notes payable in our accompanying consolidated financial statements include $ 76.5 million which is the fair value of the $ 85.0 million aggregate principal amount of convertible notes issued ; the fair value was determined using a discount rate of 6.6 % 31 based on the rate of return investors would require for a similar liability , and reflects an $ 8.5 million discount . $ 5.5 million of the remaining proceeds was recorded to additional paid-in capital to reflect the equity component of the convertible notes and $ 3.0 million was recorded as a deferred tax liability . the carrying amount of the convertible notes is being accreted over the term to maturity . the net proceeds from the offering were approximately $ 82.0 million . of the $ 3.0 million of debt issuance costs , $ 2.7 million were allocated to the liability component and the remaining $ 0.3 million was allocated as an offset to the equity component of the convertible notes . concurrent with the issuance of the convertible notes , we used approximately $ 16.6 million of the net proceeds to repurchase 1.0 million shares of our common stock . on october 2 , 2014 , we acquired certain real estate assets owned by oakmont in charlotte , north carolina for a purchase price of approximately $ 17.3 million , consisting of approximately $ 15.2 million , in cash and an earnout to be paid based on home closings through december 31 , 2017 . 32 results of operations the following table sets forth our results of operations for the periods indicated : replace_table_token_6_th ( 1 ) earnings per share is presented for the year ended december 31 , 2014 and the period from november 13 , 2013 ( date of closing of ipo ) to december 31 , 2013. see note 11- “ equity ” to our consolidated financial statements included in part ii , item 8 of this annual report for calculation of earnings per share . ( 2 ) gross margin is home sales revenues less cost of sales . ( 3 ) calculated as a percentage of home sales revenues . ( 4 ) adjusted gross margin is a non-gaap financial measure used by management as a supplemental measure in evaluating operating performance . we define adjusted gross margin as gross margin less capitalized interest and adjustments resulting from the application of purchase accounting included in the cost of sales . our management believes this information is useful because it isolates the impact 33 that capitalized interest and purchase accounting adjustments have on gross margin . however , because adjusted gross margin information excludes capitalized interest and purchase accounting adjustment , which have real economic effects and could impact our results , the utility of adjusted gross margin information as a measure of our operating performance may be limited . in addition , other companies may not calculate adjusted gross margin information in the same manner that we do . accordingly , adjusted gross margin information should be considered only as a supplement to gross margin information as a measure of our performance . please see “ —non-gaap measures—adjusted gross margin ” for a reconciliation of adjusted gross margin to gross margin , which is the gaap financial measure that our management believes to be most directly comparable . ( 5 ) adjusted ebitda is a non-gaap financial measure used by management as a supplemental measure in evaluating operating performance . we define adjusted ebitda as net income before ( i ) interest expense , ( ii ) income taxes , ( iii ) depreciation and amortization , ( iv ) capitalized interest charged to the cost of sales , ( v ) other income , net and ( vi ) adjustments resulting from the application of purchase accounting . our management believes that the presentation of adjusted ebitda provides useful information to investors regarding our results of operations because it assists both investors and management in analyzing and benchmarking the performance and value of our business . adjusted ebitda provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates , levels of depreciation or amortization and items considered to be non-recurring . accordingly , our management believes that this measurement is useful for comparing general operating performance from period to period . other companies may define adjusted ebitda differently and , as a result , our measure of adjusted ebitda may not be directly comparable to adjusted ebitda of other companies . although we use adjusted ebitda as a financial measure to assess the performance of our business , the use of adjusted ebitda