HORTON D R INC /DE/ (Form: 8-K, Received: 05/01/2012 06:15:36)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 25, 2012

D.R. Horton, Inc.

(Exact name of registrant as specified in its charter)

Delaware

1-14122

75-2386963

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

301 Commerce Street, Suite 500, Fort Worth, Texas 76102

(Address of principal executive offices)

Registrant’s telephone number, including area code: (817) 390-8200

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01.

Other Events.

On April 25, 2012, D.R. Horton, Inc. (the “Company”) and the Guarantors (as defined below) entered into an underwriting agreement (the “Underwriting Agreement”) with Citigroup Global Markets Inc. as representative of the underwriters named therein, with respect to the offering and sale in an underwritten public offering (the “Offering”) by the Company of $350 million aggregate principal amount of its 4.750% Senior Notes due 2017 (the “Notes”).

The Offering has been registered under the Securities Act pursuant to a registration statement on Form S-3, File No. 333-162123 (the “Registration Statement”) of the Company and certain direct and indirect wholly-owned subsidiaries of the Company listed as co-registrants thereto (the “ Guarantors ”) and the prospectus supplement dated April 25, 2012 and filed with the Securities and Exchange Commission pursuant to Rule 424(b) of the Securities Act of 1933, as amended, on April 26, 2012. The Offering is expected to close on May 1, 2012, subject to customary closing conditions. Certain legal opinions relating to the Registration Statement are also filed herewith as Exhibits 5.1 and 5.2.

The Notes will be issued pursuant to an Indenture (the “Base Indenture”) between the Company and American Stock Transfer & Trust Company, LLC, as trustee (the “Trustee”), as supplemented by the First Supplemental Indenture (the “Supplemental Indenture”), between the Company, the Guarantors and the Trustee. The Notes will be represented by a global security, which is included as an exhibit to the Supplemental Indenture. The form of Base Indenture, the form of Supplemental Indenture and the form of the Notes are filed as Exhibits to this Current Report on Form 8-K and are incorporated herein by reference.

The Company intends to use the net proceeds from the Offering for general corporate purposes.

Item 9.01.

Financial Statements and Exhibits.

(c)	Exhibits.


1.1		Underwriting Agreement, dated as of April 25, 2012, among D.R. Horton, Inc., the Guarantors named therein and Citigroup Global Markets Inc., as representative of the underwriters named therein.

4.1		Form of Base Indenture, between D.R. Horton, Inc. and American Stock Transfer & Trust Company, LLC, as trustee.

4.2		Form of Supplemental Indenture, among D.R. Horton, Inc., the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as trustee.

4.3		Form of 4.750% Senior Notes due 2017 (included in Exhibit 4.2).

5.1		Opinion of Thomas B. Montano, Esquire.

5.2		Opinion of Gibson, Dunn & Crutcher LLP.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 1, 2012


D.R. Horton, Inc.

By:		/s/ Thomas B. Montano
		Thomas B. Montano
		Vice President and Assistant Secretary

EXHIBIT INDEX


Exhibit Number		Exhibit

1.1		Underwriting Agreement, dated as of April 25, 2012, among D.R. Horton, Inc., the Guarantors named therein and Citigroup Global Markets Inc., as representative of the underwriters named therein.

4.1		Form of Base Indenture, between D.R. Horton, Inc. and American Stock Transfer & Trust Company, LLC, as trustee.

4.2		Form of Supplemental Indenture, among D.R. Horton, Inc., the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as trustee.

4.3		Form of 4.750% Senior Notes due 2017 (included in Exhibit 4.2).

5.1		Opinion of Thomas B. Montano, Esquire.

5.2		Opinion of Gibson, Dunn & Crutcher LLP.

Exhibit 1.1

EXECUTION VERSION

D.R. HORTON, INC.

$350,000,000 4.750% Senior Notes due 2017

UNDERWRITING AGREEMENT

April 25, 2012

Citigroup Global Markets Inc.

As Representative of the several Underwriters

listed in Schedule A hereto

c/o Citigroup Global Markets Inc.

388 Greenwich Street

New York, New York 10013

Ladies and Gentlemen:

D.R. Horton, Inc., a Delaware corporation (the “ Company ”), proposes to issue and sell $350,000,000 aggregate principal amount of its 4.750% Senior Notes due 2017 (the “ Notes ”) to Citigroup Global Markets Inc. (the “ Representative ”) and the other underwriters listed on Schedule A hereto (each, an “ Underwriter ” and collectively, the “ Underwriters ”). The Notes are to be issued pursuant to the provisions of an Indenture to be dated as of the Closing Date (the “ Base Indenture ”) and a supplemental indenture to be dated as of the Closing Date (the “ Supplemental Indenture ,” and together with the Base Indenture, the “ Indenture ”) among the Company, the Guarantors (as defined below) and American Stock Transfer & Trust Company, LLC, as trustee (the “ Trustee ”). The Company’s obligations under the Indenture and the Notes will be unconditionally guaranteed (the “ Guarantees ”), jointly and severally, by each of the subsidiaries of the Company listed on the signature pages hereof (the “ Guarantors ”). The Company and the Guarantors are collectively referred to herein as the “ Issuers ,” and the Notes and the Guarantees are collectively referred to herein as the “ Securities .”

1. Registration Statement and Prospectus . The Company has prepared and filed with the Securities and Exchange Commission (the “ Commission ”) in accordance with the provisions of the Securities Act of 1933, as amended, and the published rules and regulations of the Commission thereunder (collectively, the “ Act ”), a registration statement on Form S-3 (No. 333-162123), including a base prospectus relating to the Securities. The registration statement at the time it became effective on September 24, 2009, including information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430B under the Act, is hereinafter referred to as the “ Registration Statement .” The base prospectus dated September 24, 2009 (the “ Base Prospectus ”), as supplemented by the prospectus supplement dated April 25, 2012 relating to the Securities in the form first used (or made available

upon request of purchasers pursuant to Rule 173 under the Act) in connection with confirmation of sales of the Securities (the “ Prospectus Supplement ”) is hereinafter referred to as the “ Prospectus .” The Base Prospectus, as supplemented by the preliminary prospectus supplement dated April 25, 2012 relating to the Securities and used prior to the filing of the Prospectus (the “ Preliminary Prospectus Supplement ”) is hereinafter referred to as the “ Preliminary Prospectus .” Any reference herein to the Registration Statement, the Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Act, as of the effective date of the Registration Statement or the date of the Preliminary Prospectus or the Prospectus (the “ Incorporated Documents ”), and, except as otherwise indicated, when reference is made to information “in” (including by use of the terms “set forth in,” “described in” and similar terms) the Preliminary Prospectus, the Prospectus or the Registration Statement, such reference shall be deemed to include information incorporated by reference in the Preliminary Prospectus, the Prospectus or the Registration Statement, as the case may be.

At or prior to 12:30 p.m. (Eastern time) on April 25, 2012, the time you have informed us as the time when sales of the Securities may be first made by the Underwriters in the offering (the “ Time of Sale ”), the following information (collectively with the information referred to in the next succeeding sentence, the “ Time of Sale Information ”) was delivered in connection with such sales or was filed with the Commission: the Preliminary Prospectus and each “free writing prospectus” (as defined pursuant to Rule 405 under the Act) listed on Exhibit A hereto.

2. Agreements To Sell and Purchase . The Company agrees to issue and sell, and, on the basis of the representations and warranties contained in this Underwriting Agreement (the “ Agreement ”) and subject to its terms and conditions, each Underwriter agrees, severally and not jointly, to purchase from the Company the aggregate principal amount of the Notes set forth opposite such Underwriter’s name on Schedule A hereto at an aggregate purchase price of 99.250% of the principal amount of the Notes ($347,375,000), plus accrued interest, if any, from May 1, 2012 to the date of payment and delivery (collectively, the “ Purchase Price ”).

3. Terms of Public Offering . The Company is advised by the Underwriters that the Underwriters propose to make a public offering of the Securities as soon after the execution and delivery of this Agreement as in the judgment of the Underwriters is advisable on the basis set forth in the Time of Sale Information and the Prospectus. The Company acknowledges and agrees that the Underwriters may offer and sell Securities to or through any affiliate of an Underwriter for the purpose of any offers and sales of Securities outside the United States.

4. Delivery and Payment . Delivery to the Underwriters of and payment for the Securities shall be made at 10:00 A.M., New York City time, on May 1, 2012 (the “ Closing Date ”), at such place as you shall designate. The Closing Date and the location of delivery of and the form of payment for the Securities may be varied by agreement between you and the Company.

Certificates for the Securities shall be registered in such names and issued in such denominations as you shall request in writing not later than two full business days prior to the

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Closing Date. Such certificates shall be made available to you for inspection not later than 9:30 A.M., New York City time, on the business day next preceding the Closing Date. Certificates in definitive form evidencing the Securities shall be delivered to you on the Closing Date with any transfer taxes thereon duly paid by the Company, for the account of the Underwriters, against payment of the Purchase Price therefor by wire or certified or official bank checks payable in Federal funds to the order of the Company. If the Securities will be issued in book-entry form, the Company shall deposit the global certificate(s) representing the Securities with The Depository Trust Company (“ DTC ”), or its designated custodian, on the Closing Date, and the Company will deliver such global certificate(s) to the Underwriters by causing DTC to credit the Securities to the accounts of the Underwriters at DTC against payment therefor as set forth above.

5. Agreements of the Issuers . The Issuers, jointly and severally, agree with each Underwriter as follows:

(a) The Company will comply fully and in a timely manner with the applicable provisions of Rule 424 and Rule 430B under the Act and will file any Issuer Free Writing Prospectus (as defined in Section 6(c)) to the extent required by Rule 433 under the Act.

(b) The Issuers will advise you promptly and, if requested by you, will confirm such advice in writing: (i) of the effectiveness of any amendment to the Registration Statement; (ii) of the transmission to the Commission for filing of any supplement to the Prospectus (including any document that would as a result of such filing become an Incorporated Document) or of any Issuer Free Writing Prospectus and to furnish you with copies thereof; (iii) of the receipt of any comments from the Commission that relate to the Registration Statement or of any request by the Commission for amendment of or a supplement to the Registration Statement, the Preliminary Prospectus or the Prospectus or for additional information; (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any order preventing or suspending the use of the Preliminary Prospectus or the Prospectus or of the suspension of qualification of the Securities for offering or sale in any jurisdiction or the initiation or the threatening of any proceeding for such purpose or of the Company’s becoming the subject of a proceeding pursuant to Section 8A of the Act; and (v) within the period of time referred to in paragraph (e) below, of any change in the Company’s condition (financial or other), business, prospects, properties, net worth or results of operations, or of the happening of any event, which makes any statement of a material fact made in the Registration Statement, the Time of Sale Information or the Prospectus (as then amended or supplemented) untrue or which requires the making of any additions to or changes in the Registration Statement, the Time of Sale Information or the Prospectus (as then amended or supplemented) in order to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading, or of the necessity to amend or supplement the Time of Sale Information or the Prospectus (as then amended or supplemented) to comply with the Act or any other law. If at any time any stop order suspending the effectiveness of the Registration Statement or any order preventing or suspending the use of the Preliminary Prospectus, the Prospectus or any Issuer Free Writing Prospectus or suspending any such qualification shall be issued, the Issuers will promptly use their best efforts to obtain the withdrawal of such order at the earliest possible time.

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(c) The Issuers will furnish to you, without charge, (i) five copies of the registration statement as originally filed with the Commission and of each amendment thereto, including all exhibits thereto, (ii) such number of copies of the Preliminary Prospectus, each Issuer Free Writing Prospectus, the Prospectus and any amendment or supplement thereto as you may reasonably request, (iii) such number of copies of the registration statement as originally filed and of each amendment thereto, but without exhibits, as you may request, (iv) such number of copies of the Incorporated Documents, without exhibits, as you may request, and (v) five copies of the exhibits to the Incorporated Documents.

(d) The Issuers will not use or file any Issuer Free Writing Prospectus not included in the Time of Sale Information, file any amendment to the Registration Statement or make any amendment or supplement to the Prospectus or, prior to the end of the period of time referred to in paragraph (e) below, file any document which upon filing becomes an Incorporated Document, of which you shall not previously have been advised or to which, after you shall have received a copy of the document proposed to be used or filed, you shall reasonably object.

(e) As soon as possible after the execution and delivery of this Agreement and thereafter from time to time for such period as in the opinion of counsel for the Underwriters a prospectus is required by the Act to be delivered in connection with sales by any Underwriter or any dealer, the Issuers will expeditiously deliver to the Underwriters and each dealer, without charge, as many copies of the Preliminary Prospectus and the Prospectus (and of any amendment or supplement thereto) and each Issuer Free Writing Prospectus as you may reasonably request. The Issuers consent to the use of the Preliminary Prospectus, any Issuer Free Writing Prospectus, the use of which is permitted hereby, and the Prospectus (and of any amendment or supplement thereto) in accordance with the provisions of the Act and with the securities or blue sky laws of the jurisdictions in which the Securities are offered by any Underwriter and by all dealers to whom Securities may be sold, both in connection with the offering and sale of the Securities and, in the case of the Prospectus, for such period of time thereafter as the Prospectus is required by the Act to be delivered in connection with sales by any Underwriter or any dealer.

(f) (1) If during the period of time referred to in paragraph (e) above any event shall occur as a result of which, in the judgment of the Issuers or the Underwriters, it becomes necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if it is necessary to amend or supplement the Prospectus to comply with the Act or any other law, the Issuers will forthwith prepare and, subject to the provisions of paragraph (d) above, file with the Commission an appropriate amendment or supplement to the Prospectus so that the statements in the Prospectus, as so amended or supplemented, will not, in the light of the circumstances when it is so delivered, be misleading, or so that the Prospectus will comply with law, and to furnish to the

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Underwriters and to such dealers as you shall specify such number of copies thereof as the Underwriters or such dealers may reasonably request and (2) if at any time prior to the Time of Sale (i) any event shall occur or condition shall exist as a result of which, in the judgment of the Issuers or the Underwriters, the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with the Act or any other law, the Issuers will forthwith prepare and, subject to the provisions of paragraph (d) above, file with the Commission (to the extent required) an appropriate amendment or supplement to the Time of Sale Information so that the statements in the Time of Sale Information, as so amended or supplemented, will not, in the light of the circumstances when it is so delivered, be misleading, or so that the Time of Sale Information will comply with law, and to furnish to the Underwriters and to such dealers as you shall specify such number of copies thereof as the Underwriters or such dealers may reasonably request.

(g) The Issuers will cooperate with you and with counsel for the Underwriters in connection with the registration or qualification of the Securities for offering and sale by the Underwriters and by dealers under the securities or Blue Sky laws of such jurisdictions as you may designate and will file such consents to service of process or other documents necessary or appropriate in order to effect such registration or qualification; provided , however , that in no event shall any Issuer be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Securities, in any jurisdiction where it is not now so subject.

(h) The Issuers will make generally available to its security holders a consolidated earnings statement, which need not be audited, covering a twelve-month period commencing after the date of the Prospectus and ending not later than 15 months thereafter, as soon as practicable after the end of such period, which consolidated earnings statement shall satisfy the provisions of Section 11(a) of the Act and Rule 158 thereunder, and will advise you in writing when such statement has been made available.

(i) During the period of five years hereafter, the Issuers will furnish to you as soon as available, to the extent not otherwise available on the Commission’s website, a copy of all public materials furnished by the Company to its stockholders and all public reports and financial statements furnished by the Company to the principal national securities exchange upon which the common stock of the Company may be listed pursuant to requirements of or agreements with such exchange or to the Commission.

(j) The Company will apply the net proceeds from the sale of the Securities in accordance with the description set forth in the Time of Sale Information and the Prospectus under the caption “Use of Proceeds.”

(k) Neither the Company nor any of its subsidiaries has taken, or will take, directly or indirectly, any action designed to or that might reasonably be expected to cause or result in stabilization or manipulation of the price of the Securities to facilitate the sale or resale of the Securities.

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(l) The Issuers will pay all costs, expenses, fees and taxes incident to (i) the preparation, printing, filing and distribution under the Act of the Registration Statement (including financial statements and exhibits), and all amendments and supplements thereto prior to or during the period specified in paragraph (e) above, (ii) the preparation of the Indenture, the issuance of the Notes and the fees of the Trustee, (iii) the printing and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Preliminary Prospectus, each Issuer Free Writing Prospectus, the Prospectus and all amendments or supplements thereto during the period specified in paragraph (e) above, (iv) the printing and delivery of this Agreement, the Preliminary and Supplemental Blue Sky Memoranda and all other agreements, memoranda, correspondence and other documents printed and delivered in connection with the offering of the Securities (including in each case any disbursements of counsel for the Underwriters relating to such printing and delivery), (v) the registration or qualification of the Securities for offer and sale under the securities or Blue Sky laws of the several states (including in each case the reasonable fees and disbursements of counsel for the Underwriters relating to such registration or qualification and memoranda relating thereto), (vi) filings and clearance with the Financial Industry Regulatory Authority in connection with the offering (including the reasonable fees and disbursements of counsel for the Underwriters relating thereto), (vii) the listing, if any, of the Securities on any national securities exchange and (viii) furnishing such copies of the Registration Statement, the Preliminary Prospectus, each Issuer Free Writing Prospectus, the Prospectus and all amendments and supplements thereto as may be requested for use in connection with the offering or sale of the Securities by the Underwriters or by dealers to whom Securities may be sold.

(m) The Issuers will not during the period beginning on the date hereof and continuing to and including the date which is 30 days after the date hereof, offer, sell, contract to sell or otherwise dispose of any debt securities of any of the Issuers or any warrants, options or other rights to purchase or acquire debt securities of any of the Issuers or any securities convertible into or exchangeable for debt securities of any of the Issuers (other than the Securities), without the prior written consent of the Representative.

