Probably the easiest way is to simply open your Lotus 1-2-3 spreadsheet in Excel. It should convert it automatically.
The following is from Excel Help:
You can convert a file from another program to Microsoft Excel by opening it in Excel with the Open command (File menu). If you do not see the file format you want in the Open or Save As dialog box, you can install the converter. For more information about installing add-ins and converters, you can go to the Microsoft Office Web site.