is limited because it does not include certain costs , such as interest and taxes , necessary to operate our business . adjusted ebitda should be considered in addition to , and not as a substitute for , net income in accordance with gaap as a measure of performance . our presentation of adjusted ebitda should not be construed as an indication that our future results will be unaffected by unusual or nonrecurring items . our adjusted ebitda is limited as an analytical tool , and you should not consider it in isolation or as a substitute for analysis of our results as reported under gaap . please see “ —non-gaap measures—adjusted ebitda ” for a reconciliation of adjusted ebitda to net income , which is the gaap financial measure that our management believes to be most directly comparable . 34 year ended december 31 , 2014 compared to year ended december 31 , 2013 homes sales . our home sales revenues and closings by division for the year ended december 31 , 2014 and 2013 were as follows ( dollars in thousands ) : replace_table_token_7_th home sales revenues for the year ended december 31 , 2014 were $ 383.3 million , an increase of $ 223.2 million , or 139.4 % , from $ 160.1 story_separator_special_tag 38 unaudited pro forma statement of operations for the year ended december 31 , 2013 replace_table_token_9_th ( 1 ) this column is a combination of the financial statements of lgi-gtis holdings , llc , lgi-gtis holdings ii , llc , lgi-gtis holdings iii , llc and lgi-gtis holdings iv , llc , for the period january 1 , 2013 through november 13 , 2013. notes to unaudited pro forma statement of operations for year ended december 31 , 2013 ( a ) eliminates our predecessor 's equity in the income of the lgi/gtis joint ventures . ( b ) reflects amortization of the $ 0.7 million marketing related intangible asset ( i.e . , trade name rights ) recorded in the gtis acquisitions . the trade name rights have an estimated useful life of three years based upon the timing of the majority of the forecasted revenues to be earned over the remaining development cycle of the lgi/gtis joint ventures ' communities . amortization is recorded on a straight-line basis . pro forma amortization expense was $ 0.2 million for the year ended december 31 , 2013 . ( c ) reflects the elimination of $ 2.7 million of management and warranty fees our predecessor charged to the lgi/gtis joint ventures during the period pursuant to certain management services agreements . the applicable management services agreements were terminated in connection with the gtis acquisitions . the corresponding charges of $ 2.5 million and $ 0.2 million were recorded to general and administrative expense and cost of sales , respectively , by the lgi/gtis joint ventures . ( d ) represents the elimination of gain on remeasurement of our predecessor 's equity interests in the lgi/gtis joint ventures in connection with the gtis acquisitions . the gain on remeasurement represents the predecessor 's equity interests at fair value less the carrying value of predecessor 's equity interest using the equity method of accounting . 39 unaudited pro forma statement of operations for the year ended december 31 , 2012 replace_table_token_10_th ( 1 ) this column is a combination of the financial statements of lgi-gtis holdings , llc , lgi-gtis holdings ii , llc , lgi-gtis holdings iii , llc and lgi-gtis holdings iv , llc , . notes to unaudited pro forma statement of operations for year ended december 31 , 2012 ( a ) eliminates our predecessor 's equity in the income of the lgi/gtis joint ventures . ( b ) reflects amortization of the $ 0.7 million marketing related intangible asset ( i.e . , trade name rights ) recorded in the gtis acquisitions . the trade name rights have an estimated useful life of three years based upon the timing of the majority of the forecasted revenues to be earned over the remaining development cycle of the lgi/gtis joint ventures ' communities . amortization is recorded on a straight-line basis . pro forma amortization expense was $ 0.2 million for the year ended december 31 , 2012 . ( c ) reflects the elimination of $ 2.4 million of management and warranty fees our predecessor charged to the lgi/gtis joint ventures during the period pursuant to certain management services agreements . the applicable management services agreements were terminated in connection with the gtis acquisitions . the corresponding charges of $ 2.3 million and $ 0.1 million were recorded to general and administrative expense and cost of sales , respectively , by the lgi/gtis joint ventures . 