(n) The Issuers will use their best efforts to do and perform all things required or necessary to be done and performed under this Agreement by the Issuers prior to the Closing Date and to satisfy all conditions precedent to the delivery of the Securities.

(o) The Company will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission in accordance with Rule 433 under the Act.

6. Representations and Warranties of the Issuers . The Issuers, jointly and severally, represent and warrant to each Underwriter that:

(a) Each preliminary prospectus included as part of the registration statement as originally filed or as part of any amendment or supplement thereto, or filed pursuant to

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Rule 424 under the Act, complied when so filed in all material respects with the provisions of the Act. The Commission has not issued any order preventing or suspending the use of any preliminary prospectus.

(b) The Time of Sale Information at the Time of Sale did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , however , that no representation or warranty is made as to information relating to an Underwriter contained in or omitted from the Time of Sale Information in reliance upon and in conformity with written information furnished to the Issuers by or on behalf of such Underwriter specifically for inclusion therein.

(c) The Company (including its agents and representatives, other than the Underwriters in their capacity as such) has not prepared, made, used, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in Rule 405 under the Act) that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company or its agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “ Issuer Free Writing Prospectus ”) other than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Act or Rule 134 under the Act, (ii) the Preliminary Prospectus, (iii) the Prospectus, (iv) the documents listed on Exhibit A hereto as constituting the Time of Sale Information and (v) any electronic road show or other written communications, in each case approved in writing in advance by the Representative. Each such Issuer Free Writing Prospectus complied in all material respects with the Act, has been or will be (within the time period specified in Rule 433) filed in accordance with the Act (to the extent required thereby) and, when taken together with the Time of Sale Information accompanying, or delivered prior to delivery of, such Issuer Free Writing Prospectus, did not, and at the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation and warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus in reliance upon and in conformity with information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representative expressly for use in any Issuer Free Writing Prospectus.

(d) The Company was at the time of initial filing of the Registration Statement and at the time of the most recent amendment thereto for purposes of complying with Section 10(a)(3) of the Act, a “well-known seasoned issuer” (as defined in Rule 405 under the Act) eligible to use Form S-3 for the offering of the Securities, including not having been an “ineligible issuer” (as defined in Rule 405 under the Act) at any such time or date. The Registration Statement is an “automatic shelf registration statement” (as defined in Rule 405 under the Act) and was filed not earlier than the date that is three years prior to the applicable Closing Date (as defined in Section 4). The Registration Statement has become effective and at the date of the Prospectus (if different), including at the

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date of any post-effective amendment or supplement, the Registration Statement will comply in all material respects with the provisions of the Act, and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; the Prospectus (and any supplements or amendments thereto) will at all such times comply in all material respects with the provisions of the Act and will not at any such time contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , however , that no representation or warranty is made as to information relating to an Underwriter contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in conformity with written information furnished to the Issuers by or on behalf of such Underwriter specifically for inclusion therein.

(e) The Incorporated Documents, at the time they were filed with the Commission complied, or, to the extent such documents were subsequently amended prior to the date hereof, at the time so amended complied, in all material respects with the requirements of the Act or the Securities Exchange Act of 1934, as amended, and the published rules and regulations of the Commission thereunder (collectively, the “ Exchange Act ”), as applicable, and such documents do not on the date hereof, and will not at the Closing Date, contain an untrue statement of a material fact and do not on the date hereof, and will not at the Time of Sale or on any Closing Date, omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(f) The financial statements (including the related notes and supporting schedules) in the Registration Statement, the Time of Sale Information and the Prospectus present fairly in all material respects the consolidated financial position and results of operations of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved, except for changes in accounting principles described therein.

(g) PricewaterhouseCoopers LLP, who has reported on the financial statements of the Company, is a registered independent public accounting firm with respect to the Company and its subsidiaries as required by the Act and, to the Company’s knowledge, is not in violation of the auditor independence requirements of the Sarbanes-Oxley Act of 2002 and the rules and regulations adopted pursuant thereto.

(h) The Company and each of its subsidiaries have been duly formed and are validly existing in good standing under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification except where the failure to so qualify, singly or in the aggregate, would not have a Material Adverse Effect, and have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged. A “ Material Adverse Effect ” means any material adverse effect on the financial condition, results of operations, business or prospects of the Company and its subsidiaries taken as a whole.

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(i) The Company has an authorized capitalization as set forth in the Time of Sale Information and the Prospectus; and all of the issued equity interests of each subsidiary of the Company have been duly authorized and validly issued and, as to shares of capital stock of any corporation constituting a subsidiary, are fully paid and non-assessable and (except for directors’ qualifying shares as disclosed in the Registration Statement and the Time of Sale Information or minority interests in non-Guarantor subsidiaries) are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, security interests, equities or any other claim of any third party other than restrictions on transfer imposed by applicable securities laws.

(j) The execution, delivery and performance of this Agreement, the Indenture and the Securities by the Issuers, compliance by the Issuers of all the provisions hereof and thereof and the consummation of the transactions contemplated hereby will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other material agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such actions result in any violation of the provisions of the organizational documents of the Company or any of its subsidiaries or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their property or assets; and except for such consents, approvals, authorizations, registrations or qualifications as may be required under the Act or applicable state or foreign securities laws in connection with the purchase and distribution of the Securities by any Underwriter, no consent, approval, authorization or order of, or filing or registration with, any such court or governmental agency or body is required for the execution, delivery and performance of this Agreement, the Indenture and the Securities by the Issuers, compliance by the Issuers of all the provisions hereof and thereof and the consummation of the transactions contemplated hereby.

(k) This Agreement has been duly authorized, executed and delivered by the Issuers.

(l) The Indenture has been duly qualified under the Trust Indenture Act of 1939, as amended, and, on the Closing Date, will be duly authorized, executed and delivered by the Issuers and will be a valid and binding agreement of the Issuers, enforceable against the Issuers in accordance with its terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights generally and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.

(m) The Notes have been duly authorized and, when executed and authenticated in accordance with the provisions of the Indenture and delivered to each Underwriter

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against payment therefor as provided by this Agreement, will be entitled to the benefits of the Indenture, and will be valid and binding obligations of the Company, enforceable against the Company in accordance with their terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights generally and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.

(n) The Guarantees have been duly authorized and, upon endorsement on the Notes by the Guarantors, execution and authentication of the Notes in accordance with the provisions of the Indenture and delivery of the Notes to each Underwriter against payment therefor as provided by this Agreement, will be entitled to the benefits of the Indenture, and will be valid and binding obligations of the Guarantors, enforceable against the Guarantors in accordance with their terms except as (i) the enforceability thereof may be limited by bankruptcy, insolvency or similar laws affecting creditors’ rights generally and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.

(o) The Securities and the Indenture conform in all material respects to the description thereof in the Time of Sale Information and the Prospectus.

(p) Neither the Company nor any of its subsidiaries has sustained, since the date of the latest audited financial statements in the Time of Sale Information and the Prospectus, any loss or interference with the business of the Company and its subsidiaries taken as a whole from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Time of Sale Information and the Prospectus, resulting in a Material Adverse Effect; and, since such date, there has not been any change in the capital stock (other than (i) the issuance of shares of Common Stock upon exercise of options, rights and awards described as outstanding in, (ii) the grant of options, rights and awards under existing equity incentive plans described in, and (iii) the issuance of shares of Common Stock under our employee stock purchase plan described in the Time of Sale Information and the Prospectus) or material change in the long term debt of the Company or any of its subsidiaries or any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders’ equity or results of operations of the Company and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Time of Sale Information and the Prospectus.

(q) There are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by the Company under the Act.

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(r) The Company and its subsidiaries own the items of real property and personal property purported to be owned by them which are material to the conduct of the business of the Company and its subsidiaries taken as a whole, free and clear of all liens, encumbrances and defects, except such as are described in the Time of Sale Information and the Prospectus or such as would not have a Material Adverse Effect. All real property held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases, with such exceptions as are described in the Time of Sale Information and the Prospectus or such as would not have a Material Adverse Effect.

(s) Except as described in the Time of Sale Information and the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property or assets of the Company or any of its subsidiaries is the subject which are reasonably likely to have a Material Adverse Effect; and to the Issuers’ knowledge, no such proceedings are threatened by governmental authorities or by others.

(t) The conditions for use of Form S-3, as set forth in the General Instructions thereto, have been satisfied. The Company is not an “ineligible issuer” as defined under Rule 405 of the Act.

(u) To the Issuers’ knowledge, all real property owned (either presently or at any time in the past) or presently leased by the Company and its subsidiaries in connection with the operation of their business, including, without limitation, any subsurface soils and ground water (collectively, the “ Realty ”), is free of contamination from any substance or material presently known to be toxic or hazardous, including, without limitation, any radioactive substance, methane, volatile hydrocarbons or industrial solvents (each, a “ Hazardous Substance ”), which could reasonably be expected to materially impair the beneficial use thereof by the Company and its subsidiaries or constitute or cause a significant health, safety or other environmental hazard to occupants or users (except for contaminations which would not have a Material Adverse Effect); and to the Issuers’ knowledge, the Realty does not contain any underground storage or treatment tanks, active or abandoned water, gas or oil wells, or any other underground improvements or structures, other than the foundations, footings or other supports for the improvements located thereon, the presence of which would have a Material Adverse Effect. Notwithstanding the foregoing, Hazardous Substances shall be deemed not to include any supplies or substances maintained, used, stored or held on the Realty which are (i) naturally occurring, (ii) installed by public utilities or (iii) used in the ordinary course of the Company’s or its subsidiaries’ business, provided that such supplies or substances are stored, used, maintained and held in all material respects in accordance with any applicable governmental requirements and with restrictions, conditions and standards suggested by the manufacturer and the Company’s insurance carriers.

(v) The Company and its subsidiaries carry, or are covered by, insurance in such amounts and covering such risks as is adequate for the conduct of their respective businesses.

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(w) The Company and its subsidiaries own or possess adequate rights to use all material patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights and licenses necessary for the conduct of their respective businesses the absence of which would have a Material Adverse Effect, and have no reason to believe that the conduct of their respective businesses will conflict with, and have not received any notice of any claim of conflict with, any such rights of others which could reasonably be expected to have a Material Adverse Effect.

(x) There are no contracts or other documents which are required to be described in the Time of Sale Information and the Prospectus or filed as exhibits to the Registration Statement by the Act which have not been described in the Time of Sale Information and the Prospectus or filed as exhibits to the Registration Statement or incorporated therein by reference as permitted by the Act.

(y) No labor disturbance by the employees of the Company or any of its subsidiaries exists or, to the Issuers’ knowledge, is imminent which could reasonably be expected to have a Material Adverse Effect.

(z) The Company and its subsidiaries have filed all federal, state and local income and franchise tax returns required to be filed through the date hereof and have paid all taxes due thereon, except where the failure to do so has not had and would not reasonably be expected to have a Material Adverse Effect, and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does any Issuer have any knowledge of any tax deficiency which would reasonably be likely to have) a Material Adverse Effect.

(aa) Since the date as of which information is given in the Time of Sale Information and the Prospectus, and except as may otherwise be disclosed or contemplated in the Time of Sale Information and the Prospectus, neither the Company nor any of its subsidiaries has (i) entered into any material transaction not in the ordinary course of business or (ii) declared or paid any dividend on its capital stock (other than payment of dividends whose declaration was so disclosed), and, from the date of the Prospectus, neither the Company nor any of its subsidiaries has incurred any liability other than in the ordinary course of business that is material to the Company and its subsidiaries taken as a whole.

(bb) The Company is in compliance with Section 13(b)(2) of the Exchange Act and Rule 13a-15 under the Exchange Act. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement and the Prospectus fairly present the information called for in all material respects and have been prepared in accordance with the Commission’s rules and guidelines applicable thereto.

(cc) The Company is not in violation of, and none of its subsidiaries is in a material violation of, their respective organizational documents. Neither the Company nor any of its subsidiaries (i) is in default and no event has occurred which, with notice or

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lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other material agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject as a result of which default there would be a Material Adverse Effect or (ii) is in violation of any law, ordinance, governmental rule, regulation or court decree to which it or its property or assets may be subject or has failed to obtain any license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of its property or to the conduct of its business which violation or failure would have a Material Adverse Effect.

(dd) Neither the Company nor any of its subsidiaries is or, after giving effect to the offering and sale of the Securities, will be an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder.

(ee) Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other payment, in each case under this clause (iv), to the extent unlawful.

(ff) The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Money Laundering Laws ”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

(gg) None of the Company, any of its subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“ OFAC ”); and the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

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(hh) The Company has not taken, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.

7. Indemnification .

(a) The Issuers, jointly and severally, agree to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, and the directors, officers, employees, affiliates and agents of each of the foregoing (collectively, the “ Underwriter Indemnified Parties ”), from and against any and all losses, claims, damages, liabilities and judgments caused by (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading or (ii) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information, or caused by any omission or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages, judgments or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representative expressly for use therein. The foregoing indemnity agreement shall be in addition to any liability that the Issuers may otherwise have.

(b) In case any action shall be brought against any Underwriter Indemnified Party, based upon the Preliminary Prospectus, the Registration Statement, any Issuer Free Writing Prospectus, any Time of Sale Information or the Prospectus or any amendment or supplement thereto and with respect to which indemnity may be sought against the Issuers, the Underwriters shall promptly notify the Issuers in writing and the Issuers shall assume the defense thereof, including the employment of counsel reasonably satisfactory to such indemnified party and payment of all fees and expenses. Such Underwriter Indemnified Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Underwriter Indemnified Party unless (i) the employment of such counsel shall have been specifically authorized in writing by the Issuers, (ii) the Issuers shall have failed to assume the defense and employ counsel or (iii) the named parties to any such action (including any impleaded parties) include both such Underwriter Indemnified Party and the Issuers and such Underwriter Indemnified Party shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the Issuers (in which case the Issuers shall not have the right to assume the defense of such action on behalf of such Underwriter Indemnified Party, it being understood, however, that the Issuers shall not, in connection with any one such action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all such Underwriter Indemnified Parties, which firm shall be designated in writing by the Representative and that all such

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fees and expenses shall be reimbursed as they are incurred). The Issuers shall not be liable for any settlement of any such action effected without the Company’s written consent but if settled with the written consent of the Company, the Issuers agree to indemnify and hold harmless the Underwriter Indemnified Parties from and against any loss or liability by reason of such settlement. The Company shall not, without the prior written consent of the Underwriter Indemnified Parties, effect any settlement of any pending or threatened proceeding in respect of which the Underwriter Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Underwriter Indemnified Party, unless such settlement includes an unconditional release of such Underwriter Indemnified Party from all liability on claims that are the subject matter of such proceeding and does not contain any admission of guilt in respect of any Underwriter Indemnified Party.

(c) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Issuers, their directors, their officers who sign the Registration Statement and any person controlling the Issuers within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as the foregoing indemnity from the Issuers to the Underwriter Indemnified Parties but only with reference to information relating to an Underwriter furnished in writing by or on behalf of such Underwriter expressly for use in the Registration Statement, the Prospectus, the Preliminary Prospectus, any Issuer Free Writing Prospectus or any Time of Sale Information. In case any action shall be brought against the Issuers, any of their directors, any such officer or any person controlling the Issuers based on the Registration Statement, the Prospectus, the Preliminary Prospectus, any Issuer Free Writing Prospectus or any Time of Sale Information and in respect of which indemnity may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Issuers (except that if the Issuers shall have assumed the defense thereof, such Underwriter shall not be required to do so, but may employ separate counsel therein and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Underwriter), and the Issuers, their directors, any such officers and any person controlling the Issuers shall have the rights and duties given to the Underwriters by Section 7(b) hereof.

(d) If the indemnification provided for in this Section 7 is unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or judgments referred to therein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities and judgments (i) in such proportion as is appropriate to reflect the relative benefits received by the Issuers on the one hand and the Underwriters on the other hand from the offering of the Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Issuers and the Underwriters in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or judgments, as well as any other relevant equitable considerations. The relative benefits received by the Issuers and the Underwriters shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company, and the compensation received by the Underwriters (based on discount to investors on resale), bear to the sum of such total net proceeds and such compensation. The relative fault of the Issuers and the Underwriters shall be determined by reference to,

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among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Issuers or the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

The Issuers and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or judgments referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section 7 are several in proportion to their respective purchase obligations hereunder and not joint.

The Underwriters confirm and the Issuers acknowledge that the statements with respect to the public offering of the Securities by the Underwriters set forth in the third and eighth (with caption “Short positions”) paragraphs of the section entitled “Underwriting” in the Preliminary Prospectus Supplement and the Prospectus Supplement constitute the only information concerning such Underwriter furnished in writing to the Issuers by or on behalf of such Underwriter specifically for inclusion in the Registration Statement, the Prospectus, Preliminary Prospectus, Issuer Free Writing Prospectus and the Time of Sale Information for all purposes under this Agreement.

8. Conditions of Underwriters’ Obligation . The obligation of the Underwriters to purchase the Securities under this Agreement is subject to the satisfaction of each of the following conditions:

(a) All the representations and warranties of the Issuers contained in this Agreement shall be true and correct as of the Time of Sale and on the Closing Date with the same force and effect as if made on and as of the Time of Sale and on and as of the Closing Date. The Issuers shall have performed or complied with all of their agreements herein contained and required to be performed or complied with by them at or prior to the Closing Date.

(b) (i) No stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose or pursuant to Section 8A of the Act against the Company in connection with the offering of the Securities shall have been commenced or shall be pending before or threatened by the Commission,

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(ii) every request for additional information on the part of the Commission shall have been complied with in all material respects and (iii) no stop order suspending the sale of the Securities in any jurisdiction referred to in Section 6(h) shall have been issued and no proceeding for that purpose shall have been commenced or shall be pending or threatened which would, in your reasonable judgment, make it impracticable or inadvisable to market the Securities or to enforce contracts for the sale of the Securities.

