Company to Emerge by end of February with a Significantly Stronger Balance Sheet
William Lyon Homes, which develops new home communities in California, Arizona and Nevada, today announced that its pre-packaged plan of reorganization has been confirmed by the U.S. Bankruptcy Court just 53 days after its plan and related petitions were filed. The Company expects to emerge by the end of February.
As previously announced, upon emergence, approximately $180 million in principal amount of debt will be eliminated as part of the recapitalization plan, resulting in a 37% reduction in overall debt. Annual cash interest expense will also be reduced by nearly $25 million or approximately 45% compared with current levels.
"The successful and rapid recapitalization of the Company is due in large part to the continued loyalty of our customers and suppliers, the professionalism and dedication of our employees and the commitment and support of our creditor groups," said Chief Executive Officer General William Lyon.
The plan of reorganization, which is supported by all of the Company's stakeholder groups, significantly strengthens the Company's liquidity by providing $85 million in new capital investment upon emergence.
"Since we began this process just a few months ago, William Lyon Homes has successfully recapitalized the Company's financial position, strengthened its business through the acquisition of highly desirable properties in Northern California and South Orange County, and built a foundation from which we can grow. In a matter of days, William Lyon Homes will emerge from this process a more competitive company with a strong balance sheet," Chief Operating Officer and President William H. Lyon stated.
"Today marks the beginning of the next phase in William Lyon Homes' long history," said Executive Vice President Matthew R. Zaist. "We are extremely appreciative of the support of all of our stakeholders and are confident that William Lyon Homes will continue to develop premier communities for many years to come."
Irell & Manella and Pachulski Stang Ziehl and Jones served as legal counsel and Alvarez & Marsal served as financial advisor to the Company.
About William Lyon Homes
William Lyon Homes is primarily engaged in the design, construction and sale of new single-family detached and attached homes in California, Arizona and Nevada. Its corporate headquarters is located in Newport Beach, California. For more information about William Lyon Homes and its new home developments, please visit its website at www.lyonhomes.com.
Certain statements contained in this release that are not historical information contain forward-looking statements.The forward-looking statements involve risks and uncertainties and actual results may differ materially from those projected or implied.Further, certain forward-looking statements are based on assumptions regarding future events which may not prove to be accurate.Factors that may impact such forward-looking statements include, among others, changes in general economicconditions and in the markets in which the Company competes, the outbreak, continuation or escalation of war or other hostilities, including terrorism, involving the United States, changes inmortgage and other interest rates, changes in prices of homebuilding materials, weather, the occurrence of events such as landslides, soil subsidence and earthquakes that are uninsurable, noteconomically insurable or not subject to effective indemnification agreements, the availability of labor and homebuilding materials, changes in governmental laws and regulations, the timing ofreceipt of regulatory approvals and the opening of projects, and the availability and cost of land for future development, as well as the other factors discussed in the Company's reports filed with the Securities and Exchange Commission.
The new securities expected to be issued pursuant to the plan have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws. Therefore, any such new securities may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.
This release does not constitute a solicitation of consents or votes to accept any plan, an offer to purchase any securities or a solicitation of an offer to sell any securities. Any solicitation or offer will be made pursuant to a disclosure statement and applicable law.
Contacts:
William Lyon Homes
Matthew R. Zaist
Executive Vice President
(949)
833-3600
