Summary

This summary contains basic information about our business and this offering and highlights selected information contained elsewhere in this offering memorandum. This summary is not complete and does not contain all of the information that you should consider before deciding whether or not to invest in the notes. For a more complete understanding of our business and this offering, you should read this entire offering memorandum, especially the description of the terms and conditions of the notes discussed under “Description of the Notes” and the risks discussed under “Risk Factors” included in, or otherwise incorporated by reference in, this offering memorandum.

Our company

We are one of the largest Western U.S. regional homebuilders. Headquartered in Newport Beach, California, we are primarily engaged in the design, construction, marketing and sale of single-family detached and attached homes in California, Arizona, Nevada, Colorado, Oregon, and Washington. Our core markets currently include Orange County, Los Angeles, the Inland Empire, the San Francisco Bay Area, Phoenix, Las Vegas, Denver, Portland and Seattle. In addition, our proposed acquisition of RSI Communities LLC will mark an expansion of our presence in the Inland Empire and our entry into the Austin and San Antonio sub-markets of Texas.

We have a distinguished legacy of more than 60 years of homebuilding operations, over which time we have sold in excess of 102,000 homes. Our markets are characterized by attractive long-term housing fundamentals. We hold leading market share positions in most of our markets and have a significant land supply.

We have significant expertise in understanding the needs of our homebuyers and designing our product offerings to meet those needs. This allows us to maximize the return on our land investments by tailoring our home offerings to meet the buyer demands in each of our markets. We build and sell across a diverse range of product lines at a variety of price points with an emphasis on sales to entry-level and first-time move-up homebuyers and, to a lesser extent, second-time move-up homebuyers, as well as a signature luxury brand. In addition, we have an active-adult segment, which is marketed through our Ovation brand. We are committed to achieving the highest standards in design, quality and customer satisfaction and have received numerous industry awards and commendations throughout our operating history in recognition of our achievements.

For the year ended December 31, 2017, we had revenues from homes sales of $1,795.1 million, a 28.0% increase from $1,402.2 million for the year ended December 31, 2016, which includes results from all reportable operating segments. We had net new home orders of 3,328 homes in the year ended December 31, 2017, a 19.9% increase from 2,775 in the year ended December 31, 2016. As of December 31, 2017, we had a total of 17,436 lots owned or controlled, and were selling homes out of an average of approximately 80 active selling communities during the fourth quarter of 2017. As of December 31, 2017, we had a consolidated backlog of 822 homes sold but not closed, with an associated sales value of $433.0 million, representing a 12.1% increase in units, and a 5.4% increase in dollar value, as compared to the backlog at December 31, 2016.

We believe that the attractive fundamentals in our markets, our leading market share positions, our long-standing relationships with land developers, our significant land supply and our focus on providing the best possible customer experience position us to capitalize on meaningful growth as the U.S. housing market continues to demonstrate strong fundamentals.

Acquisition of RSI

RSI acquisition

On February 20, 2018, we announced that we entered into definitive agreements to acquire RSI Communities LLC (“RSI”), a Southern California and Texas based homebuilder for a cash purchase price of approximately $423.0 million, and three additional related real estate assets (the “RSI Legacy Assets”) for a cash purchase price of approximately $37.3 million (the “RSI Acquisition”), subject to net asset value adjustments.

The RSI Acquisition enhances our position in the land-constrained Southern California market and marks our entry into Texas with immediate size and scale in Austin as a foothold in the attractive Texas region, as well as projects in San Antonio. As of December 31, 2017, RSI (including the RSI Legacy Assets) had 29 active selling communities and owned or controlled 11,128 lots, including 3,173 in the Inland Empire, California; 6,895 in Austin, Texas; and 1,060 in San Antonio, Texas. RSI’s owned inventory as of December 31, 2017 consisted of lots in various stages as follows: 31% are under construction, 33% are finished lots and 36% are land and land under development. RSI primarily targets the entry-level and first time buyer segments, with approximately 70% of RSI deliveries in 2017 at average selling prices falling below the FHA loan limits.

RSI’s management team is comprised of recognized industry leaders and homebuilding veterans with significant experience in land acquisition, operational discipline and public company expertise. In addition, the team has deep relationships and local knowledge that we believe will allow us to achieve best-in-class results as we expand our operations to Texas and enhance our Southern California pipeline. In 2017, RSI’s operating teams delivered 461 new homes, and had total construction starts of 920. From January 1, 2018 through February 28, 2018, RSI (including the RSI Legacy Assets) recorded net new home orders of 167 homes sold and have backlog of 252 homes sold but not closed.