(c) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date, there shall not have been any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any Issuer’s debt by any “nationally recognized statistical rating organization,” as such term is defined in Section (3)(a)(62) of the Exchange Act.

(d) (i) Since the date of the latest balance sheet included in the Registration Statement, the Time of Sale Information and the Prospectus there shall not have been any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, affairs or business prospects, whether or not arising in the ordinary course of business, of the Company and its subsidiaries taken as a whole, (ii) since the date of the latest balance sheet included in the Registration Statement, the Time of Sale Information and the Prospectus there shall not have been any material change in the capital stock or in the long-term debt of the Company or any of its subsidiaries from that set forth or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus and (iii) the Company and its subsidiaries shall have no liability or obligation, direct or contingent, which is material to the Company and its subsidiaries, taken as a whole, other than those set forth or contemplated in the Registration Statement, the Time of Sale Information and the Prospectus.

(e) You shall have received on the Closing Date a certificate, dated the Closing Date, signed by (i) Donald R. Horton or Donald J. Tomnitz and (ii) Bill W. Wheat or Stacey H. Dwyer in their capacities as (A) the Chairman of the Board or Chief Executive Officer and President and (B) Chief Financial Officer or Treasurer of the Company, respectively, confirming the matters set forth in paragraphs (a), (b), (c) and (d) of this Section 8.

(f) You shall have received on the Closing Date letters (satisfactory to you and counsel for the Underwriters), dated the Closing Date, of Gibson, Dunn & Crutcher LLP, special counsel for the Company, in the form previously agreed between such special counsel and counsel for the Underwriters.

(g) You shall have received on the Closing Date letters, dated the Closing Date, of Cahill Gordon & Reindel LLP , counsel for the Underwriters, in form and substance satisfactory to the Underwriters.

(h) You shall have received letters on and as of the date of this Agreement and the Closing Date, in form and substance satisfactory to you, from PricewaterhouseCoopers LLP, an independent registered public accounting firm, with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Information (including the Preliminary Prospectus) and the Prospectus.

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(i) (i) Neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements in the Time of Sale Information and the Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Time of Sale Information and the Prospectus or (ii) since such date there shall not have been any change in the capital stock, net revenues, per share or total amounts of income before extraordinary items or of net income or long-term debt of the Company or any of its subsidiaries or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders’ equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Time of Sale Information and the Prospectus, the effect of which, in any such case described in clause (i) or (ii), is, in the judgment of the Representative, so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Securities being delivered on the Closing Date on the terms and in the manner contemplated in the Time of Sale Information and the Prospectus.

(j) The Issuers shall have furnished to you such other documents and certificates as to the accuracy and completeness of any statement in the Registration Statement, any Issuer Free Writing Prospectus, any Time of Sale Information and the Prospectus as you reasonably may request.

(k) You shall have been furnished with such additional documents and certificates as you or counsel for the Underwriters may reasonably request.

All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof only if they are reasonably satisfactory in form and substance to you and your counsel.

Any certificate or document signed by any officer of the Issuers and delivered to you or to your counsel shall be deemed a representation and warranty by the Issuers to the Underwriters as to the statements made therein.

9. Default by an Underwriter . If any one Underwriter shall fail to purchase and pay for any of the Notes agreed to be purchased by such Underwriter hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the principal amount of Notes set forth opposite their names in Schedule A hereto bears to the aggregate principal amount of Notes set forth opposite the names of all the remaining Underwriters) the Notes which the defaulting Underwriter or Underwriters agreed but failed to purchase; provided , however , that in the event that the aggregate principal amount of Notes which the defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate principal amount of Notes set forth in Schedule A hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any

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obligation to purchase any, of the Notes, and if such non-defaulting Underwriters do not purchase all of the Notes, this Agreement will terminate without liability to any non-defaulting Underwriter or the Company except that the provisions of Sections 5(l) and 7 shall at all times be effective and shall survive such termination. In the event of a default by any Underwriter as set forth in this Section 9, the Closing Date shall be postponed for such period, not exceeding five business days, as the Representative shall determine in order that the required changes in the Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Company or any non-defaulting Underwriter for damages occasioned by its default hereunder.

10. Representations and Warranties by and Agreements of the Underwriters . Each Underwriter hereby severally represents and warrants to and agrees with the Issuers that:

(a) it has not and will not use, authorize use of, refer to, or participate in the planning for use of, any “free writing prospectus,” as defined in Rule 405 under the Act (which term includes use of any written information furnished to the Commission by the Company and not incorporated by reference into the Registration Statement and any press release issued by the Company) other than (i) a free writing prospectus that, solely as a result of use by such underwriter, would not trigger an obligation to file such free writing prospectus with the Commission pursuant to Rule 433 (other than a free writing prospectus under clause (b) below), (ii) any Issuer Free Writing Prospectus listed on Exhibit A or prepared pursuant to Section 5(d) or Section 6(c) above or (iii) any free writing prospectus prepared by such Underwriter and approved by the Company in advance in writing (the approval thereof not being intended in itself to make such free writing prospectus an Issuer Free Writing Prospectus). Notwithstanding the foregoing, the Underwriters may use a term sheet substantially in the form of Exhibit B hereto without the consent of the Company;

(b) it will, pursuant to reasonable procedures developed in good faith, retain copies of each free writing prospectus used or referred to by it, in accordance with Rule 433 under the Act; and

(c) it is not subject to any pending proceeding under Section 8A of the Act with respect to the offering (and will promptly notify the Company if any such proceeding against it is initiated during the period referred to in Section 5(e) above).

11. Termination . This Agreement may be terminated at any time prior to the Closing Date by the Representative by written notice to the Issuers if any of the following has occurred: (i) since the respective dates as of which information is given in the Registration Statement, the Time of Sale Information and the Prospectus, any material adverse change or development involving a prospective material adverse change in the condition, financial or otherwise, of the Company and its subsidiaries or the earnings, affairs, or business prospects of the Company and its subsidiaries taken as a whole, whether or not arising in the ordinary course of business, (ii) any outbreak or escalation of hostilities or other national or international calamity or crisis or change in economic conditions or in the financial markets of the United States or elsewhere that, in your judgment, is material and adverse, (iii) the suspension or limitation of

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trading in securities of any Issuer by the Commission or on the New York Stock Exchange, or the suspension or material limitation of trading in securities on the New York Stock Exchange or the Nasdaq Stock Market, Inc. or limitation on prices for securities on any such exchange, (iv) the enactment, publication, decree or other promulgation of any federal or state statute, regulation, rule or order of any court or other governmental authority which in your opinion materially and adversely affects, or will materially and adversely affect, the business or operations of the Company and its subsidiaries taken as a whole, (v) the declaration of a banking moratorium by either federal or New York State authorities, or (vi) the taking of any action by any federal, state or local government or agency in respect of its monetary or fiscal affairs which in your opinion has a material adverse effect on the financial markets in the United States and, in the case of clause (i), (ii), (iv) or (vi), that would, in the judgment of the Representative, make it impracticable to market the Securities on the terms and in the manner contemplated in the Time of Sale Information and the Prospectus.

12. No Fiduciary Duty . The Issuers acknowledge and agree that the Underwriters are acting solely in the capacity of an arm’s length contractual counterparty to the Issuers with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, any Issuer or any other person. Additionally, neither the Representative nor any other Underwriter is advising any Issuer or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. Each Issuer shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Underwriters shall have no responsibility or liability to any Issuer with respect thereto. Any review by the Underwriters of any Issuer, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Underwriters and shall not be on behalf of any Issuer.

13. Miscellaneous . Notices given pursuant to any provision of this Agreement shall be addressed as follows: (a) if to the Issuers, to D.R. Horton, Inc., 301 Commerce Street, Suite 500, Fort Worth, Texas 76102, Attention: Chief Financial Officer, and (b) if to the Underwriters, c/o Citigroup Global Markets Inc., 388 Greenwich Street, New York, NY 10013 (fax number: (212) 816-7912), Attention: General Counsel, with a copy to Cahill Gordon & Reindel LLP , 80 Pine Street, New York, New York 10005-1702 (fax number: (212) 269-5420), Attention: Daniel Zubkoff, or in any case to such other address as the person to be notified may have requested in writing.

The respective indemnities, contribution agreements, representations, warranties and other statements of the Company, its officers and directors (in their capacities as such) and of the Underwriters set forth in or made pursuant to this Agreement shall remain operative and in full force and effect, and will survive delivery of and payment for the Securities, regardless of (i) any investigation, or statement as to the results thereof, made by or on behalf of an Underwriter or by or on behalf of the Company, the officers or directors of the Company or any controlling person of the Company (in their capacities as such), (ii) acceptance of the Securities and payment for them hereunder and (iii) termination of this Agreement.

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If this Agreement shall be terminated by the Underwriters because of any failure or refusal on the part of any Issuer to perform any of its agreements in this Agreement or to fulfill any of the conditions of Section 8 of this Agreement the Issuers, jointly and severally, agree to reimburse the Underwriters for all out-of-pocket expenses (including the fees and disbursements of counsel) reasonably incurred by them.

Except as otherwise provided, this Agreement has been and is made solely for the benefit of and shall be binding upon the Issuers, the Underwriters, any controlling persons referred to herein, the other indemnitees referred to herein and their respective successors and assigns, all as and to the extent provided in this Agreement, and no other person shall acquire or have any right under or by virtue of this Agreement. The term “successors and assigns” shall not include a purchaser of any of the Securities from any Underwriter merely because of such purchase.

This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed and construed in accordance with the laws of the State of New York.

This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication including by email in .pdf format), each of which shall be an original and all of which together shall constitute one and the same instrument.

References herein to “your judgment” or “your opinion” shall be deemed to be the judgment or opinion, as the case may be, of the Representative only.

[Signature Pages Follow]

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Please confirm that the foregoing correctly sets forth the agreement between the Issuers and the Underwriters.


Sincerely,

D.R. HORTON, INC.

By:		/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

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GUARANTORS:

C. RICHARD DOBSON BUILDERS, INC.

CH INVESTMENTS OF TEXAS, INC.

CHI CONSTRUCTION COMPANY

CHTEX OF TEXAS, INC.

CONTINENTAL HOMES, INC.

CONTINENTAL RESIDENTIAL, INC.

D.R. HORTON BAY, INC.

D.R. HORTON CRUCES CONSTRUCTION, INC.

D.R. HORTON, INC. – BIRMINGHAM

D.R. HORTON, INC. – CHICAGO

D.R. HORTON, INC. - DIETZ-CRANE

D.R. HORTON, INC. – FRESNO

D.R. HORTON, INC. – GREENSBORO

D.R. HORTON, INC. – GULF COAST

D.R. HORTON, INC. – HUNTSVILLE

D.R. HORTON, INC. - JACKSONVILLE

D.R. HORTON, INC. – LOUISVILLE

D.R. HORTON, INC. – MINNESOTA

D.R. HORTON, INC. - NEW JERSEY

D.R. HORTON, INC. – PORTLAND

D.R. HORTON, INC. - SACRAMENTO

D.R. HORTON, INC. – TORREY

D.R. HORTON LA NORTH, INC.

D.R. HORTON LOS ANGELES HOLDING COMPANY, INC.

D.R. HORTON MATERIALS, INC.

D.R. HORTON VEN, INC.

DRH CAMBRIDGE HOMES, INC.

DRH CONSTRUCTION, INC.

DRH REGREM XIV, INC.

DRH REGREM XV, INC.

DRH REGREM XVI, INC.

DRH REGREM XVII, INC.

DRH REGREM XVIII, INC.

DRH REGREM XIX, INC.

DRH REGREM XX, INC.

DRH REGREM XXI, INC.

DRH REGREM XXII, INC.

DRH REGREM XXIII, INC.

DRH REGREM XXIV, INC.

DRH REGREM XXV, INC.

DRH SOUTHWEST CONSTRUCTION, INC.

DRH TUCSON CONSTRUCTION, INC.

KDB HOMES, INC.

MEADOWS I, LTD.

MEADOWS II, LTD.

MEADOWS VIII, LTD.

MEADOWS IX, INC.

MEADOWS X, INC.

MELMORT CO.

MELODY HOMES, INC.

SCHULER HOMES OF CALIFORNIA, INC.

SCHULER HOMES OF OREGON, INC.

SCHULER HOMES OF WASHINGTON, INC.

SCHULER MORTGAGE, INC.

SCHULER REALTY HAWAII, INC.

SHLR OF CALIFORNIA, INC.

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SHLR OF COLORADO, INC.

SHLR OF NEVADA, INC.


SHLR OF UTAH, INC.
SHLR OF WASHINGTON, INC.
VERTICAL CONSTRUCTION CORPORATION
WESTERN PACIFIC FUNDING, INC.
WESTERN PACIFIC HOUSING, INC.
WESTERN PACIFIC HOUSING MANAGEMENT, INC.

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

-2-


CONTINENTAL HOMES OF TEXAS, L.P.

By:	CHTEX of Texas, Inc., its General Partner

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

D.R. HORTON MANAGEMENT COMPANY, LTD.
D.R. HORTON - EMERALD, LTD.
D.R. HORTON - TEXAS, LTD.
DRH REGREM VII, LP
DRH REGREM XII, LP

By:	Meadows I, Ltd., its General Partner

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

SGS COMMUNITIES AT GRANDE QUAY, L.L.C.

By:	Meadows IX, Inc., a Member

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

and

By:	Meadows X, Inc., a Member

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

DRH CAMBRIDGE HOMES, LLC
DRH REGREM VIII, LLC

By:	D.R. Horton, Inc. - Chicago, its Member

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

-3-


HPH HOMEBUILDERS 2000 L.P.
WESTERN PACIFIC HOUSING, L.P.
WESTERN PACIFIC HOUSING-ANTIGUA, LLC
WESTERN PACIFIC HOUSING-AVIARA, L.P.
WESTERN PACIFIC HOUSING-BOARDWALK, LLC
WESTERN PACIFIC HOUSING-BROADWAY, LLC
WESTERN PACIFIC HOUSING-CANYON PARK, LLC
WESTERN PACIFIC HOUSING-CARMEL, LLC
WESTERN PACIFIC HOUSING-CARRILLO, LLC
WESTERN PACIFIC HOUSING-COMMUNICATIONS HILL, LLC
WESTERN PACIFIC HOUSING-COPPER CANYON, LLC
WESTERN PACIFIC HOUSING-CREEKSIDE, LLC
WESTERN PACIFIC HOUSING-CULVER CITY, L.P.
WESTERN PACIFIC HOUSING-DEL VALLE, LLC
WESTERN PACIFIC HOUSING-LOMAS VERDES, LLC
WESTERN PACIFIC HOUSING-LOST HILLS PARK, LLC
WESTERN PACIFIC HOUSING-MCGONIGLE CANYON, LLC
WESTERN PACIFIC HOUSING-MOUNTAINGATE, L.P.
WESTERN PACIFIC HOUSING-NORCO ESTATES, LLC
WESTERN PACIFIC HOUSING-OSO, L.P.
WESTERN PACIFIC HOUSING-PACIFIC PARK II, LLC
WESTERN PACIFIC HOUSING-PARK AVENUE EAST, LLC
WESTERN PACIFIC HOUSING-PARK AVENUE WEST, LLC
WESTERN PACIFIC HOUSING-PLAYA VISTA, LLC
WESTERN PACIFIC HOUSING-POINSETTIA, L.P.
WESTERN PACIFIC HOUSING-RIVER RIDGE, LLC
WESTERN PACIFIC HOUSING-ROBINHOOD RIDGE, LLC
WESTERN PACIFIC HOUSING-SANTA FE, LLC
WESTERN PACIFIC HOUSING-SCRIPPS, L.P.
WESTERN PACIFIC HOUSING-SCRIPPS II, LLC
WESTERN PACIFIC HOUSING-SEACOVE, L.P.
WESTERN PACIFIC HOUSING-STUDIO 528, LLC
WESTERN PACIFIC HOUSING-TERRA BAY DUETS, LLC
WESTERN PACIFIC HOUSING-TORRANCE, LLC
WESTERN PACIFIC HOUSING-TORREY COMMERCIAL, LLC
WESTERN PACIFIC HOUSING-TORREY MEADOWS, LLC
WESTERN PACIFIC HOUSING-TORREY MULTI-FAMILY, LLC
WESTERN PACIFIC HOUSING-TORREY VILLAGE CENTER, LLC
WESTERN PACIFIC HOUSING-VINEYARD TERRACE, LLC
WESTERN PACIFIC HOUSING-WINDEMERE, LLC
WESTERN PACIFIC HOUSING-WINDFLOWER, L.P.
WPH-CAMINO RUIZ, LLC


By:	Western Pacific Housing Management, Inc., its Manager, Member or General Partner

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

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SCHULER HOMES OF ARIZONA LLC
SHA CONSTRUCTION LLC

By:	SRHI LLC, its Member

	By:	SHLR of Nevada, Inc. its Member

		By:	/s/ Bill W. Wheat
			Bill W. Wheat
			Executive Vice President and Chief Financial Officer

D.R. HORTON-SCHULER HOMES, LLC

By:	Vertical Construction Corporation, its Manager

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

SRHI LLC

By:	SHLR of Nevada, Inc., its Member

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

SSHI LLC

By:	SHLR of Washington, Inc., its Member

	By:	/s/ Bill W. Wheat
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

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Agreed and accepted as of the date first written above:

CITIGROUP GLOBAL MARKETS INC.

By:		/s/ Brian D. Bednarksi
		Name: Brian D. Bednarksi
		Title: Managing Director

		For itself and the other several Underwriters named in Schedule A to the foregoing Agreement.

SCHEDULE A


Underwriter	Principal Amount of Notes
Citigroup Global Markets Inc.	$	157,500,000
J.P. Morgan Securities LLC	$	157,500,000
UBS Securities LLC	$	35,000,000

Total	$	350,000,000

EXHIBIT A

Time of Sale Information

Final pricing term sheet in form of Exhibit B

EXHIBIT B

See attached.

