SEE REVERSE SIDE]
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE> 16
DETACH HERE
PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. THIS PROXY WHEN PROPERLY
EXECUTED WILL BE VOTED IN THE MANNER DIRECTED. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR ALL THE LISTED NOMINEES FOR ELECTION OF DIRECTORS AND
FOR ALL OF THE OTHER PROPOSALS.
1. ELECTION OF DIRECTORS:
NOMINEES: Leonard Miller, Stuart A. Miller, Steven J. Saiontz, Sue M. Cobb,
Carlos M. de la Cruz, Brian L. Bilzin and Jeffrey P. Krasnoff
FOR WITHHELD
[ ] ALL [ ] FROM ALL
NOMINEES NOMINEES
[ ]________________________________________________
For all nominees except as noted above
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [ ]
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE.
Please sign exactly as name appears at left.
When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title
as such. If a corporation, please sign in full corporate name by President or
other authorized officer. If a partnership, please sign in partnership name by
an authorized person.
Signature:_________________Date:________Signature:_________________Date:________
<PAGE> 17
Appendix B
DETACH HERE
PROXY
[LNR PROPERTY CORPORATION LOGO]
760 N.W. 107TH AVENUE
MIAMI, FLORIDA 33172
PROXY FOR 1999 ANNUAL MEETING
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of LNR PROPERTY CORPORATION hereby appoints
Stuart A. Miller and Michelle R. Simon, or any one or more of them present, with
full power of substitution, as attorneys and proxies of the undersigned to
appear at the Annual Meeting of Stockholders of LNR PROPERTY CORPORATION to be
held at the Doral Park Golf and Country Club, 5001 N.W. 104th Avenue, Miami,
Florida on Wednesday, April 14, 1999, and at any and all adjournments thereof,
and there to act for the undersigned and vote all shares of Class B Common Stock
of LNR PROPERTY CORPORATION standing in the name of the undersigned, with all
the powers the undersigned would possess if personally present at the meeting,
as follows on the reverse side.
[SEE REVERSE SIDE]
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE> 18
DETACH HERE
PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. THIS PROXY WHEN PROPERLY
EXECUTED WILL BE VOTED IN THE MANNER DIRECTED. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR ALL THE LISTED NOMINEES FOR ELECTION OF DIRECTORS AND
FOR ALL OF THE OTHER PROPOSALS.
1. ELECTION OF DIRECTORS:
NOMINEES: Leonard Miller, Stuart A. Miller, Steven J. Saiontz, Sue M. Cobb,
Carlos M. de la Cruz, Brian L. Bilzin and Jeffrey P. Krasnoff
FOR WITHHELD
[ ] ALL [ ] FROM ALL
NOMINEES NOMINEES
[ ]________________________________________________
For all nominees except as noted above
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [ ]
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE.
Please sign exactly as name appears at left.
When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title
as such. If a corporation, please sign in full corporate name by President or
other authorized officer. If a partnership, please sign in partnership name by
an authorized person.
Signature:_________________Date:________Signature:_________________Date:________