We intend to fund the RSI Acquisition with cash on hand, proceeds from this offering, and land banking proceeds. The transaction is subject to the satisfaction of customary closing conditions and regulatory approvals and is expected to close in March of 2018. This offering is not conditioned on the consummation of the RSI Acquisition.

Overall, we believe the RSI Acquisition will drive meaningful benefits from our increased operating scale, and expanded geographic footprint, building on our successful 2014 acquisition of Polygon Northwest. See “Where You Can Find More Information” and “Index to Financial Statements of RSI” in this offering memorandum for more information regarding the RSI Acquisition and RSI’s financial and other data.

Transactions related to the RSI acquisition

Bridge credit facility

In connection with the entry into the definitive agreements related to the RSI Acquisition, we received definitive financing commitments from affiliates of certain of the initial purchasers for a 364-day term loan credit facility in the amount of $250.0 million, available in a single draw (the “Bridge Credit Facility”). Loans under the Bridge Credit Facility, if any, would bear interest at an annual rate equal to a Eurodollar rate (subject to a minimum “floor” of 0.00%), plus a margin ranging from 2.50% to 3.00% based on certain leverage ratios. Assuming this offering is closed prior to or concurrently with the consummation of the RSI Acquisition, we will not borrow any amounts under the Bridge Credit Facility and will cancel the Bridge Credit Facility.

Land bank arrangements

We intend to enter into several separate land bank arrangements with respect to certain land parcels located in California and Texas that will be acquired as part of the RSI Acquisition, each of which is entitled and in various stages of development (collectively, the “Land Bank Arrangements”). Land bank arrangements are a method of acquiring land in staged takedowns, typically over a time period of 24 to 36 months, that we employ from time to time in the ordinary course of business to access parcels of land with minimal cash outlay. Under the Land Bank Arrangements, the land banker will purchase the underlying land assets that will be acquired as part of the RSI Acquisition and fund all horizontal land development costs, and provide us with an option to purchase back the finished lots on a rolling basis for a pre-determined purchase price. In consideration for the option to purchase, we anticipate that we will make a non-refundable deposit of approximately 15% of the total purchase price of the parcels at issue. We anticipate that the Land Bank Arrangements will close concurrently with, or immediately prior to, the closing of the RSI Acquisition, and we expect the aggregate proceeds to us from the Land Bank Arrangements to be approximately $200.0 million, net of deposits.

Amendment to revolving credit facility

In connection with the consummation of the RSI Acquisition, we expect to amend our existing $170.0 million revolving credit facility (our “Revolving Credit Facility”) prior to the closing of this offering to, among other things, temporarily increase the leverage ratios permitted thereunder such that the maximum leverage ratio will increase to 70% as of March 31, 2018 and through and including June 29, 2018, will decrease to 65% as of June 30, 2018 and through and including December 30, 2018, and will further decrease to 60% on the last day of the 2018 fiscal year and remain at 60% thereafter, and to permit the Company’s entering into the Bridge Credit Facility. See “Description of Other Indebtedness—Revolving Credit Facility” in this offering memorandum for an additional discussion of the terms of the Revolving Credit Facility.

General corporate information and history

Our principal executive offices are located at 4695 MacArthur Court, 8^th Floor, Newport Beach, California 92660 and our telephone number is (949) 833-3600. Our website address is www.lyonhomes.com. Information contained on our website is not a part of this offering memorandum and the inclusion of the website address in this offering memorandum is an inactive textual reference only.

Summary Historical Financial Data

The following table sets forth certain of our historical financial and other data. The summary historical consolidated statement of operations data, other financial data and operating data for the years ended December 31, 2017 and 2016, and the balance sheet data as of December 31, 2017 and 2016, have been derived from our audited consolidated financial statements and the related notes incorporated by reference in this offering memorandum. The summary historical consolidated financial data set forth below are not necessarily indicative of the results of future operations.

For information regarding the historical financial data of RSI (excluding the RSI Legacy Assets), refer to the historical audited consolidated financial statements of RSI and the related notes included elsewhere in this offering memorandum. The historical audited financial data for RSI included elsewhere in this offering memorandum do not reflect the results of operations or financial condition of the RSI Legacy Assets. See “Where You Can Find More Information” and “Index to Financial Statements of RSI” in this offering memorandum.