Filed pursuant to Rule 433

Issuer Free Writing Prospectus, dated April 25, 2012

Supplementing the Preliminary Prospectus Supplement, dated April 25, 2012

Registration No. 333-162123

D.R. Horton, Inc.

$350,000,000 4.750% Senior Notes due 2017

Pricing Supplement

The information in this Pricing Supplement supplements the Preliminary Prospectus Supplement and supersedes the information in the Preliminary Prospectus Supplement to the extent it is inconsistent with the information in the Preliminary Prospectus Supplement.


Issuer		D.R. Horton, Inc.

Aggregate Principal Amount		$350,000,000

Title of Security		4.750% Senior Notes due 2017 (the “Notes”)

Maturity Date		May 15, 2017

Coupon		4.750%

Public Offering Price		100.000% plus accrued interest, if any, from May 1, 2012

Spread to Benchmark Treasury		+389.7 basis points

Benchmark Treasury		1.000% due March 31, 2017

Benchmark Treasury Price and Yield		100-22 ³ / 4 ; 0.852%

Interest Payment Dates		May 15 and November 15 of each year, beginning on November 15, 2012

Record Dates		May 1 and November 1 of each year

Optional Redemption		Make-whole call at T+50 basis points

Underwriting Discount		0.750%

Trade Date		April 25, 2012

Settlement Date		May 1, 2012 (T+4) We expect that delivery of the notes will be made to investors on May 1, 2012, which will be the fourth business day following the date of this pricing supplement (such settlement being referred to as “T+4”). Under Rule 15c6-1 under the Exchange Act, trades in the secondary market are required to settle in three business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade notes prior to the delivery of the notes will be required, by virtue of the fact that the notes initially settle in T+4, to specify an alternate settlement arrangement at the time of any such trade to prevent a failed settlement. Purchasers of the notes who wish to trade the notes prior to their date of delivery hereunder should consult their advisors.


Expected Ratings		[ ]

CUSIP/ISIN Numbers		CUSIP: 23331A BD0 ISIN: US23331ABD00

Joint Book-Running Managers		Citigroup Global Markets Inc. J.P. Morgan Securities LLC UBS Securities LLC

Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.

The issuer has filed a registration statement (including a prospectus and a related prospectus supplement) with the United States Securities and Exchange Commission (“SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement, the prospectus supplement and other documents D.R. Horton, Inc. has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, copies of the prospectus supplement and accompanying prospectus may be obtained by calling Citigroup Global Markets Inc. toll-free at 1-877-858-5407.

ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.

Exhibit 4.1

D.R. HORTON, INC.

and

THE GUARANTORS FROM TIME TO TIME PARTY HERETO

Senior Debt Securities

Indenture

Dated as of May 1, 2012

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,

as Trustee

CROSS-REFERENCE TABLE

This Cross-Reference Table is not a part of the Indenture .


TIA Section		Indenture Section
310(a)(1)		7.10
(a)(2)		7.10
(a)(3)		N.A.
(a)(4)		N.A.
(b)		7.08; 7.10; 11.02

311(a)		7.11
(b)		7.11
(c)		N.A.

312(a)		2.05
(b)		11.03
(c)		11.03

313(a)		7.06
(b)(1)		N.A.
(b)(2)		7.06
(c)		11.02
(d)		7.06

314(a)		4.03; 11.02
(b)		N.A.
(c)(1)		11.04
(c)(2)		11.04
(c)(3)		N.A.
(d)		N.A.
(e)		11.05

315(a)		7.01(b)
(b)		7.05; 11.02
(c)		7.01(a)
(d)		7.01(c)
(e)		6.11

316(a)(last sentence)		11.06
(a)(1)(A)		6.05
(a)(1)(B)		6.04
(a)(2)		N.A.
(b)		6.07

317(a)(1)		6.08
(a)(2)		6.09
(b)		2.04
318(a)		11.01

N.A. means Not Applicable.

TABLE OF CONTENTS

This Table of Contents is not a part of the Indenture .


		Page
ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.01.	Definitions		1
Section 1.02.	Other Definitions		5
Section 1.03.	Incorporation by Reference of Trust Indenture Act		5
Section 1.04.	Rules of Construction		5
ARTICLE TWO THE SECURITIES
ARTICLE TWO THE SECURITIES
Section 2.01.	Form and Dating.		6
Section 2.02.	Execution and Authentication		7
Section 2.03.	Registrar and Paying Agent		8
Section 2.04.	Paying Agent to Hold Money in Trust		8
Section 2.05.	Securityholder Lists		8
Section 2.06.	Transfer and Exchange		8
Section 2.07.	Replacement Securities		9
Section 2.08.	Outstanding Securities		9
Section 2.09.	Temporary Securities		9
Section 2.10.	Cancellation		9
Section 2.11.	Defaulted Interest		10
Section 2.12.	Treasury Securities		10
Section 2.13.	CUSIP/ISIN Numbers		10
Section 2.14.	Deposit of Moneys		10
Section 2.15.	Book-Entry Provisions for Global Security		10
ARTICLE THREE REDEMPTION
ARTICLE THREE REDEMPTION
Section 3.01.	Notices to Trustee		12
Section 3.02.	Selection of Securities to be Redeemed		12
Section 3.03.	Notice of Redemption		12
Section 3.04.	Effect of Notice of Redemption		13
Section 3.05.	Deposit of Redemption Price		13
Section 3.06.	Securities Redeemed in Part		13
ARTICLE FOUR COVENANTS
ARTICLE FOUR COVENANTS
Section 4.01.	Payment of Securities		13
Section 4.02.	Maintenance of Office or Agency		13
Section 4.03.	Compliance Certificate		14
Section 4.04.	Payment of Taxes; Maintenance of Corporate Existence; Maintenance of Properties		14
Section 4.05.	Additional Guarantors		14
Section 4.06.	Waiver of Stay, Extension or Usury Laws.		15

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ARTICLE FIVE SUCCESSOR CORPORATION
ARTICLE FIVE SUCCESSOR CORPORATION
Section 5.01.	When Company May Merge, etc.	15
ARTICLE SIX DEFAULTS AND REMEDIES
ARTICLE SIX DEFAULTS AND REMEDIES
Section 6.01.	Events of Default.	16
Section 6.02.	Acceleration	17
Section 6.03.	Other Remedies	18
Section 6.04.	Waiver of Existing Defaults	18
Section 6.05.	Control by Majority	18
Section 6.06.	Limitation on Suits	18
Section 6.07.	Rights of Holders to Receive Payment	18
Section 6.08.	Collection Suit by Trustee	19
Section 6.09.	Trustee May File Proofs of Claim	19
Section 6.10.	Priorities	19
Section 6.11.	Undertaking for Costs	19
ARTICLE SEVEN TRUSTEE
ARTICLE SEVEN TRUSTEE
Section 7.01.	Duties of Trustee	20
Section 7.02.	Rights of Trustee	20
Section 7.03.	Individual Rights of Trustee	21
Section 7.04.	Trustee’s Disclaimer	21
Section 7.05.	Notice of Defaults.	21
Section 7.06.	Reports by Trustee to Holders	22
Section 7.07.	Compensation and Indemnity	22
Section 7.08.	Replacement of Trustee	22
Section 7.09.	Successor Trustee by Merger, etc	23
Section 7.10.	Eligibility; Disqualification	23
Section 7.11.	Preferential Collection of Claims Against Company	23
ARTICLE EIGHT DISCHARGE OF INDENTURE
ARTICLE EIGHT DISCHARGE OF INDENTURE
Section 8.01.	Defeasance upon Deposit of Moneys or U.S. Government Obligations	23
Section 8.02.	Survival of the Company’s Obligations	25
Section 8.03.	Application of Trust Money	26
Section 8.04.	Repayment to the Company	26
Section 8.05.	Reinstatement	26
ARTICLE NINE GUARANTEES
ARTICLE NINE GUARANTEES
Section 9.01.	Unconditional Guarantees	26

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Section 9.02.	Severability	27
Section 9.03.	Release of a Guarantor.	27
Section 9.04.	Limitation of a Guarantor’s Liability	28
Section 9.05.	Contribution	28
Section 9.06.	Waiver of Subrogation	28
Section 9.07.	Execution of Guarantee	28
ARTICLE TEN AMENDMENTS, SUPPLEMENTS AND WAIVERS
ARTICLE TEN AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 10.01.	Without Consent of Holders	29
Section 10.02.	With Consent of Holders	29
Section 10.03.	Compliance with Trust Indenture Act	30
Section 10.04.	Revocation and Effect of Consents	30
Section 10.05.	Notation on or Exchange of Securities	31
Section 10.06.	Trustee to Sign Amendments, etc.	31
Section 10.07.	Notice of Supplemental Indenture.	31
ARTICLE ELEVEN MISCELLANEOUS
ARTICLE ELEVEN MISCELLANEOUS
Section 11.01.	Trust Indenture Act Controls	31
Section 11.02.	Notices	31
Section 11.03.	Communications by Holders with Other Holders	32
Section 11.04.	Certificate and Opinion as to Conditions Precedent	32
Section 11.05.	Statements Required in Certificate or Opinion	33
Section 11.06.	Rules by Trustee and Agents	33
Section 11.07.	Legal Holidays	33
Section 11.08.	Governing Law	33
Section 11.09.	No Adverse Interpretation of Other Agreements	33
Section 11.10.	No Recourse Against Others	33
Section 11.11.	Successors and Assigns	33
Section 11.12.	Duplicate Originals	34
Section 11.13.	Severability	34

SIGNATURES

EXHIBIT A – Form of Security

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INDENTURE dated as of May 1, 2012 (the “ Base Indenture ”), by and among D.R. HORTON, INC., a Delaware corporation (the “ Company ”), each of the Guarantors from time to time party hereto in respect of a particular Series of Securities (each as defined in Section 1.01 below) and AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC, as trustee (the “ Trustee ”).

Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company’s debt securities issued under this Base Indenture:

ARTICLE ONE

DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.01. Definitions.

“ Affiliate ” means, when used with reference to a specified person, any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Person specified.

“ Agent ” means any Registrar, Paying Agent or co-Registrar or agent for service of notices and demands.

“ Authorizing Resolution ” means a resolution adopted by the Board of Directors or by an Officer or committee of Officers pursuant to Board delegation authorizing a Series of Securities.

“ Bankruptcy Law ” means Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors.

“ Board of Directors ” means the Board of Directors of the Company or any duly authorized committee thereof.

“ Capital Stock ” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of or in such Person’s capital stock or other equity interests.

“ Capitalized Lease Obligations ” of any Person means, at the time any determination thereof is to be made, the obligations of such Person to pay rent or other amounts under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP, and the amount of such obligations will be the capitalized amount thereof determined in accordance with GAAP.

“ Company ” means the party named as such in this Indenture until a successor replaces it pursuant to the Indenture and thereafter means the successor.

“ control ” means, when used with respect to any Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “ controlling ” and “ controlled ” have meanings correlative to the foregoing.

“ Credit Facilities ” means, collectively, each of the credit facilities and lines of credit of the Company or one or more Guarantors in existence on the date of this Base Indenture and one or more future facilities or lines of credit among or between the Company or one or more Guarantors and one or more lenders pursuant to which the Company or any Guarantor may incur indebtedness for working capital and general corporate purposes (including acquisitions), as any such facility or line of credit may be amended, restated, supplemented or otherwise modified from time to time, and includes any agreement extending the maturity of, increasing the amount of, or restructuring, all or any portion of the Indebtedness under such facility or line of credit or any successor facilities or lines of credit and includes any facility or line of credit with one or more lenders refinancing or replacing all or any portion of the Indebtedness under such facility or line of credit or any successor facility or line of credit, provided , in each case, that such credit facility shall provide for commitments, or there shall be loans or other extensions of credit outstanding thereunder, in each case in excess of $50 million.

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“ Currency Agreement ” of any Person means any foreign exchange contract, currency swap agreement or other similar agreement or arrangement designed to protect such Person or any of its Subsidiaries against fluctuations in currency values.

“ Default ” means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default.

“ Definitive Security ” means a certificated Security registered in the name of the Securityholder thereof.

“ Depositary ” means, with respect to Securities of any Series which the Company shall determine will be issued in whole or in part as a Global Security, DTC, another clearing agency, or any successor registered as a clearing agency under the Exchange Act, and any other applicable U.S. or foreign statute or regulation, which, in each case, shall be designated by the Company pursuant to Section 2.01 .

“ Dollars ” and “ $ ” mean United States Dollars.

“ DTC ” means The Depository Trust Company, New York, New York.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ GAAP ” means generally accepted accounting principles set forth in the accounting standards codification of the Financial Accounting Standards Board or in such other statements by such or any other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the date of this Base Indenture.

“ Global Security ” means, with respect to any Series of Securities, a Security executed by the Company and delivered by the Trustee to the Depositary or pursuant to the Depositary’s instruction, all in accordance with the Indenture, which shall be registered in the name of the Depositary or its nominee.

“ Guarantee ” means the guarantee of Securities of any applicable Series by each Guarantor thereof under this Indenture.

“ Guarantors ” means with respect to any Series (i) the Company’s Subsidiaries signatory to the supplemental indenture or specified in the Authorizing Resolution with respect to such Series as the initial Guarantors of such Series, and (ii) each of the Company’s Subsidiaries that becomes a Guarantor of such Series pursuant to the provisions of this Indenture, in each case until released from its Guarantee pursuant to the provisions of this Indenture.

“ Holder ” or “ Securityholder ” means the Person in whose name a Security is registered on the Registrar’s books.

“ Indebtedness ” of any Person means, without duplication, (i) any liability of such Person (a) for borrowed money or under any reimbursement obligation relating to a letter of credit or other similar instruments (other than any standby letter of credit or similar instrument issued for the account of, or any surety, performance, completion or payment bond, earnest money note or similar purpose undertaking or indemnification agreement issued or entered into by or for the account of, such Person in the ordinary course of business), (b) evidenced by a bond, note, debenture or similar instrument (including a purchase money obligation) given in connection with the acquisition of any businesses, properties or assets of any kind or with services incurred in connection with expenditures that constitute capital expenditures in accordance with GAAP (other than any obligation to pay a contingent purchase price as long as such obligation remains contingent), or (c) in respect of Capitalized Lease Obligations, (ii) any Indebtedness of others described in clause (i) above that such Person has guaranteed to the extent of the guarantee and (iii) all Indebtedness of others described in clause (i) above secured by a Lien on any Property of such Person,

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whether or not such Indebtedness is assumed by such Person; provided , that the amount of the Indebtedness of such Person shall be the lesser of (a) the fair market value of such Property; and (b) the amount of such Indebtedness of such other Persons; provided that Indebtedness shall not include accounts payable, liabilities to trade creditors of such Person or other accrued expenses arising in the ordinary course of business or obligations under Currency Agreements or Interest Protection Agreements.

“ Indenture ” means this Base Indenture as amended or supplemented from time to time, including pursuant to any Authorizing Resolution or supplemental indenture pertaining to any Series, and including, for all purposes of this instrument and any such Authorizing Resolution or supplemental indenture, the provisions of the TIA that are deemed to be a part of and govern this Base Indenture and any such Authorizing Resolution or supplemental indenture, respectively.

“ Interest Protection Agreement ” of any Person means any interest rate swap agreement, interest rate collar agreement, option or futures contract or other similar agreement or arrangement designed to protect such Person or any of its Subsidiaries against fluctuations in interest rates with respect to Indebtedness.

“ Issue Date ” means, with respect to any Series of Securities, the date on which the Securities of such Series are originally issued under this Indenture.

“ Lien ” means, with respect to any Property, any mortgage, deed of trust, lien, pledge, charge, hypothecation, security interest or encumbrance of any kind in respect of such Property. For purposes of this definition, a Person shall be deemed to own, subject to a Lien, any Property which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such Property.

“ Non-Recourse Indebtedness ” with respect to any Person means Indebtedness of such Person for which (i) the sole legal recourse for collection of principal and interest on such Indebtedness is against the specific Property identified in the instruments evidencing or securing such Indebtedness (and any accessions thereto and proceeds thereof) and such Property was acquired with the proceeds of such Indebtedness or such Indebtedness was incurred within 180 days after the acquisition of such Property and (ii) no other assets of such Person may be realized upon in collection of principal or interest on such Indebtedness. Indebtedness which is otherwise Non-Recourse Indebtedness will not lose its character as Non-Recourse Indebtedness because there is recourse to the borrower, any guarantor or any other Person for (a) environmental or tax warranties and indemnities and such other representations, warranties, covenants and indemnities as are customarily required in such transactions, or (b) indemnities for and liabilities arising from fraud, misrepresentation, misapplication or non-payment of rents, profits, insurance and condemnation proceeds and other sums actually received by the borrower from secured assets to be paid to the lender, waste and mechanics’ liens.

“ NYUCC ” means the New York Uniform Commercial Code, as in effect from time to time.

“ Officer ” means the Chairman of the Board, the President, any Vice President, the Treasurer, the Controller or the Secretary of the Company or a Guarantor, as applicable.

“ Officers’ Certificate ” means a certificate signed by two Officers or by an Officer and an Assistant Treasurer or an Assistant Secretary of the Company.

“ Opinion of Counsel ” means a written opinion from legal counsel. The counsel may be an employee of or counsel to the Company or the Trustee.

“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

“ principal ” of a debt security means the principal of the security plus , when appropriate, the premium, if any, on the security.

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“ Property ” of any Person means all types of real, personal, tangible, intangible or mixed property owned by such Person, whether or not included in the most recent consolidated balance sheet of such Person and its Subsidiaries under GAAP.

“ Publicly Traded Debt Securities ” means any issue of debt securities of the Company or any of the Guarantors originally issued in a public offering registered with the SEC or in an offering pursuant to Rule 144A under the Securities Act and of which issue at least $50 million aggregate principal amount is outstanding.

