KB Home Announces Final Results of Its Tender Offers

KB Home (NYSE: KBH), one of the nation’s premier homebuilders, today announced the expiration and final results of its tender offers to purchase up to $100 million in aggregate principal amount (the “Maximum 2014 Amount”) of its 5¾% Senior Notes due 2014 (the “2014 Note Tender Offer”) and up to $340 million, less any amount accepted in the 2014 Note Tender Offer, in aggregate principal amount (the “Maximum 2015 Amount”) of its 5⅞% Senior Notes due 2015 and 6¼% Senior Notes due 2015 on an equal-priority basis. The tender offers were made pursuant to an Offer to Purchase dated January 19, 2012 and a related Letter of Transmittal, each as amended by a press release issued on February 1, 2012, which set forth a more detailed description of the terms of the tender offers.

As of 11:59 p.m., New York City time, on February 15, 2012, the aggregate principal amount of 5¾% Senior Notes due 2014 (the “2014 Notes”) tendered was $56,304,000, and the aggregate principal amount of 5⅞% Senior Notes due 2015 and 6¼% Senior Notes due 2015 (together, the “2015 Notes”) tendered was $170,038,000 and $201,050,000, respectively. Because the aggregate principal amount of 2015 Notes tendered exceeded the Maximum 2015 Amount, tendered 2015 Notes will be purchased on a pro rata basis. As a result, KB Home accepted for purchase $56,304,000 in aggregate principal amount of 2014 Notes, $129,993,000 in aggregate principal amount of 5⅞% Senior Notes due 2015, and $153,703,000 in aggregate principal amount of 6¼% Senior Notes due 2015, with settlement expected today. As previously announced, KB Home intends to apply the net proceeds from its public offering of $350 million in aggregate principal amount of 8.00% Senior Notes due 2020, which closed on February 7, 2012, toward the payment of accepted 2014 Notes and 2015 Notes.

Holders whose 2014 Notes have been accepted for purchase will receive $1,010 per $1,000 principal amount of notes. Holders whose 2015 Notes have been accepted for purchase and who tendered at or prior to the “Early Tender Date” of 5:00 p.m., New York City time, on January 31, 2012, will receive $1,000 per $1,000 principal amount of notes, which includes the Early Tender Premium of $30 per $1,000 principal amount. Holders whose 2015 Notes have been accepted for purchase and who tendered after the Early Tender Date will receive $970 per $1,000 principal amount of notes.

Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC served as dealer managers for the tender offers. Global Bondholder Services Corporation served as the depositary and information agent.

For additional information regarding the terms of the tender offers, please contact Citigroup Global Markets Inc. at (800) 558-3745 (toll free) or (212) 723-6106 (collect), or Credit Suisse Securities (USA) LLC at (800) 820-1653 (toll free) or (212) 538-2147 (collect). Requests for documents and questions regarding the tender of securities may be directed to Global Bondholder Services Corporation at (866) 540-1500 (toll free) or (212) 430-3774 (collect).

About KB Home

KB Home (NYSE: KBH), one of the nation’s premier homebuilders, has delivered over half a million quality homes for families since its founding in 1957. The Los Angeles-based company is distinguished by its Built to Order™ homebuilding approach that puts a custom home experience within reach of its customers at an affordable price. KB Home has been named the #1 Green Homebuilder in a study by Calvert Investments and the #1 Homebuilder on FORTUNE magazine’s 2011 World’s Most Admired Companies list. The Company trades under the ticker symbol “KBH” and was the first homebuilder listed on the New York Stock Exchange. For more information about any of KB Home's new home communities, call 888-KB-HOMES or visit www.kbhome.com.

Forward-Looking and Cautionary Statements

Certain matters discussed in this press release, including any statements that are predictive in nature or concern future market and economic conditions, business and prospects, our future financial and operational performance, or our future actions and their expected results are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations and projections about future events and are not guarantees of future performance. We do not have a specific policy or intent of updating or revising forward-looking statements. Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors. The most important risk factors that could cause our actual performance and future events and actions to differ materially from such forward-looking statements include, but are not limited to: general economic, employment and business conditions; adverse market conditions that could result in additional impairments or abandonment charges and operating losses, including an oversupply of unsold homes, declining home prices and increased foreclosure and short sale activity, among other things; conditions in the capital and credit markets (including residential consumer mortgage lending standards, the availability of residential consumer mortgage financing and mortgage foreclosure rates); material prices and availability; labor costs and availability; changes in interest rates; inflation; our debt level, including our ratio of debt to total capital, and our ability to adjust our debt level and structure and to access the credit, capital or other financial markets or other external financing sources; weak or declining consumer confidence, either generally or specifically with respect to purchasing homes; competition for home sales from other sellers of new and existing homes, including sellers of homes obtained through foreclosures or short sales; weather conditions, significant natural disasters and other environmental factors; government actions, policies, programs and regulations directed at or affecting the housing market (including, but not limited to, the Dodd-Frank Act, tax credits, tax incentives and/or subsidies for home purchases, tax deductions for residential consumer mortgage interest payments and property taxes, tax exemptions for profits on home sales, and programs intended to modify existing mortgage loans and to prevent mortgage foreclosures), the homebuilding industry, or construction activities; the availability and cost of land in desirable areas; our warranty claims experience with respect to homes previously delivered and actual warranty costs incurred; legal or regulatory proceedings or claims; our ability to access capital; our ability to use/realize the net deferred tax assets we have generated; our ability to successfully implement our current and planned product, geographic and market positioning (including, but not limited to, our efforts to expand our inventory base/pipeline with desirable land positions or interests at reasonable cost and to expand our community count and open new communities, and our increasing operational and investment concentration in markets in California and Texas), revenue growth, and overhead and other cost reduction strategies; consumer traffic to our new home communities and consumer interest in our product designs, including The Open Series™; the impact of our former unconsolidated mortgage banking joint venture ceasing to offer mortgage banking services after June 30, 2011; the manner in which our homebuyers are offered and obtain residential consumer mortgage loans and mortgage banking services; information technology failures and data security breaches; and other events outside of our control. Please see our periodic reports and other filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended November 30, 2011, for a further discussion of these and other risks and uncertainties applicable to our business.

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