40 supplemental management 's discussion and analysis year ended december 31 , 2014 compared to pro forma year ended december 31 , 2013 pro forma homes sales . our home sales revenues and closings by division for the year ended december 31 , 2014 and pro forma home sales revenues and closings by division for the year ended december 31 , 2013 were as follows ( dollars in thousands , except average sales price ) : replace_table_token_11_th replace_table_token_12_th ( 1 ) gross margin is home sales revenues less cost of sales . ( 2 ) calculated as a percentage of home sales revenues . home sales revenues for the year ended december 31 , 2014 were $ 383.3 million , an increase of $ 142.3 million , or 59.1 % , from pro forma home sales revenues of $ 241.0 million for the year ended december 31 , 2013. the increase in home sales revenues is primarily due to a 45.7 % increase in homes closed and an increase in the average home sales price per home during the year ended december 31 , 2014 as compared to year ended december 31 , 2013 , on a pro forma basis . we closed 2,356 homes during the year ended december 31 , 2014 , an increase of 739 homes closed , or 45.7 % , over the 1,617 homes closed on a pro forma basis for the year ended december 31 , 2013. this increase was primarily due to more active communities in 2014. the average home sales price for the year ended december 31 , 2014 was $ 162,677 , an increase of $ 13,659 , or 9.2 % , from the pro forma average home sales price of $ 149,018 for year ended december 31 , 2013. this increase was primarily due to changes in product mix and a generally favorable pricing environment . pro forma cost of sales and gross margin ( pro forma home sales revenues less pro forma cost of sales ) . cost of sales for the year ended december 31 , 2014 was $ 280.5 million , an increase of $ 100.7 million , or 56.0 % , from pro forma cost of sales of $ 179.8 million for the year ended december 31 , 2013. this increase is primarily due to a 739 -unit , or 45.7 % , increase in homes closed for the year ended december 31 , 2014 as compared to homes closed on a pro forma basis for the year

cash flows year ended december 31 , 2014 compared to year ended december 31 , 2013 net cash used in operating activities during the year ended december 31 , 2014 was $ 173.2 million as compared to $ 54.5 million during the year ended december 31 , 2013. the $ 118.7 million increase in net cash used in operating activities was primarily attributable to a $ 123.8 million net increase in real estate inventory for the year ended december 31 , 2014 as compared to the year ended december 31 , 2013. we made land and finished lot purchases in all of our divisions with the majority of purchases in texas . net cash used in operating activities is partially offset by an $ 6.5 million increase in net income in 2014. net cash used in investing activities during the year ended december 31 , 2014 was $ 16.4 million as compared to $ 31.3 million used in investing activities during the year ended december 31 , 2013. net cash used of $ 15.2 million was associated with the oakmont acquisition during the year ended december 31 , 2014 as compared to net cash payment of $ 30.1 million during the year ended december 31 , 2013 associated with the gtis acquisitions .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows year ended december 31 , 2014 compared to year ended december 31 , 2013 net cash used in operating activities during the year ended december 31 , 2014 was $ 173.2 million as compared to $ 54.5 million during the year ended december 31 , 2013. the $ 118.7 million increase in net cash used in operating activities was primarily attributable to a $ 123.8 million net increase in real estate inventory for the year ended december 31 , 2014 as compared to the year ended december 31 , 2013. we made land and finished lot purchases in all of our divisions with the majority of purchases in texas . net cash used in operating activities is partially offset by an $ 6.5 million increase in net income in 2014. net cash used in investing activities during the year ended december 31 , 2014 was $ 16.4 million as compared to $ 31.3 million used in investing activities during the year ended december 31 , 2013. net cash used of $ 15.2 million was associated with the oakmont acquisition during the year ended december 31 , 2014 as compared to net cash payment of $ 30.1 million during the year ended december 31 , 2013 associated with the gtis acquisitions .