“ SEC ” means the Securities and Exchange Commission or any successor agency performing the duties now assigned to it under the TIA.

“ Securities ” means any Securities that are issued under this Base Indenture.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Series ” means a series of Securities established under this Base Indenture.

“ Significant Subsidiary ” means any Subsidiary of the Company which would constitute a “significant subsidiary” as defined in Rule 1-02 of Regulation S-X under the Securities Act and the Exchange Act.

“ Subsidiary ” of any Person means any corporation or other entity of which a majority of the Capital Stock having ordinary voting power to elect a majority of the board of directors of such entity or other persons performing similar functions is at the time directly or indirectly owned or controlled by such Person.

“ TIA ” means the Trust Indenture Act of 1939, as in effect from time to time, except as otherwise provided herein.

“ Trustee ” means the party named as such in this Base Indenture until a successor replaces it pursuant to this Base Indenture and thereafter means the successor serving hereunder; provided , however , that if at any time there is more than one such Person, “Trustee” as used with respect to the Securities of any Series shall mean only the Trustee with respect to Securities of that Series.

“ Trust Officer ” means the Chairman of the Board, the President, any Vice President or any other officer or assistant officer of the Trustee assigned by the Trustee to administer its corporate trust matters.

“ United States ” means the United States of America.

“ U.S. Government Obligations ” means securities which are (i) direct obligations of the United States for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States, which, in either case are not callable or redeemable at the option of the issuer thereof, and shall also include a depositary receipt issued by a bank or trust company as custodian with respect to any such U.S. government obligations or a specific payment of interest on or principal of any such U.S. government obligation held by such custodian for the account of the holder of a depositary receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the U.S. government obligation or the specific payment of interest on or principal of the U.S. government obligation evidenced by such depositary receipt.

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Section 1.02. Other Definitions.


Term			Defined in Section

Agent Members			2.15
Base Indenture			Preamble
Business Day			11.07
Covenant Defeasance			8.01
Custodian			6.01
Event of Default			6.01
Funding Guarantor			9.05
Guarantee			9.01
Legal Defeasance			8.01
Legal Holiday			11.07
Paying Agent			2.03
Registrar			2.03
Security Register			2.03
Senior Officer			4.03
Successor			5.01

Section 1.03. Incorporation by Reference of Trust Indenture Act.

Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings:

“Commission” means the SEC.

“indenture securities” means the Securities of a particular Series.

“indenture security holder” means a Securityholder.

“indenture to be qualified” means this Indenture.

“indenture trustee” or “institutional trustee” means the Trustee.

“obligor” on the indenture securities means the Company, each of the Guarantors, or any other obligor on the Securities of a Series or any Guarantees thereof.

All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule have the meanings so assigned to them.

Section 1.04. Rules of Construction .

Unless the context otherwise requires:

(1)

a term has the meaning assigned to it herein;

(2)

an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP and all accounting determinations shall be made in accordance with GAAP;

(3)

“or” is not exclusive and “including” means “including without limitation”;

(4)

words in the singular include the plural, and in the plural include the singular;

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(5)

“herein,” “hereof” and “hereunder,” and other words of similar import, refer to this Indenture as a whole (including any Authorizing Resolution or supplemental indenture relating to the relevant Series) and not to any particular Article, Section or other subdivision;

(6)

all exhibits are incorporated by reference herein and expressly made a part of this Indenture; and

(7)

any transaction or event shall be considered “permitted by” or made “in accordance with” or “in compliance with” this Indenture or any particular provision thereof if such transaction or event is not expressly prohibited by this Indenture or such provision, as the case may be.

ARTICLE TWO

THE SECURITIES

Section 2.01. Form and Dating .

The aggregate principal amount of Securities that may be issued under this Base Indenture is unlimited. The Securities may be issued from time to time in one or more Series. Each Series shall be created by an Authorizing Resolution or a supplemental indenture that establishes the terms of the Series, which may include the following:

(1)

the title of the Series;

(2)

the aggregate principal amount (or any limit on the aggregate principal amount) of the Series and, if any Securities of a Series are to be issued at a discount from their face amount, the method of computing the accretion of such discount;

(3)

the interest rate or method of calculation of the interest rate;

(4)

the date from which interest will accrue;

(5)

the record dates for interest payable on Securities of the Series;

(6)

the dates when, places where and manner in which principal and interest are payable;

(7)

the Registrar and Paying Agent;

(8)

the terms of any mandatory (including any sinking fund requirements) or optional redemption by the Company;

(9)

the terms of any redemption at the option of Holders;

(10)

the permissible denominations in which Securities of such Series are issuable, if different from $2,000 and multiples of $1,000 in excess thereof;

(11)

whether Securities of such Series will be issued in registered or bearer form and the terms of any such forms of Securities;

(12)

whether the Securities of the Series shall be issued in whole or in part in the form of a Global Security or Securities, the terms and conditions, if different from those contained in this Base Indenture, upon which such Global Security or Securities may be exchanged in whole or in part for Definitive Securities; the Depositary for such Global Security or Securities; the form of any legend or legends, if any, to be borne by any such Global Security or Securities in addition to or in lieu of the legends referred to in Section 2.15 ;

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(13)

the currency or currencies (including any composite currency) in which principal or interest or both may be paid;

(14)

if payments of principal or interest may be made in a currency other than that in which Securities of such Series are denominated, the manner for determining such payments;

(15)

provisions for electronic issuance of Securities or issuance of Securities of such Series in uncertificated form;

(16)

any Events of Default, covenants and/or defined terms in addition to or in lieu of those set forth in this Base Indenture;

(17)

whether and upon what terms Securities of such Series may be defeased or discharged if different from the provisions set forth in this Base Indenture;

(18)

the form of the Securities of such Series, which, unless the Authorizing Resolution or supplemental indenture otherwise provides, shall be in the form of Exhibit A ;

(19)

any terms that may be required by or advisable under applicable law;

(20)

the percentage of the principal amount of the Securities of such Series which is payable if the maturity of the Securities of such Series is accelerated in the case of Securities issued at a discount from their face amount;

(21)

whether Securities of such Series will or will not have the benefit of Guarantees and the Company’s Subsidiaries that will be the initial Guarantors of such Series;

(22)

whether the Securities of the Series will be convertible into or exchangeable for other Securities, common shares or other securities of any kind of the Company or another obligor, and, if so, the terms and conditions upon which such Securities will be so convertible or exchangeable, including the initial conversion or exchange price or rate or the method of calculation, how and when the conversion price or exchange ratio may be adjusted, whether conversion or exchange is mandatory, at the option of the holder or at the Company’s option, the conversion or exchange period, and any other provision in relation thereto; and

(23)

any other terms in addition to or different from those contained in this Base Indenture applicable to such Series.

All Securities of one Series need not be issued at the same time and, unless otherwise provided, a Series may be reopened for issuances of additional Securities of such Series pursuant to an Authorizing Resolution, an Officers’ Certificate or in any indenture supplemental hereto.

The creation and issuance of a Series and the authentication and delivery thereof are not subject to any conditions precedent.

Section 2.02. Execution and Authentication .

One Officer shall sign the Securities for the Company by manual or facsimile signature. Each Guarantor shall execute the Guarantee in the manner set forth in Section 9.07 .

If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall nevertheless be valid.

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A Security shall not be valid until the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Base Indenture.

The Trustee shall authenticate Securities for original issue upon receipt of an Officers’ Certificate of the Company. Each Security shall be dated the date of its authentication.

Section 2.03. Registrar and Paying Agent .

The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (“ Registrar ”), an office or agency where Securities may be presented for payment (“ Paying Agent ”) and an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Registrar shall keep a register of the Securities and of their transfer and exchange (the “ Security Register ”). The Company may have one or more co-Registrars and one or more additional paying agents. The term “Paying Agent” includes any additional paying agent.

The Company shall enter into an appropriate agency agreement with any Agent not a party to this Base Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall promptly notify the Trustee in writing of the name and address of any such Agent and the Trustee shall have the right to inspect the Securities Register at all reasonable times to obtain copies thereof, and the Trustee shall have the right to rely upon such register as to the names and addresses of the Holders and the principal amounts and certificate numbers thereof. If the Company fails to maintain a Registrar or Paying Agent or fails to give the foregoing notice, the Trustee shall act as such.

The Company initially appoints the Trustee as Registrar and Paying Agent.

Section 2.04. Paying Agent to Hold Money in Trust .

Each Paying Agent shall hold in trust for the benefit of Securityholders and the Trustee all money held by the Paying Agent for the payment of principal of or interest on the Securities, and shall notify the Trustee of any default by the Company in making any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall segregate the money and hold it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon doing so the Paying Agent shall have no further liability for the money.

Section 2.05. Securityholder Lists .

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least five (5) Business Days before each semiannual interest payment date and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders.

Section 2.06. Transfer and Exchange .

Where a Security is presented to the Registrar or a co-Registrar with a request to register a transfer, the Registrar shall register the transfer as requested if the requirements of Section 8-401(a) of the NYUCC are met and the other provisions of this Section 2.06 are satisfied. Where Securities are presented to the Registrar or a co-Registrar with a request to exchange them for an equal principal amount of Securities of other denominations, the Registrar shall make the exchange as requested if the same requirements are met. To permit transfers and exchanges, the Trustee shall authenticate Securities at the Registrar’s request. The Registrar need not transfer or exchange any Security selected for redemption or repurchase, except the unredeemed or repurchased part thereof if the Security is redeemed or repurchased in part, or transfer or exchange any Securities for a period of 15 days before a selection of Securities to be redeemed or repurchased. Any exchange or transfer shall be without charge, except that the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto except in the case of exchanges pursuant to 2.09 , 3.06 , or 10.05 not involving any transfer.

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Any Holder of a Global Security shall, by acceptance of such Global Security, agree that transfers of beneficial interests in such Global Security may be effected only through a book entry system maintained by the Holder of such Global Security (or its agent), and that ownership of a beneficial interest in the Security shall be required to be reflected in a book entry.

Section 2.07. Replacement Securities .

If the Holder of a Security claims that the Security has been lost, destroyed, mutilated or wrongfully taken, the Company shall issue and execute a replacement security, the Guarantors shall execute the related Guarantee and, upon written request of any Officer of the Company, the Trustee shall authenticate such replacement Security, provided , in the case of a lost, destroyed or wrongfully taken Security, that the requirements of Section 8-405 of the NYUCC are met. If any such lost, destroyed, mutilated or wrongfully taken Security shall have matured or shall be about to mature, the Company may, instead of issuing a substitute Security therefor, pay such Security without requiring (except in the case of a mutilated Security) the surrender thereof. An indemnity bond must be sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee and any Agent from any loss which any of them may suffer if a Security is replaced, including the acquisition of such Security by a bona fide purchaser. The Company and the Trustee may charge for its expenses in replacing a Security.

Section 2.08. Outstanding Securities .

Securities outstanding at any time are all Securities authenticated by the Trustee except for those cancelled by it and those described in this Section. A Security does not cease to be outstanding because the Company, any Guarantor or one of their Affiliates holds the Security.

If a Security is replaced pursuant to Section 2.07 , it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a “protected purchaser” (as such term is defined in the NYUCC).

If the Paying Agent holds on a redemption date, purchase date or maturity date money sufficient to pay Securities payable on that date, then on and after that date such Securities cease to be outstanding and interest on them ceases to accrue.

Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

Section 2.09. Temporary Securities .

Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and, upon surrender for cancellation of the temporary Security, the Company and the Guarantors shall execute and the Trustee shall authenticate definitive Securities in exchange for temporary Securities. Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as definitive Securities authenticated and delivered hereunder.

Section 2.10. Cancellation .

The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange, redemption, purchase or payment. The Trustee and no one else shall cancel and destroy, or retain in accordance with its standard retention policy, all Securities surrendered for registration of transfer, exchange, redemption, purchase, payment or cancellation. Unless the Authorizing Resolution or supplemental indenture so provides, the Company may not issue new Securities to replace Securities that it has previously paid or delivered to the Trustee for cancellation.

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Section 2.11. Defaulted Interest .

If the Company defaults in a payment of interest on the Securities of any Series, it shall pay the defaulted interest plus any interest payable on the defaulted interest to the persons who are Securityholders of such Series on a subsequent special record date. The Company shall fix such special record date and a payment date which shall be reasonably satisfactory to the Trustee. At least 15 days before such special record date, the Company shall mail to each Securityholder of the relevant Series a notice that states the record date, the payment date and the amount of defaulted interest to be paid. On or before the date such notice is mailed, the Company shall deposit with the Paying Agent money sufficient to pay the amount of defaulted interest to be so paid. The Company may pay defaulted interest in any other lawful manner if, after notice given by the Company to the Trustee of the proposed payment, such manner of payment shall be deemed practicable by the Trustee.

Section 2.12. Treasury Securities .

In determining whether the Holders of the required principal amount of Securities of a Series have concurred in any direction, waiver, consent or notice, Securities owned by the Company, the Guarantors or any of their respective Affiliates shall be considered as though they are not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which the Trustee actually knows are so owned shall be so considered.

Section 2.13. CUSIP/ISIN Numbers .

The Company in issuing the Securities of any Series may use a “CUSIP” and/or “ISIN” or other similar number, and if so, the Trustee shall use the CUSIP and/or ISIN or other similar number in notices of redemption or exchange as a convenience to Holders of such Securities; provided that no representation is hereby deemed to be made by the Trustee as to the correctness or accuracy of any such CUSIP and/or ISIN or other similar number printed in the notice or on such Securities, and that reliance may be placed only on the other identification numbers printed on such Securities. The Company shall promptly notify the Trustee of any change in any CUSIP and/or ISIN or other similar number.

Section 2.14. Deposit of Moneys .

Prior to 11:00 a.m. New York City time on each interest payment date and maturity date with respect to each Series of Securities, the Company shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments due on such interest payment date or maturity date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders of such Series on such interest payment date or maturity date, as the case may be.

Section 2.15. Book-Entry Provisions for Global Security .

(a) Any Global Security of a Series initially shall (i) be registered in the name of the Depositary or the nominee of such Depositary, (ii) be delivered to the Trustee as custodian for such Depositary and (iii) bear any required legends.

Members of, or participants in, the Depositary (“ Agent Members ”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary, or the Trustee as its custodian, or under the Global Security, and the Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security.

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(b) Transfers of any Global Security shall be limited to transfers in whole, but not in part, to the Depositary, its successors or their respective nominees. Interests of beneficial owners in the Global Security may be transferred or exchanged for Definitive Securities in accordance with the rules and procedures of the Depositary. In addition, Definitive Securities shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Security if (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for the Global Security and a successor depository is not appointed by the Company within 90 days of such notice or (ii) an Event of Default has occurred and is continuing and the Registrar has received a request from the Depositary to issue Definitive Securities.

(c) In connection with any transfer or exchange of a portion of the beneficial interest in any Global Security to beneficial owners pursuant to paragraph (b) , the Registrar shall (if one or more Definitive Securities are to be issued) reflect on its books and records the date and a decrease in the principal amount of the Global Security in an amount equal to the principal amount of the beneficial interest in the Global Security to be transferred, and the Company and the Guarantors shall execute, and the Trustee shall authenticate and deliver, one or more Definitive Securities of like Series and amount.

(d) In connection with the transfer of an entire Global Security to beneficial owners pursuant to paragraph (b) , the Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Company and the Guarantors shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial interest in the Global Security, an equal aggregate principal amount of Definitive Securities of the same Series in authorized denominations.

(e) The Holder of any Global Security may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities of such Series.

(f) Unless otherwise provided in the Authorizing Resolution or supplemental indenture for a particular Series of Securities, each Global Security of such Series shall bear legends in substantially the following forms:

“THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE HOLDERS OF BENEFICIAL INTERESTS HEREIN, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE ANY SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06 OF THE INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.”

“UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR TO ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF ANY ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO SUCH ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.”

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ARTICLE THREE

REDEMPTION

Section 3.01. Notices to Trustee .

Securities of a Series that are redeemable prior to maturity shall be redeemable in accordance with their terms and, unless the Authorizing Resolution or supplemental indenture provides otherwise, in accordance with this Article.

If the Company wants to redeem Securities pursuant to Paragraph 4 of the Securities, it shall notify the Trustee in writing of the redemption date and the principal amount of Securities to be redeemed. Any such notice may be cancelled at any time prior to notice of such redemption being mailed to Holders. Any such cancelled notice shall be void and of no effect.

If the Company wants to credit any Securities previously redeemed, retired or acquired against any redemption pursuant to Paragraph 5 of the Securities, it shall notify the Trustee of the amount of the credit and it shall deliver any Securities not previously delivered to the Trustee for cancellation with such notice.

The Company shall give each notice provided for in this Section 3.01 at least 30 days before the notice of any such redemption is to be mailed to Holders (unless a shorter notice shall be satisfactory to the Trustee).

Section 3.02. Selection of Securities to be Redeemed .

If fewer than all of the Securities of a Series are to be redeemed, the Trustee shall select the Securities to be redeemed by a method the Trustee considers fair and appropriate and in a manner that complies with applicable requirements of the Depositary. The Trustee shall make the selection from Securities outstanding not previously called for redemption and shall promptly notify the Company of the serial numbers or other identifying attributes of the Securities so selected. The Trustee may select for redemption portions of the principal of Securities that have denominations larger than the minimum denomination for the Series. Securities and portions of them it selects shall be in amounts equal to a permissible denomination for the Series. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption.

Section 3.03. Notice of Redemption .

At least 30 days but not more than 60 days before a redemption date, the Company shall mail a notice of redemption by first-class mail, postage prepaid, to each Holder of Securities to be redeemed.

