Summary of RYLAND GROUP INC

Entry into a Material Definitive Agreement, Creation of a Direct Financial Oblig

Item 1.01 Entry into a Material Definitive Agreement

On May 10, 2012, The Ryland Group, Inc. (the "Company") and certain of its subsidiaries entered into a Terms Agreement (including the Underwriting Agreement Basic Provisions) to sell $225 million aggregate principal amount of its 1.625% Convertible Senior Notes due 2018 (the "Notes"). The offering of the Notes closed on May 16, 2012. The Company received net proceeds of approximately $218.8 million from this offering, before offering expenses. The Company expects to use these proceeds for general corporate purposes, which may include repayment or repurchase of outstanding indebtedness. The Company made certain customary representations, warranties and covenants concerning the Company in the Terms Agreement (including the Underwriting Agreement Basic Provisions) and also agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended.

The Company will pay interest on the Notes on May 15 and November 15 of each year, commencing on November 15, 2012. The Notes will mature on May 15, 2018. The Notes will initially be convertible into shares of the Company's common stock (the "Common Stock") at a conversion rate of 31.2168 shares of the Company's Common Stock per $1,000 principal amount of Notes, corresponding to an initial conversion price of approximately $32.03 per share, representing a conversion premium of approximately 42.5% based on the closing price of $22.48 per share of the Common Stock on May 10, 2012. The conversion rate will be subject to adjustment upon the occurrence of certain events. The Notes will be fully and unconditionally guaranteed, jointly and severally, by substantially all of the Company's wholly owned homebuilding subsidiaries (the "Guarantors").

The Notes were issued under an indenture with The Bank of New York Mellon Trust Company, N.A., as successor to JPMorgan Chase Bank, N.A., formerly known as The Chase Manhattan Bank, as trustee. (the "Trustee"), dated June 28, 1996 (the "Indenture"), as supplemented by that certain Seventh Supplemental Indenture, dated as of May 16, 2012, by and among the Company, the Guarantors and the Trustee (the "Supplemental Indenture"). A copy of the press release announcing the closing is filed as Exhibit 99.1 hereto.

A legality opinion of DLA Piper LLP (US) with respect to the validity of the Notes, the Guarantees and the shares of Common Stock issuable upon conversion of the Notes is attached hereto as Exhibit 5.1 and is incorporated herein by reference.

The Terms Agreement under which the Company sold the Notes (including the Underwriting Agreement Basic Provisions), the Indenture, a form of the Notes, the Supplemental Indenture and the statement of eligibility of the trustee are all filed or incorporated by reference as exhibits to this current report.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

1.1 Terms Agreement (including the Underwriting Agreement Basic Provisions) dated May 10, 2012, among the Company, the Guarantors and the Underwriters named therein.

4.1 Indenture dated as of June 28, 1996 between the Company and The Bank of New York Mellon Trust Company, N.A., as successor to JPMorgan Chase Bank, N.A., formerly known as The Chase Manhattan Bank, as trustee (incorporated by reference to Form S-3 (No. 33-50933) filed May 15, 1996).

4.2 Seventh Supplemental Indenture dated as of May 16, 2012 by and among the Company, the Guarantors and The Bank of New York Mellon Trust Company, N.A., as successor to JPMorgan Chase Bank, N.A., formerly known as The Chase Manhattan Bank, as trustee.

4.3 Form of 1.625% Convertible Senior Note due 2018 (included in Exhibit 4.2).

4.4 Form of Guarantee of 1.625% Convertible Senior Note due 2018 (included in Exhibit 4.2).

5.1 Opinion of DLA Piper LLP (US) dated May 16, 2012.

23.1 Consent of DLA Piper LLP (US) (included in Exhibit 5.1).

25.1 Statement of Eligibility of The Bank of New York Mellon Trust Company, N.A., to act as trustee under the Indenture (incorporated by reference to Form S-3 (No. 333-179206 filed January 27, 2012)).

99.1 Press release dated May 16, 2012.