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 Suspicious Activity Report : notes payable in our accompanying consolidated financial statements include $ 76.5 million which is the fair value of the $ 85.0 million aggregate principal amount of convertible notes issued ; the fair value was determined using a discount rate of 6.6 % 31 based on the rate of return investors would require for a similar liability , and reflects an $ 8.5 million discount . $ 5.5 million of the remaining proceeds was recorded to additional paid-in capital to reflect the equity component of the convertible notes and $ 3.0 million was recorded as a deferred tax liability . the carrying amount of the convertible notes is being accreted over the term to maturity . the net proceeds from the offering were approximately $ 82.0 million . of the $ 3.0 million of debt issuance costs , $ 2.7 million were allocated to the liability component and the remaining $ 0.3 million was allocated as an offset to the equity component of the convertible notes . concurrent with the issuance of the convertible notes , we used approximately $ 16.6 million of the net proceeds to repurchase 1.0 million shares of our common stock . on october 2 , 2014 , we acquired certain real estate assets owned by oakmont in charlotte , north carolina for a purchase price of approximately $ 17.3 million , consisting of approximately $ 15.2 million , in cash and an earnout to be paid based on home closings through december 31 , 2017 . 32 results of operations the following table sets forth our results of operations for the periods indicated : replace_table_token_6_th ( 1 ) earnings per share is presented for the year ended december 31 , 2014 and the period from november 13 , 2013 ( date of closing of ipo ) to december 31 , 2013. see note 11- “ equity ” to our consolidated financial statements included in part ii , item 8 of this annual report for calculation of earnings per share . ( 2 ) gross margin is home sales revenues less cost of sales . ( 3 ) calculated as a percentage of home sales revenues . ( 4 ) adjusted gross margin is a non-gaap financial measure used by management as a supplemental measure in evaluating operating performance . we define adjusted gross margin as gross margin less capitalized interest and adjustments resulting from the application of purchase accounting included in the cost of sales . our management believes this information is useful because it isolates the impact 33 that capitalized interest and purchase accounting adjustments have on gross margin . however , because adjusted gross margin information excludes capitalized interest and purchase accounting adjustment , which have real economic effects and could impact our results , the utility of adjusted gross margin information as a measure of our operating performance may be limited . in addition , other companies may not calculate adjusted gross margin information in the same manner that we do . accordingly , adjusted gross margin information should be considered only as a supplement to gross margin information as a measure of our performance . please see “ —non-gaap measures—adjusted gross margin ” for a reconciliation of adjusted gross margin to gross margin , which is the gaap financial measure that our management believes to be most directly comparable . ( 5 ) adjusted ebitda is a non-gaap financial measure used by management as a supplemental measure in evaluating operating performance . we define adjusted ebitda as net income before ( i ) interest expense , ( ii ) income taxes , ( iii ) depreciation and amortization , ( iv ) capitalized interest charged to the cost of sales , ( v ) other income , net and ( vi ) adjustments resulting from the application of purchase accounting . our management believes that the presentation of adjusted ebitda provides useful information to investors regarding our results of operations because it assists both investors and management in analyzing and benchmarking the performance and value of our business . adjusted ebitda provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates , levels of depreciation or amortization and items considered to be non-recurring . accordingly , our management believes that this measurement is useful for comparing general operating performance from period to period . other companies may define adjusted ebitda differently and , as a result , our measure of adjusted ebitda may not be directly comparable to adjusted ebitda of other companies . although we use adjusted ebitda as a financial measure to assess the performance of our business , the use of adjusted ebitda is limited because it does not include certain costs , such as interest and taxes , necessary to operate our business . adjusted ebitda should be considered in addition to , and not as a substitute for , net income in accordance with gaap as a measure of performance . our presentation of adjusted ebitda should not be construed as an indication that our future results will be unaffected by unusual or nonrecurring items . our adjusted ebitda is limited as an analytical tool , and you should not consider it in isolation or as a substitute for analysis of our results as reported under gaap . please see “ —non-gaap measures—adjusted ebitda ” for a reconciliation of adjusted ebitda to net income , which is the gaap financial measure that our management believes to be most directly comparable . 