The notice shall identify the Securities to be redeemed and shall state:

(1)

the redemption date;

(2)

the redemption price or the formula pursuant to which such price will be calculated;

(3)

if any Security is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the redemption date, upon surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Security;

(4)

the name and address of the Paying Agent;

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(5)

that Securities called for redemption must be surrendered to the Paying Agent to collect the redemption price;

(6)

that interest on Securities called for redemption ceases to accrue on and after the redemption date; and

(7)

that the Securities are being redeemed pursuant to the mandatory redemption or the optional redemption provisions, as applicable.

At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at its expense; provided , however , that the Company shall deliver to the Trustee at least 15 days prior to the date on which notice of redemption is to be mailed or such shorter period as may be satisfactory to the Trustee, an Officers’ Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph.

Section 3.04. Effect of Notice of Redemption .

Once notice of redemption is mailed, Securities called for redemption become due and payable on the redemption date and at the redemption price as set forth in the notice of redemption. Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price, plus accrued and unpaid interest to the redemption date.

Section 3.05. Deposit of Redemption Price .

On or before the redemption date, the Company shall deposit with the Paying Agent immediately available funds sufficient to pay the redemption price of and accrued interest on all Securities to be redeemed on that date.

Section 3.06. Securities Redeemed in Part .

Upon surrender of a Security that is redeemed in part, the Company and the Guarantors shall execute and the Trustee shall authenticate for each Holder a new Security of the same Series equal in principal amount to the unredeemed portion of the Security surrendered.

ARTICLE FOUR

COVENANTS

Section 4.01. Payment of Securities .

The Company shall pay the principal of and interest on a Series on the dates and in the manner provided in the Securities of the Series. An installment of principal or interest shall be considered paid on the date it is due if the Paying Agent holds on that date money designated for and sufficient to pay the installment.

The Company shall pay interest on overdue principal at the rate borne by the Series; it shall pay interest on overdue installments of interest at the same rate.

Section 4.02. Maintenance of Office or Agency .

The Company shall maintain the office or agency required under Section 2.03 . The Company shall give prior written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee.

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Section 4.03. Compliance Certificate .

The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers’ Certificate stating whether or not the signers know of any continuing Default by the Company in performing any of its obligations under this Indenture. If they do know of such a Default, the certificate shall describe the Default.

The Company shall, so long as any Securities are outstanding under this Indenture, deliver to the Trustee written notice of the occurrence of any Default or Event of Default within 30 days after a Senior Officer of the Company obtains knowledge of such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto. A “ Senior Officer ” of the Company means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, the Treasurer or Chief Legal Officer of the Company.

Section 4.04. Payment of Taxes; Maintenance of Corporate Existence; Maintenance of Properties .

The Company will:

(a) cause to be paid and discharged all lawful taxes, assessments and governmental charges or levies imposed upon the Company and the Guarantors or upon the income or profits of the Company and the Guarantors or upon Property or any part thereof belonging to the Company and the Guarantors before the same shall be in default, as well as all lawful claims for labor, materials and supplies which, if unpaid, might become a lien or charge upon such Property or any part thereof; provided , however , that the Company shall not be required to cause to be paid or discharged any such tax, assessment, charge, levy or claim so long as the validity or amount thereof shall be contested in good faith by appropriate proceedings and the nonpayment thereof does not, in the judgment of the Company, materially adversely affect the ability of the Company and the Guarantors to pay all obligations under this Indenture when due; and provided further that the Company shall not be required to cause to be paid or discharged any such tax, assessment, charge, levy or claim if, in the judgment of the Company, such payment shall not be advantageous to the Company in the conduct of its business and if the failure so to pay or discharge does not, in its judgment, materially adversely affect the ability of the Company and the Guarantors to pay all obligations under this Indenture when due;

(b) cause to be done all things necessary to preserve and keep in full force and effect the corporate existence of the Company and each of the Guarantors and to comply with all applicable laws; provided , however , that nothing in this paragraph (b) shall prevent a consolidation or merger of the Company or any Guarantor not prohibited by the provisions of Article Five , Article Nine or any other provision of this Indenture pertaining to a Series, and the Company may discontinue the corporate existence of any Guarantor, or fail to comply with any such applicable laws, if, in the Company’s judgment, such discontinuance or non-compliance does not materially adversely affect the ability of the Company and the Guarantors to pay all obligations under this Indenture when due; and

(c) at all times keep, maintain and preserve all the Property of the Company and the Guarantors in good repair, working order and condition (reasonable wear and tear excepted) and from time to time make all needful and proper repairs, renewals, replacements, betterments and improvements thereto, so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided , however , that nothing in this paragraph (c) shall prevent the Company from discontinuing the operation and maintenance of any such properties if such discontinuance, in the judgment of the Company, does not materially adversely affect the ability of the Company and the Guarantors to pay all obligations under this Indenture when due.

Section 4.05. Additional Guarantors .

If (a) any Subsidiary that is not a Guarantor shall guarantee any (i) Indebtedness of the Company outstanding under any of the Credit Facilities or (ii) Publicly Traded Debt Securities, or (b) the Company elects to add any Subsidiary as a Guarantor, then such Subsidiary shall (i) execute and deliver to the Trustee a supplemental indenture in form reasonably satisfactory to the Trustee pursuant to which such Subsidiary shall unconditionally guarantee all of the Company’s obligations under the Securities of each Series (other than a Series that, pursuant to

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the applicable supplemental indenture or Authorizing Resolution, does not have the benefit of Guarantees of other Subsidiaries of the Company) and under this Indenture (as it relates to all such Series) on the terms set forth in this Indenture and (ii) deliver to the Trustee an Opinion of Counsel that such supplemental indenture has been duly authorized, executed and delivered by such Subsidiary and constitutes a legal, valid, binding and enforceable obligation of such Subsidiary. Thereafter, such Subsidiary shall be a Guarantor for all purposes of this Indenture (as it relates to all such Series) until it is released from its obligations as a Guarantor pursuant to the provisions of this Indenture.

Section 4.06. Waiver of Stay, Extension or Usury Laws .

The Company and the Guarantors covenant (to the extent that they may lawfully do so) that they will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive the Company or any Guarantor from paying all or any portion of the principal of or interest on the Securities of any Series as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so) the Company and each of the Guarantors expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE FIVE

SUCCESSOR CORPORATION

Section 5.01. When Company May Merge, etc.

Neither the Company nor any Guarantor will consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including by way of liquidation or dissolution), to any Person (in each case other than in a transaction in which the Company or a Guarantor is the survivor of a consolidation or merger, or the transferee in a sale, lease, conveyance or other disposition) unless:

(1) the Person formed by or surviving such consolidation or merger (if other than the Company or the Guarantor, as the case may be), or to which such sale, lease, conveyance or other disposition will be made (collectively, the “ Successor ”), is a corporation or other legal entity organized and existing under the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company or the Guarantor, as the case may be, under the Securities or a Guarantee, as the case may be, and the Indenture, and

(2) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing.

The foregoing provisions shall not apply to:

(A) the consolidation or merger of a Guarantor, or the sale, lease, conveyance or other disposition of all or substantially all of the assets of a Guarantor, which under the provisions of Section 9.03 or the other provisions of this Indenture, results in such Guarantor being released from its Guarantee or the Successor not being required to become a Guarantor, as the case may be, or

(B) a transaction the purpose of which is to change the state of incorporation of the Company or any Guarantor.

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Upon any such consolidation, merger, sale, lease, conveyance or other disposition, the Successor will be substituted for the Company or the relevant Guarantor under the Indenture. The Successor may then exercise every power and right of the Company or the relevant Guarantor under this Indenture, and except in the case of a lease, the Company or the relevant Guarantor will be released from all of its liabilities and obligations in respect of the Securities, the Guarantee and the Indenture. If the Company or a Guarantor leases all or substantially all of its assets, the Company or such Guarantor will not be released from its obligations to pay the principal of and premium, if any, and interest, if any, on the Securities or the Guarantee, as applicable.

ARTICLE SIX

DEFAULTS AND REMEDIES

Section 6.01. Events of Default .

An “ Event of Default ” on a Series occurs if, voluntarily or involuntarily, whether by operation of law or otherwise, any of the following occurs:

(1)

the failure by the Company to pay interest on any Security of such Series when the same becomes due and payable and the continuance of any such failure for a period of 30 days;

(2)

the failure by the Company to pay the principal or premium of any Security of such Series when the same becomes due and payable at maturity, upon acceleration or otherwise;

(3)

the failure by the Company or any Guarantor to comply with any of its agreements or covenants in, or provisions of, the Securities of such Series, the Guarantees (as they relate thereto) or this Indenture (as they relate thereto) and such failure continues for the period and after the notice specified below (except in the case of a default with respect to Article Five (or any other provision specified in the applicable supplemental indenture or Authorizing Resolution), which will constitute Events of Default with notice but without passage of time);

(4)

the acceleration of any Indebtedness (other than Non-Recourse Indebtedness) of the Company or any Guarantor that has an outstanding principal amount of $50 million or more, individually or in the aggregate, and such acceleration does not cease to exist, or such Indebtedness is not satisfied, in either case within 30 days after such acceleration;

(5)

the failure by the Company or any Guarantor to make any principal or interest payment in an amount of $50 million or more, individually or in the aggregate, in respect of Indebtedness (other than Non-Recourse Indebtedness) of the Company or any Guarantor within 30 days of such principal or interest becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such Indebtedness);

(6)

the Company or any Guarantor that is a Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

(A)

commences a voluntary case,

(B)

consents to the entry of an order for relief against it in an involuntary case,

(C)

consents to the appointment of a Custodian of it or for all or substantially all of its Property, or

(D)

makes a general assignment for the benefit of its creditors;

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(7)

a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(A)

is for relief against the Company or any Guarantor that is a Significant Subsidiary as debtor in an involuntary case,

(B)

appoints a Custodian of the Company or any Guarantor that is a Significant Subsidiary or a Custodian for all or substantially all of the Property of the Company or any Guarantor that is a Significant Subsidiary, or

(C)

orders the liquidation of the Company or any Guarantor that is a Significant Subsidiary,

and

the order or decree remains unstayed and in effect for 60 days; or

(8)

any Guarantee of a Guarantor that is a Significant Subsidiary ceases to be in full force and effect (other than in accordance with the terms of such Guarantee and this Indenture) or is declared null and void and unenforceable or found to be invalid or any Guarantor denies its liability under its Guarantee (other than by reason of release of a Guarantor from its Guarantee in accordance with the terms of this Indenture and the Guarantee).

A Default as described in subclause (3) above will not be deemed an Event of Default until the Trustee notifies the Company, or the Holders of at least 25 percent in principal amount of the then outstanding Securities of the applicable Series notify the Company and the Trustee, of the Default and (except in the case of a default with respect to Article Five (or any other provision specified in the applicable supplemental indenture or Authorizing Resolution)) the Company does not cure the Default within 60 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a “Notice of Default.” If such a Default is cured within such time period, it ceases to exist, without any action by the Trustee or any other Person.

The term “ Custodian ” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.

Section 6.02. Acceleration .

If an Event of Default (other than an Event of Default with respect to the Company resulting from subclause (6) or (7) above), shall have occurred and be continuing under the Indenture, the Trustee by notice to the Company, or the Holders of at least 25 percent in principal amount of the Securities of the applicable Series then outstanding by notice to the Company and the Trustee, may declare all Securities of such Series to be due and payable immediately. Upon such declaration of acceleration, the amounts due and payable on the Securities of such Series will be due and payable immediately. If an Event of Default with respect to the Company specified in subclauses (6) or (7) above occurs, all amounts due and payable on the Securities of such Series will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee and the Company or any Holder.

Holders of a majority in principal amount of the then outstanding Securities of such Series may rescind an acceleration with respect to such Series and its consequence (except an acceleration due to nonpayment of principal or interest) if the rescission would not conflict with any judgment or decree and if all existing Events of Default (other than the non-payment of accelerated principal) have been cured or waived.

No such rescission shall extend to or shall affect any subsequent Event of Default, or shall impair any right or power consequent thereon.

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Section 6.03. Other Remedies .

If an Event of Default on a Series occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of or interest on the Series or to enforce the performance of any provision in the Securities or this Indenture applicable to the Series.

The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. To the extent permitted by law, all available remedies are cumulative.

Section 6.04. Waiver of Existing Defaults .

Subject to Section 10.02 , the Holders of a majority in principal amount of the outstanding Securities of a Series on behalf of all the Holders of the Series by notice to the Trustee may waive an existing Default on such Series and its consequences. When a Default is waived, it is cured and stops continuing, and any Event of Default arising therefrom shall be deemed to have been cured; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.

Section 6.05. Control by Majority .

The Holders of a majority in principal amount of the outstanding Securities of a Series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it with respect to such Series. The Trustee, however, may refuse to follow any direction (i) that conflicts with law or this Indenture, (ii) that, subject to Section 7.01 , the Trustee determines is unduly prejudicial to the rights of other Securityholders, (iii) that would involve the Trustee in personal liability, if there shall be reasonable grounds for believing that adequate indemnity against such liability is not reasonably assured to it, or (iv) if the Trustee shall not have been provided with indemnity satisfactory to it.

Section 6.06. Limitation on Suits .

A Securityholder of a Series may not pursue any remedy with respect to this Indenture or the Series unless:

(1)

the Holder gives to the Trustee written notice of a continuing Event of Default on the Series;

(2)

the Holders of at least a majority in principal amount of the outstanding Securities of the Series make a written request to the Trustee to pursue the remedy;

(3)

such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;

(4)

the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and

(5)

no written request inconsistent with such written request shall have been given to the Trustee pursuant to this Section 6.06 .

A Securityholder may not use this Indenture to prejudice the rights of another Holder of Securities of the same Series or to obtain a preference or priority over another Holder of Securities of the same Series.

Section 6.07. Rights of Holders to Receive Payment .

Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal of and interest on any Security, on or after the respective due dates expressed in the Security, or to bring suit for the enforcement of any such payment on or after such respective dates, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.

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Section 6.08. Collection Suit by Trustee .

If an Event of Default in payment of interest or principal specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal and interest remaining unpaid.

Section 6.09. Trustee May File Proofs of Claim .

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements, and advances of the Trustee, its agents and counsel) and the Securityholders allowed in any judicial proceedings relative to the Company, any Guarantor or their respective creditors or Property, and unless prohibited by applicable law or regulation, may vote on behalf of the Holders in any election of a Custodian, and shall be entitled and empowered to collect and receive any moneys or other Property payable or deliverable on any such claims and to distribute the same and any Custodian in any such judicial proceeding is hereby authorized by each Securityholder to make such payments to the Trustee. Nothing herein shall be deemed to authorize the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder or to authorize the Trustee to vote in respect of the claim of any Securityholder except as aforesaid for the election of the Custodian.

Section 6.10. Priorities .

If the Trustee collects any money pursuant to this Article with respect to Securities of any Series, it shall pay out the money in the following order:

First :

to the Trustee for amounts due under Section 7.07 ;

Second :

to Securityholders of the Series for amounts due and unpaid on the Series for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Series for principal and interest, respectively; and

Third :

to the Company or the Guarantors as their interests may appear.

The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section 6.10 .

Section 6.11. Undertaking for Costs .

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit, having the due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in principal amount of the Series.

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ARTICLE SEVEN

TRUSTEE

Section 7.01. Duties of Trustee .

(a) If an Event of Default has occurred and is continuing with respect to Securities of any Series, the Trustee shall, prior to the receipt of directions from the Holders of a majority in principal amount of the Securities of the Series, exercise its rights and powers and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

(b) Except during the continuance of an Event of Default:

(1) The Trustee need perform only those duties that are specifically set forth in this Indenture and no others and no implied covenants or obligations shall be read into this Indenture against the Trustee.

(2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. The Trustee, however, shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture but need not confirm or investigate the accuracy of mathematical calculations or other facts or matters stated therein.

(c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:

(1) This paragraph does not limit the effect of paragraph (b) of this Section.

(2) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts.

(3) The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 or any other direction of the Holders permitted hereunder.

(d) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a) , (b) and (c) of this Section.

(e) The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any loss, liability or expense.

(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

(g) None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there shall be reasonable grounds for believing that the repayment of such funds or adequate indemnity against such liability is not reasonably assured to it.

Section 7.02. Rights of Trustee .

Subject to Section 7.01 :

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(a) The Trustee may rely and shall be protected in acting or refraining from acting on any document, resolution, certificate, instrument, report, or direction believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document, resolution, certificate, instrument, report, or direction.

(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel or both, which shall conform to Sections 11.04 and 11.05 hereof and containing such other statements as the Trustee reasonably deems necessary to perform its duties hereunder. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Officers’ Certificate, Opinion of Counsel or any other direction of the Company permitted hereunder.

(c) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.

(d) The Trustee shall not be liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture.

(e) The Trustee may consult with counsel, and the written advice of such counsel or any Opinion of Counsel as to matters of law shall be full and complete authorization and protection in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

(f) Unless otherwise specifically provided in the Indenture, any demand, request, direction or notice from the Company or a Guarantor shall be sufficient if signed by an Officer of the Company or a Guarantor.

(g) For all purposes under this Indenture, the Trustee shall not be deemed to have notice or knowledge of any Event of Default (other than under Section 6.01(1) or 6.01(2) ) unless a Trust Officer assigned to and working in the Trustee’s corporate trust office has actual knowledge thereof or unless written notice of any Event of Default is received by the Trustee at its address specified in Section 11.02 hereof and such notice references the Securities generally, the Company or this Indenture.

Section 7.03. Individual Rights of Trustee .

The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or any Guarantor or their affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. The Trustee, however, must comply with Sections 7.10 and 7.11 .

Section 7.04. Trustee’s Disclaimer .

