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E-House Prices Offering Of US$135 Million Convertible Senior Notes

SHANGHAI, Dec. 12, 2013 /PRNewswire-FirstCall/ -- E-House ( China) Holdings Limited (NYSE: EJ) ("E-House" or the "Company"), a leading real estate services company in China, today announced the pricing of US$135 million in aggregate principal amount of 2.75% Convertible Senior Notes due 2018 (the "notes"). The notes were offered to qualified institutional buyers in reliance on Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and certain non-U.S. persons in compliance with Regulation S under the Securities Act.

The notes will be convertible into the Company's American Depositary Shares ("ADSs"), each representing one ordinary share of E-House, par value US$0.001 per share (the "ordinary shares"), at the option of the holders, based on an initial conversion rate of 59.5380 of the Company's ADSs per US$1,000 principal amount of notes (which is equivalent to an initial conversion price of approximately US$16.80 per ADS and represents an approximately 30% conversion premium over the closing trading price of the Company's ADSs on December 11, 2013, which was US$12.92 per ADS). The conversion rate is subject to adjustment upon the occurrence of certain events.

Holders of the notes may convert their notes in integral multiples of US$1,000 principal amount and at any time prior to the close of business on the second business day immediately preceding the maturity date. Holders of the notes will have the right to require the Company to repurchase for cash all or part of their notes on December 15, 2016 or upon the occurrence of certain fundamental changes at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.

The notes will bear interest at a rate of 2.75% per year, payable semiannually in arrears on June 15 and December 15 of each year, beginning on June 15, 2014. The notes will mature on December 15, 2018, unless previously repurchased or converted in accordance with their terms prior to such date.

The Company plans to use approximately US$45 million of the net proceeds from the offering to pay the premium of the call option (defined below). The remainder of the net proceeds of the offering will be used for general corporate purposes, including working capital needs and potential investments in or acquisitions of complementary businesses.

In connection with the offering, the Company has entered into a zero-strike call option (the "call option") with an affiliate of the initial purchaser (the "option counterparty"). The call option is intended to facilitate privately negotiated transactions by which investors in the notes will hedge their investment in the notes. The Company has been advised that, in connection with establishing its initial hedge of the call option, the option counterparty (or its affiliate) expects to enter into one or more derivative transactions with respect to the ADSs with purchasers of the notes after the pricing of the notes. This activity could increase (or reduce the size of any decrease in) the market price of the ADSs or the notes at that time. In addition, the option counterparty (or its affiliate) may modify its hedge position by entering into or unwinding one or more derivative transactions with respect to the ADSs and/or purchasing or selling ADSs or other securities of the Company in secondary market transactions following the pricing of the notes and prior to the maturity of the notes (and is likely to unwind its derivative transactions and/or purchase or sell ADSs in connection with any conversion of the notes at or shortly prior to the maturity of the notes). These activities could also cause an increase or avoid a decrease in the market price of the ADSs or the notes.

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