34 year ended december 31 , 2014 compared to year ended december 31 , 2013 homes sales . our home sales revenues and closings by division for the year ended december 31 , 2014 and 2013 were as follows ( dollars in thousands ) : replace_table_token_7_th home sales revenues for the year ended december 31 , 2014 were $ 383.3 million , an increase of $ 223.2 million , or 139.4 % , from $ 160.1 story_separator_special_tag 38 unaudited pro forma statement of operations for the year ended december 31 , 2013 replace_table_token_9_th ( 1 ) this column is a combination of the financial statements of lgi-gtis holdings , llc , lgi-gtis holdings ii , llc , lgi-gtis holdings iii , llc and lgi-gtis holdings iv , llc , for the period january 1 , 2013 through november 13 , 2013. notes to unaudited pro forma statement of operations for year ended december 31 , 2013 ( a ) eliminates our predecessor 's equity in the income of the lgi/gtis joint ventures . ( b ) reflects amortization of the $ 0.7 million marketing related intangible asset ( i.e . , trade name rights ) recorded in the gtis acquisitions . the trade name rights have an estimated useful life of three years based upon the timing of the majority of the forecasted revenues to be earned over the remaining development cycle of the lgi/gtis joint ventures ' communities . amortization is recorded on a straight-line basis . pro forma amortization expense was $ 0.2 million for the year ended december 31 , 2013 . ( c ) reflects the elimination of $ 2.7 million of management and warranty fees our predecessor charged to the lgi/gtis joint ventures during the period pursuant to certain management services agreements . the applicable management services agreements were terminated in connection with the gtis acquisitions . the corresponding charges of $ 2.5 million and $ 0.2 million were recorded to general and administrative expense and cost of sales , respectively , by the lgi/gtis joint ventures . ( d ) represents the elimination of gain on remeasurement of our predecessor 's equity interests in the lgi/gtis joint ventures in connection with the gtis acquisitions . the gain on remeasurement represents the predecessor 's equity interests at fair value less the carrying value of predecessor 's equity interest using the equity method of accounting . 39 unaudited pro forma statement of operations for the year ended december 31 , 2012 replace_table_token_10_th ( 1 ) this column is a combination of the financial statements of lgi-gtis holdings , llc , lgi-gtis holdings ii , llc , lgi-gtis holdings iii , llc and lgi-gtis holdings iv , llc , . notes to unaudited pro forma statement of operations for year ended december 31 , 2012 ( a ) eliminates our predecessor 's equity in the income of the lgi/gtis joint ventures . ( b ) reflects amortization of the $ 0.7 million marketing related intangible asset ( i.e . , trade name rights ) recorded in the gtis acquisitions . the trade name rights have an estimated useful life of three years based upon the timing of the majority of the forecasted revenues to be earned over the remaining development cycle of the lgi/gtis joint ventures ' communities . amortization is recorded on a straight-line basis . pro forma amortization expense was $ 0.2 million for the year ended december 31 , 2012 . ( c ) reflects the elimination of $ 2.4 million of management and warranty fees our predecessor charged to the lgi/gtis joint ventures during the period pursuant to certain management services agreements . the applicable management services agreements were terminated in connection with the gtis acquisitions . the corresponding charges of $ 2.3 million and $ 0.1 million were recorded to general and administrative expense and cost of sales , respectively , by the lgi/gtis joint ventures . 40 supplemental management 's discussion and analysis year ended december 31 , 2014 compared to pro forma year ended december 31 , 2013 pro forma homes sales . our home sales revenues and closings by division for the year ended december 31 , 2014 and pro forma home sales revenues and closings by division for the year ended december 31 , 2013 were as follows ( dollars in thousands , except average sales price ) : replace_table_token_11_th replace_table_token_12_th ( 1 ) gross margin is home sales revenues less cost of sales . ( 2 ) calculated as a percentage of home sales revenues . home sales revenues for the year ended december 31 , 2014 were $ 383.3 million , an increase of $ 142.3 million , or 59.1 % , from pro forma home sales revenues of $ 241.0 million for the year ended december 31 , 2013. the increase in home sales revenues is primarily due to a 45.7 % increase in homes closed and an increase in the average home sales price per home during the year ended december 31 , 2014 as compared to year ended december 31 , 2013 , on a pro forma basis . we closed 2,356 homes during the year ended december 31 , 2014 , an increase of 739 homes closed , or 45.7 % , over the 1,617 homes closed on a pro forma basis for the year ended december 31 , 2013. this increase was primarily due to more active communities in 2014. the average home sales price for the year ended december 31 , 2014 was $ 162,677 , an increase of $ 13,659 , or 9.2 % , from the pro forma average home sales price of $ 149,018 for year ended december 31 , 2013. this increase was primarily due to changes in product mix and a generally favorable pricing environment . pro forma cost of sales and gross margin ( pro forma home sales revenues less pro forma cost of sales ) . cost of sales for the year ended december 31 , 2014 was $ 280.5 million , an increase of $ 100.7 million , or 56.0 % , from pro forma cost of sales of $ 179.8 million for the year ended december 31 , 2013. this increase is primarily due to a 739 -unit , or 45.7 % , increase in homes closed for the year ended december 31 , 2014 as compared to homes closed on a pro forma basis for the year