The Trustee makes no representation as to the validity or adequacy of this Indenture, the Securities or of any prospectus used to sell the Securities of any Series; it shall not be accountable for the Company’s use of the proceeds from the Securities; it shall not be accountable for any money paid to the Company, or upon the Company’s direction, if made under and in accordance with any provision of this Indenture; it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee; and it shall not be responsible for any statement of the Company or any Guarantor in this Indenture or in the Securities other than its certificate of authentication.

Section 7.05. Notice of Defaults .

If a Default on a Series occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to each Securityholder of the Series notice of the Default (which shall specify any uncured Default known to it) within 90 days after it occurs, provided that in the case of any Default specified in Section 6.01(4) or (5) , no such notice to Securityholders shall be given until at least the end of the 30 day grace period referred to therein. Except in the case of a default in payment of principal of or interest on a Series, the Trustee may withhold the notice if and so long as the board of directors of the Trustee, the executive or any trust committee of such directors and/or responsible officers of the Trustee in good faith determine(s) that withholding the notice is in the interests of Holders of the Series.

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Section 7.06. Reports by Trustee to Holders .

Within 60 days after each May 15 beginning with May 15, 2013, the Trustee shall mail to each Securityholder a brief report dated as of such May 15 that complies with TIA § 313(a) (but if no event described in TIA § 313(1) through (8) has occurred within the twelve months preceding the reporting date no report in relation thereto need be transmitted). The Trustee also shall comply with TIA § 313(b).

A copy of each report at the time of its mailing to Securityholders shall be delivered to the Company and filed by the Trustee with the SEC and each national securities exchange on which the Securities are listed. The Company agrees to notify the Trustee of each national securities exchange on which the Securities are listed.

Section 7.07. Compensation and Indemnity .

The Company shall pay to the Trustee from time to time reasonable compensation for its services subject to any written agreement between the Trustee and the Company. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred by it. Such expenses shall include the reasonable compensation and expenses of the Trustee’s agents and counsel. The Company shall indemnify the Trustee, its officers, directors, employees and agents and hold it harmless against any loss, liability or expense incurred or made by or on behalf of it in connection with the administration of this Indenture or the trust hereunder and its duties hereunder including the costs and expenses of defending itself against or investigating any claim in the premises. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through the Trustee’s, or its officers’, directors’, employees’ or agents’ negligence or bad faith.

Unless otherwise provided in any supplemental indenture or Authorizing Resolution relating to any Series, to ensure the Company’s payment obligations in this Section, the Trustee shall have a claim prior to the Securities of all Series on all money or Property held or collected by the Trustee, except that held in trust to pay principal of or interest on particular Securities. When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 6.01 or in connection with Article Six hereof, the expenses (including the reasonable fees and expenses of its counsel) and the compensation for services in connection therewith are to constitute expenses of administration under any Bankruptcy Law.

Section 7.08. Replacement of Trustee .

The Trustee may resign with respect to Securities of any or all Series by so notifying the Company. The Holders of a majority in principal amount of the outstanding Securities (or of the relevant Series) may remove the Trustee by so notifying the removed Trustee in writing and may appoint a successor trustee with the Company’s consent. Such resignation or removal shall not take effect until the appointment by the Securityholders of the relevant Series or the Company as hereinafter provided of a successor trustee and the acceptance of such appointment by such successor trustee. The Company may remove the Trustee and any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee for any or no reason, including if:

(1)

the Trustee fails to comply with Section 7.10 after written request by the Company or any bona fide Securityholder who has been a Securityholder for at least six months;

(2)

the Trustee is adjudged a bankrupt or an insolvent;

(3)

a receiver or other public officer takes charge of the Trustee or its Property; or

(4)

the Trustee becomes incapable of acting.

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If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor trustee with respect to the Securities of the relevant Series. If a successor trustee does not take office within 45 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or any Holder may petition any court of competent jurisdiction for the appointment of a successor trustee.

A successor trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all Property held by it as Trustee to the successor trustee, the resignation or removal of the retiring Trustee shall become effective, and the successor trustee shall have all the rights, powers and duties of the Trustee under this Indenture. A successor trustee shall mail notice of its succession to each Securityholder.

Section 7.09. Successor Trustee by Merger, etc.

If the Trustee consolidates with, merges with or into or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor trustee.

Section 7.10. Eligibility; Disqualification .

This Indenture shall always have a Trustee who satisfies the requirements of TIA § 310(a)(1). The Trustee shall have a combined capital and surplus of at least $10,000,000 as set forth in its most recent published annual report of condition. The Trustee shall comply with TIA § 310(b).

Section 7.11. Preferential Collection of Claims Against Company .

The Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.

ARTICLE EIGHT

DISCHARGE OF INDENTURE

Section 8.01. Defeasance upon Deposit of Moneys or U.S. Government Obligations .

(a) The Company may, at its option and at any time, elect to have either paragraph (b) or paragraph (c) below be applied to the outstanding Securities of any Series upon compliance with the applicable conditions set forth in paragraph (d) .

(b) Upon the Company’s exercise under paragraph (a) of the option applicable to this paragraph (b) with respect to any Series, the Company and the Guarantors shall be deemed to have been released and discharged from their respective obligations with respect to the outstanding Securities of the Series on the date the applicable conditions set forth below are satisfied (hereinafter, “ Legal Defeasance ”). For this purpose, such Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Securities of a Series, which shall thereafter be deemed to be “outstanding” only for the purposes of the Sections and matters under this Indenture referred to in (i) and (ii) below, and the Company and the Guarantors shall be deemed to have satisfied all their other obligations under such Securities and this Indenture insofar as such Securities are concerned, except for the following which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders of outstanding Securities of a Series to receive solely from the trust fund described in paragraph (d) below and as more fully set forth in such paragraph, payments in respect of the principal of and interest on such Securities when such payments are due and (ii) obligations listed in Section 8.02 , subject to compliance with this Section 8.01 . The Company may exercise its option under this paragraph (b) with respect to a Series notwithstanding the prior exercise of its option under paragraph (c) below with respect to the Securities of the Series.

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(c) Upon the Company’s exercise under paragraph (a) of the option applicable to this paragraph (c) with respect to a Series, the Company and the Guarantors shall be released and discharged from the obligations under any covenant contained in Article Five and Sections 4.04 (but only to the extent it applies to Guarantors), 4.05 and any other covenant contained in or referenced in the Authorizing Resolution or supplemental indenture relating to such Series (to the extent such release and discharge shall not be prohibited thereby), on and after the date the conditions set forth below are satisfied (hereinafter, “ Covenant Defeasance ”), and the Securities of such Series shall thereafter be deemed to be not “outstanding” for the purpose of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder. For this purpose, such Covenant Defeasance means that, with respect to the outstanding Securities of a Series, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01(3) or otherwise, but, except as specified above, the remainder of this Indenture and such Securities shall be unaffected thereby.

(d) The following shall be the conditions to application of either paragraph (b) or paragraph (c) above to the outstanding Securities of the applicable Series:

(1) The Company shall have irrevocably deposited in trust with the Trustee (or another qualifying trustee), pursuant to an irrevocable trust and security agreement in form and substance reasonably satisfactory to the Trustee, money in U.S. dollars or U.S. government obligations or a combination thereof in such amounts and at such times as are sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of and interest on the outstanding Securities of such Series to maturity or redemption; provided , however , that the Trustee (or other qualifying trustee) shall have received an irrevocable written order from the Company instructing the Trustee (or other qualifying trustee) to apply such money or the proceeds of such U.S. government obligations to said payments with respect to the Securities of such Series to maturity or redemption;

(2) No Default or Event of Default (other than a Default or Event of Default resulting from non-compliance with any covenant from which the Company and the Guarantors are released upon effectiveness of such Legal Defeasance or Covenant Defeasance pursuant to paragraph (b) or (c) hereof, as applicable) shall have occurred and be continuing on the date of such deposit or result therefrom;

(3) Such deposit will not result in a breach or violation of, or constitute a default under, any other material instrument or agreement to which the Company or any of any of the Guarantors is a party or by which it or any of their Property is bound;

(4)(i) In the event the Company elects paragraph (b) hereof, the Company shall deliver to the Trustee an Opinion of Counsel in the United States, in form and substance reasonably satisfactory to the Trustee, to the effect that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (B) since the Issue Date pertaining to such Series, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall state that, or (ii) in the event the Company elects paragraph (c) hereof, the Company shall deliver to the Trustee an Opinion of Counsel in the United States, in form and substance reasonably satisfactory to the Trustee, to the effect that, in the case of clauses (i) and (ii) , and subject to customary assumptions and exclusions, Holders of the Securities of such Series will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and the defeasance contemplated hereby and will be subject to federal income tax in the same amounts and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred;

(5) The Company shall have delivered to the Trustee an Officers’ Certificate, stating that the deposit under clause (1) was not made by the Company with the intent of preferring the Holders of the Securities of such Series over any other creditors of the Company or with the intent of defeating, hindering, delaying or defrauding any other creditors of the Company or any Guarantor or others;

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(6) the Company shall have delivered to the Trustee an Opinion of Counsel (subject to customary assumptions and qualifications) to the effect that, assuming no intervening bankruptcy of the Company or any Guarantor between the date of deposit and the 123 ^rd day following the deposit and assuming that no Holder is an “insider” of the Company under applicable Bankruptcy Law, after the 123 ^rd day following the deposit, the trust funds shall not be subject to the effect of Section 547 of the United States Bankruptcy Code or any analogous New York State law provision; and

(7) The Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent specified herein relating to the defeasance contemplated by this Section 8.01 have been complied with.

In the event all or any portion of the Securities of a Series are to be redeemed through such irrevocable trust, the Company must make arrangements satisfactory to the Trustee, at the time of such deposit, for the giving of the notice of such redemption or redemptions by the Trustee in the name and at the expense of the Company.

(e) In addition to the Company’s rights above under this Section 8.01 , the Company may terminate all of its obligations under this Indenture with respect to a Series, and the obligations of the Guarantors shall terminate with respect to such Series (subject to Section 8.02 ), when:

(1) All Securities of such Series theretofore authenticated and delivered (other than Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.07 and Securities for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust) have been delivered to the Trustee for cancellation or all such Securities not theretofore delivered to the Trustee for cancellation (A) have become due and payable, (B) will become due and payable at maturity within one year or (C) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and in each such case, the Company has irrevocably deposited or caused to be deposited with the Trustee (or another qualifying trustee) as trust funds in trust solely for that purpose an amount in U.S. dollars or U.S. government obligations or a combination thereof sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay and discharge the entire Indebtedness on the Securities of such Series not theretofore delivered to the Trustee for cancellation, for principal of and interest on the Securities of such Series, on the date of such deposit or to the maturity or redemption date, as the case may be;

(2) The Company has paid or caused to be paid all other sums payable hereunder by the Company;

(3) The Company has delivered irrevocable instructions to the Trustee (or such other qualifying trustee), to apply the deposited money toward the payment of the Securities of such Series at maturity or redemption, as the case may be; and

(4) The Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, stating that all conditions precedent specified in this Section 8.01(e) relating to the satisfaction and discharge of this Indenture have been complied with.

Section 8.02. Survival of the Company’s Obligations .

Notwithstanding the satisfaction and discharge of this Indenture under Section 8.01 , the Company’s obligations in Paragraph 8 of the Securities and Sections 2.03 through 2.07 , 4.01 , 7.07 , 7.08 , 8.04 and 8.05 , however, shall survive until the Securities of an applicable Series are no longer outstanding. Thereafter, the Company’s obligations in Paragraph 8 of the Securities of such Series and Sections 7.07 , 8.04 and 8.05 shall survive (as they relate to such Series).

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Section 8.03. Application of Trust Money .

The Trustee shall hold in trust money or U.S. government obligations deposited with it pursuant to Section 8.01 . It shall apply the deposited money and the money from U.S. government obligations in accordance with this Indenture to the payment of principal of and interest on the Securities of the defeased Series.

Section 8.04. Repayment to the Company .

The Trustee and the Paying Agent shall promptly pay to the Company upon request any excess money or securities held by them at any time. The Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the payment of principal or interest that remains unclaimed for two years, provided , however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once in a newspaper of general circulation in the City of New York or mail to each such Holder notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication or mailing, any unclaimed balance of such money then remaining will be repaid to the Company. After payment to the Company, Securityholders entitled to the money must look to the Company or any Guarantor for payment as general creditors unless applicable abandoned property law designates another person and all liability of the Trustee or such Paying Agent with respect to such money shall cease.

Section 8.05. Reinstatement .

If the Trustee is unable to apply any money or U.S. government obligations in accordance with Section 8.01 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s and each Guarantor’s obligations under this Indenture and the Securities relating to the Series shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.01 until such time as the Trustee is permitted to apply all such money or U.S. government obligations in accordance with Section 8.01 ; provided , however , that (a) if the Company or any Guarantor has made any payment of interest on or principal of any Securities of the Series because of the reinstatement of its obligations hereunder, the Company or Guarantor shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S. government obligations held by the Trustee and (b) unless otherwise required by any legal proceeding or any order or judgment of any court or governmental authority, the Trustee shall return all such money or U.S. government obligations to the Company promptly after receiving a written request therefor at any time, if such reinstatement of the Company’s or Guarantor’s obligations has occurred and continues to be in effect.

ARTICLE NINE

GUARANTEES

Section 9.01. Unconditional Guarantees .

Subject to any other provisions set forth in the Authorizing Resolution or supplemental indenture relating to a particular Series, each Guarantor unconditionally, jointly and severally, guarantees (each such guarantee to be referred to herein as the “ Guarantee ”) to each Holder of Securities of such Series authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, that: (i) the principal of and interest on the Securities of such Series will be promptly paid in full when due, subject to any applicable grace period, whether at maturity, by acceleration or otherwise and interest on the overdue principal, if any, and interest on any interest of the Securities of such Series and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder, except obligations to pay principal of and interest on any other Series not so guaranteed, will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any Securities of such Series or of any such other obligations, the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, subject to any applicable grace period, whether at stated maturity, by acceleration or otherwise, subject, however, in

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the case of clauses (i) and (ii) above, to the limitations set forth in Section 9.04 . Each Guarantor agrees that its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Securities of such Series or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Securities of such Series with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. Each Guarantor waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenants that, subject to Section 9.03 , this Guarantee will not be discharged except by complete performance of the obligations contained in the Securities of the applicable Series, this Indenture and in this Guarantee. If any Holder or the Trustee is required by any court or otherwise to return to the Company, any Guarantor, or any custodian, trustee, liquidator or other similar official acting in relation to the Company or any Guarantor, any amount paid by the Company or any Guarantor to the Trustee or such Holder, this Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect. Each Guarantor further agrees that, as between each Guarantor, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article Six for the purposes of this Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any acceleration of such obligations as provided in Article Six , such obligations (whether or not due and payable) shall forthwith become due and payable by each Guarantor for the purpose of this Guarantee.

Section 9.02. Severability .

In case any provision of this Guarantee shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 9.03. Release of a Guarantor .

Notwithstanding anything in this Indenture to the contrary, in the event of (i) the sale or other disposition of Capital Stock of any Guarantor if as a result of such disposition, such Person ceases to be a Subsidiary of the Company, (ii) a sale or other disposition of all or substantially all of the assets of any Guarantor (other than to the Company or another Guarantor), (iii) a merger or consolidation of a Guarantor with a Person other than the Company or another Guarantor, or (iv) a Guarantor ceasing to guarantee any (a) Indebtedness of the Company outstanding under any of the Credit Facilities and (b) Publicly Traded Debt Securities, then such Guarantor (in the case of clauses (i), (ii) and (iv) above) will be automatically and unconditionally released and discharged from all obligations under this Article Nine , the other provisions of this Indenture and the Securities and the Person acquiring such assets (in the case of clauses (ii) and (iii) above) shall not be required to assume the Guarantor’s obligations under this Article Nine , the other provisions of this Indenture and the Securities or otherwise become a Guarantor, in each case without any further action required on the part of the Trustee, any Holder, the Company or any Guarantor; provided that such sale, disposition or other transaction is otherwise in compliance with this Indenture.

Nothing contained in this Indenture or in any of the Securities shall prevent any consolidation or merger of a Guarantor with or into the Company or another Guarantor, or shall prevent any sale, lease, conveyance or other disposition of all or substantially assets of a Guarantor to the Company or another Guarantor. Upon any such consolidation, merger, or disposition, the Guarantee given by such Guarantor shall no longer have any force or effect.

The Trustee shall deliver an appropriate instrument evidencing any such release upon receipt of a request by the Company accompanied by an Officers’ Certificate and Opinion of Counsel certifying as to the compliance with this Section 9.03 .

Any Guarantor not released in accordance with this Section 9.03 remains liable for the full amount of principal of and interest on the Securities as provided in this Article Nine , except as provided in Article Eight .

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Section 9.04. Limitation of a Guarantor’s Liability .

Each Guarantor and by its acceptance hereof each Holder confirms that it is the intention of all such parties that the guarantee by such Guarantor pursuant to its Guarantee not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or state law. To effectuate the foregoing intention, the Holders and such Guarantor irrevocably agree that the obligations of such Guarantor under the Guarantee shall be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee or pursuant to Section 9.05 , result in the obligations of such Guarantor under the Guarantee not constituting such fraudulent transfer or conveyance.

Section 9.05. Contribution .

In order to provide for just and equitable contribution among the Guarantors, the Guarantors agree, inter se, that in the event any payment or distribution is made by any Guarantor (a “ Funding Guarantor ”) under the Guarantee, such Funding Guarantor shall be entitled to a contribution from all other Guarantors in a pro rata amount based on the Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all payments, damages and expenses incurred by that Funding Guarantor in discharging the Company’s obligations with respect to any Securities or any other Guarantor’s obligations with respect to its Guarantee. “Adjusted Net Assets” of such Guarantor at any date shall mean the lesser of the amount by which (x) the fair value of the Property of such Guarantor exceeds the total amount of liabilities, including contingent liabilities (after giving effect to all other fixed and contingent liabilities incurred or assumed on such date and after giving effect to any collection from any other Subsidiary of the Guarantor in respect of the obligations of its Guarantee), but excluding liabilities under the Guarantee, of such Guarantor at such date and (y) the present fair salable value of the assets of such Guarantor at such date exceeds the amount that will be required to pay the probable liability of such Guarantor on its debts (after giving effect to all other fixed and contingent liabilities incurred or assumed on such date and after giving effect to any collection from any other Subsidiary of the Company in respect of the obligations of such Guarantor under its Guarantee), excluding debt in respect of the Guarantee of such Guarantor, as they become absolute and matured.

Section 9.06. Waiver of Subrogation .

Until all guaranteed obligations under this Indenture and with respect to all Securities of an applicable Series are paid in full, each Guarantor irrevocably waives any claim or other rights which it may now or hereafter acquire against the Company that arise from the existence, payment, performance or enforcement of such Guarantor’s obligations under the Guarantee and this Indenture, including any right of subrogation, reimbursement, exoneration, indemnification, and any right to participate in any claim or remedy of any Holder of Securities of the applicable Series against the Company, whether or not such claim, remedy or right arises in equity, or under contract, statute or common law, including the right to take or receive from the Company, directly or indirectly, in cash or other Property or by set-off or in any other manner, payment or security on account of such claim or other rights. If any amount shall be paid to any Guarantor in violation of the preceding sentence and the Securities of the applicable Series shall not have been paid in full, such amount shall have been deemed to have been paid to such Guarantor for the benefit of, and held in trust for the benefit of, the Holders of the Securities of the applicable Series, and shall forthwith be paid to the Trustee for the benefit of such Holders to be credited and applied upon the Securities of the applicable Series, whether matured or unmatured, in accordance with the terms of this Indenture. Each Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that the waiver set forth in this Section 9.06 is knowingly made in contemplation of such benefits.

Section 9.07. Execution of Guarantee .

To evidence their guarantee to the Holders set forth in this Article Nine with respect to any Series, the Guarantors shall execute the Guarantee in substantially the form included in Exhibit A or in any such other form set forth in the Authorizing Resolution or supplemental indenture pertaining to the applicable Series, which shall be endorsed on each Security ordered to be authenticated and delivered by the Trustee. Each Guarantor agrees that its

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Guarantee set forth in this Article Nine shall remain in full force and effect notwithstanding any failure to endorse on each Security a notation of such Guarantee. Each such Guarantee shall be signed on behalf of each Guarantor by one Officer (who shall, in each case, have been duly authorized by all requisite corporate or other actions) shall attest to such Guarantee prior to the authentication of the Security on which it is endorsed, and the delivery of such Security by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of such Guarantee on behalf of such Guarantor. Such signature upon the Guarantee may be by manual or facsimile signature of such officer and may be imprinted or otherwise reproduced on the Guarantee, and in case any such officer who shall have signed the Guarantee shall cease to be such officer before the Security on which such Guarantee is endorsed shall have been authenticated and delivered by the Trustee or disposed of by the Company, such Security nevertheless may be authenticated and delivered or disposed of as though the person who signed the Guarantee had not ceased to be such officer of the Guarantor.

ARTICLE TEN

AMENDMENTS, SUPPLEMENTS AND WAIVERS

Section 10.01. Without Consent of Holders .

The Company, the Guarantors and the Trustee may amend or supplement this Indenture or the Securities of a Series without notice to or consent of any Securityholder of such Series:

(1) to cure any ambiguity, omission, defect or inconsistency;

(2) to comply with Article Five ;

(3) to provide that specific provisions of this Indenture shall not apply to a Series not previously issued or to make a change to specific provisions of this Indenture that only applies to any Series not previously issued or to additional Securities of a Series not previously issued;

(4) to create a Series and establish its terms;

(5) to provide for uncertificated Securities in addition to or in place of certificated Securities;

(6) to release a Guarantor in respect of any Series which, in accordance with the terms of this Indenture applicable to the particular Series, ceases to be liable in respect of its Guarantee;

(7) to add a Guarantor in respect of any Series;

(8) to comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA; and

(9) to make any other change that does not adversely affect the rights of Securityholders.

After an amendment under this Section 10.01 becomes effective, the Company shall mail notice of such amendment to the Securityholders.

Section 10.02. With Consent of Holders .

The Company, the Guarantors and the Trustee may amend or supplement this Indenture or the Securities of a Series with the written consent of the Holders of at least a majority in principal amount of the outstanding Securities of each Series affected by the amendment (including consents obtained in connection with a purchase of, or tender offer or exchange offer for, Securities of such Series). Each such Series shall vote as a separate class. The Holders of a majority in principal amount of the outstanding

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Securities of any Series may waive compliance by the Company with any provision of the Securities of such Series or of this Indenture relating to such Series (including any waiver granted in connection with a purchase of, or tender offer or exchange offer for, Securities of such Series). Without the consent of each Holder of a Security affected thereby, however, an amendment, supplement or waiver, including a waiver pursuant to Section 6.04 , may not:

(1)

reduce the amount of Securities of the relevant Series whose Holders must consent to an amendment, supplement or waiver;

(2)

reduce the rate of or change the time for payment of interest, including defaulted interest, on any Security;

(3)

reduce the principal of or change the fixed maturity of any Security or alter the provisions (including related definitions) with respect to redemption of any Security pursuant to Article Three hereof;

(4)

modify the ranking or priority of the Securities of the relevant Series or any Guarantee thereof;

(5)

release any Guarantor from any of its obligations under its Guarantee or this Indenture otherwise than in accordance with the terms of this Indenture;

(6)

make any change in Sections 6.04 , 6.07 or this Section 10.02 ;

(7)

waive a continuing Default or Event of Default in the payment of the principal of or interest on any Security; or

(8)

make any Security payable at a place or in money other than that stated in the Security, or impair the right of any Securityholder to bring suit as permitted by Section 6.07 .

An amendment of a provision included solely for the benefit of one or more Series does not affect the interests of Securityholders of any other Series.

It shall not be necessary for the consent of the Holders under this Section to approve the particular form of any proposed supplement, but it shall be sufficient if such consent approves the substance thereof.

Section 10.03. Compliance with Trust Indenture Act .

Every amendment to or supplement of this Indenture or any Securities shall comply with the TIA as then in effect.

Section 10.04. Revocation and Effect of Consents .

A consent to an amendment, supplement or waiver by a Holder shall bind the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security. Unless otherwise provided in the consent or the consent solicitation statement or other document describing the terms of the consent, any Holder or subsequent Holder may revoke the consent as to its Security or portion of a Security. Any revocation of a consent by the Holder of a Security or any such subsequent Holder shall be effective only if the Trustee receives the notice of revocation before the date on which the Trustee receives an Officers’ Certificate from the Company certifying that the requisite number of consents have been received.

The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders of Securities of any Series entitled to consent to any amendment, supplement or waiver. If a record date is fixed, and if Holders otherwise have a right to revoke their consent under the consent or the consent solicitation statement or other

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document describing the terms of the consent, then notwithstanding the second to last sentence of the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 90 days after such record date.

An amendment, supplement or waiver with respect to a Series becomes effective upon the (i) receipt by the Company or the Trustee of the requisite consents, (ii) satisfaction of any conditions to effectiveness as set forth in this Indenture or any indenture supplemental hereto containing such amendment, supplement or waiver and (iii) execution of such amendment, supplement or waiver (or the related supplemental indenture) by the Company and the Trustee. After an amendment, supplement or waiver with respect to a Series becomes effective, it shall bind every Holder of such Series, unless it makes a change described in any of clauses (1) through (8) of Section 10.02 , in which case, the amendment, supplement or waiver shall bind a Holder of a Security who is affected thereby only if it has consented to such amendment, supplement or waiver and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security; provided that no such waiver shall impair or affect the right of any Holder to receive payment of principal of and interest on a Security, on or after the respective due dates expressed in such Security, or to bring suit for the enforcement of any such payment on or after such respective dates without the consent of such Holder.

Section 10.05. Notation on or Exchange of Securities .

If an amendment, supplement or waiver changes the terms of a Security, the Company may require the Holder of the Security to deliver it to the Trustee, at which time the Trustee shall place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms.

Section 10.06. Trustee to Sign Amendments, etc.

Subject to Section 7.02(b) , the Trustee shall sign any amendment, supplement or waiver authorized pursuant to this Article if the amendment, supplement or waiver does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may but need not sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee shall be entitled to receive and shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel as conclusive evidence that such amendment, supplement or waiver is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company and any Guarantors in accordance with its terms.

Section 10.07. Notice of Supplemental Indenture .

Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to Section 10.02 , the Company shall transmit to the Holders of outstanding Securities of any Series affected thereby a notice setting forth in general terms the substance of such supplemental indenture; provided that a filing of the supplemental indenture or a description thereof in a filing by the Company with the SEC pursuant to EDGAR or successor system shall satisfy this requirement. Failure to send such notice will not impair the validity of such supplemental indenture.

ARTICLE ELEVEN

MISCELLANEOUS

Section 11.01. Trust Indenture Act Controls .

If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control.

Section 11.02. Notices .

Any order, consent, notice or communication shall be sufficiently given if in writing and delivered in person or mailed by first class mail, postage prepaid, addressed as follows:

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if to the Company or to any Guarantor:

D.R. Horton, Inc.

301 Commerce Street, Suite 500

Forth Worth, Texas 76102

Attention: Chief Financial Officer

if to the Trustee:

American Stock Transfer & Trust Company, LLC

59 Maiden Lane

Plaza Level

New York, NY 10038

Attention: Corporate Trust Administration

The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

Any notice or communication mailed to a Securityholder shall be mailed to him by first class mail at his address as it appears on the registration books of the Registrar and shall be sufficiently given to him if so mailed within the time prescribed.

Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it except that notice to the Trustee shall only be effective upon receipt thereof by the Trustee.

If the Company mails notice or communications to the Securityholders, it shall mail a copy to the Trustee at the same time.

Section 11.03. Communications by Holders with Other Holders .

Securityholders may communicate pursuant to TIA § 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA § 312(c).

Section 11.04. Certificate and Opinion as to Conditions Precedent .

Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee:

(1)

an Officers’ Certificate (which shall include the statements set forth in Section 11.05 ) stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(2)

an Opinion of Counsel (which shall include the statements set forth in Section 11.05 ) stating that, in the opinion of such counsel, all such conditions precedent and covenants, compliance with which constitutes a condition precedent, if any, provided for in this Indenture relating to the proposed action or inaction, have been complied with and that any such section does not conflict with the terms of this Indenture.

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Section 11.05. Statements Required in Certificate or Opinion .

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:

(1)

a statement that the person making such certificate or opinion has read such covenant or condition;

(2)

a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(3)

a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(4)

a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with.

Section 11.06. Rules by Trustee and Agents .

The Trustee may make reasonable rules for action by or a meeting of Securityholders. The Registrar or Paying Agent may make reasonable rules for its functions.

Section 11.07. Legal Holidays .

A “ Legal Holiday ” is a Saturday, a Sunday, a legal holiday or a day on which banking institutions in Fort Worth, Texas and New York, New York are not required to be open. If a payment date is a Legal Holiday, payment may be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If this Indenture provides for a time period that ends or requires performance of any non-payment obligation by a day that is not a Business Day, then such time period shall instead be deemed to end on, and such obligation shall instead be performed by, the next succeeding Business Day. A “ Business Day ” is any day other than a Legal Holiday.

Section 11.08. Governing Law .

The laws of the State of New York shall govern this Indenture, the Securities of each Series and the Guarantees.

Section 11.09. No Adverse Interpretation of Other Agreements .

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

Section 11.10. No Recourse Against Others .

All liability (i) described in Paragraph 12 of the Securities of any director, officer, employee or stockholder, as such, of the Company and (ii) described in the second paragraph of the guarantees of each Guarantor of any stockholder, officer, director, employee, incorporator, partner, member or manager, as such, of any Guarantor, is waived and released.

Section 11.11. Successors and Assigns .

All covenants and agreements of the Company and the Guarantors in this Indenture and the Securities shall bind their respective successors and assigns. All agreements of the Trustee in this Indenture shall bind its successors and assigns.

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Section 11.12. Duplicate Originals .

The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

Section 11.13. Severability .

In case any one or more of the provisions contained in this Indenture or in the Securities of a Series shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Indenture or of such Securities.

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SIGNATURES

IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed, all as of the date first above written.


D.R. HORTON, INC.

By:
		Name:
		Title:


AMERICAN STOCK TRANSFER & TRUST COMPANY , LLC, as Trustee

By:
		Name:
		Title:

EXHIBIT A


No.		CUSIP/ISIN No.:

[Title of Security]

D.R. HORTON, INC.

a Delaware corporation

promises to pay to or registered assigns

the principal sum of [Dollars]* on

Interest Payment Dates: and

Record Dates: and


		Dated:


D.R. HORTON, INC.

By:
		Title:

Authenticated:


American Stock Transfer & Trust Company, LLC, as Trustee, certifies that this is one of the Securities referred to in the within mentioned Indenture.

By:
		Authorized Signatory

*	Or other currency. Insert corresponding provisions on reverse side of Security in respect of foreign currency denomination or interest payment requirement.

A-1

D.R. HORTON, INC.

[Title of Security]

D.R. HORTON, INC., a Delaware corporation (together with its successors and assigns, the “ Company ”), issued this Security under an Indenture dated as of May 1, 2012 (as amended, modified or supplemented from time to time in accordance therewith, the “ Base Indenture ”), as supplemented by the Supplemental Indenture dated as of (the “ Supplemental Indenture ” and together with the Base Indenture, the “ Indenture ”), by and among the Company, the Guarantors party thereto and American Stock Transfer & Trust Company, LLC, as trustee (in such capacity, the “ Trustee ”), to which reference is hereby made for a statement of the respective rights, obligations, duties and immunities thereunder of the Company, the Trustee and the Holders and of the terms upon which the Securities are, and are to be, authorized and delivered. All terms used in this Security that are defined in the Indenture shall have the meanings assigned to them therein.

1.	Interest .

The Company promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest semiannually on and of each year, commencing , , until the principal is paid or made available for payment. Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from , , provided that, if there is no existing default in the payment of interest, and if this Security is authenticated between a record date referred to on the face hereof and the next succeeding interest payment date, interest shall accrue from such interest payment date. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2.	Method of Payment .

The Company will pay interest on the Securities (except defaulted interest, if any, which will be paid on such special payment date to Holders of record on such special record date as may be fixed by the Company) to the persons who are registered Holders of Securities at the close of business on the [Insert record dates] immediately preceding the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.

3.	Paying Agent and Registrar .

Initially, the Trustee will act as Paying Agent and Registrar. The Company may change or appoint any Paying Agent, Registrar or co-Registrar without notice. The Company or any of its Subsidiaries or any of their Affiliates may act as Paying Agent, Registrar or co-Registrar.

4.	Optional Redemption . ¹

The Company may redeem the Securities at any time on or after , in whole or in part, at the following redemption prices (expressed as a percentage of their principal amount) together with interest accrued and unpaid to the date fixed for redemption:


If redeemed during the twelve-month period commencing on and ending on in each of the following years		Percentage

[Insert provisions relating to redemption at option of Holders, if any]

¹	If applicable.

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Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at its registered address. Securities in denominations larger than $2,000 ² may be redeemed in part. On and after the redemption date interest ceases to accrue on Securities or portions of them called for redemption, provided that if the Company shall default in the payment of such Securities at the redemption price together with accrued interest, interest shall continue to accrue at the rate borne by the Securities.

5.	Mandatory Redemption . ³

The Company shall redeem [ ]% of the aggregate principal amount of Securities originally issued under the Indenture on each of [ ], which redemptions are calculated to retire [ ]% of the Securities originally issued prior to maturity. Such redemptions shall be made at a redemption price equal to 100% of the principal amount thereof, together with accrued interest to the redemption date. The Company may reduce the principal amount of Securities to be redeemed pursuant to this Paragraph 5 by the principal amount of any Securities previously redeemed, retired or acquired, otherwise than pursuant to this Paragraph 5 , that the Company has delivered to the Trustee for cancellation and not previously credited to the Company’s obligations under this Paragraph 5 . Each such Security shall be received and credited for such purpose by the Trustee at the redemption price and the amount of such mandatory redemption payment shall be reduced accordingly.

6.	Denominations, Transfer, Exchange .

The Securities are in registered form only without coupons in denominations of $2,000 ⁴ and integral multiples of $1,000 in excess thereof. ⁵ A Holder may transfer or exchange Securities by presentation of such Securities to the Registrar or a co-Registrar with a request to register the transfer or to exchange them for an equal principal amount of Securities of other denominations. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not transfer or exchange any Security selected for redemption or purchase, except the unredeemed or unpurchased part thereof if the Security is redeemed or purchased in part, or transfer or exchange any Securities for a period of 15 days before a selection of Securities to be redeemed or purchased.

7.	Persons Deemed Owners .

The registered Holder of this Security shall be treated as the owner of it for all purposes.

8.	Unclaimed Money .

Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay to the Company upon written request any money held by them for the payment of principal or interest that remains unclaimed for two years, and thereafter, Holders entitled to the money must look to the Company for payment as general creditors.

²	Insert different or additional denominations and multiples.

³	If applicable.

⁴	Insert different or additional denominations and multiples.

⁵	Insert different or additional denominations and multiples.

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9.	Amendment, Supplement, Waiver .

Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the outstanding Securities of each Series affected by the amendment and any past default or compliance with any provision relating to any Series of the Securities may be waived in a particular instance with the consent of the Holders of a majority in principal amount of the outstanding Securities of such Series. ¹ Without the consent of any Securityholder, the Company and the Trustee may amend or supplement the Indenture or the Securities in certain respects as specified in the Indenture.

10.

Successor .

When a successor assumes all the obligations of its predecessor under the Securities and the Indenture, the predecessor will be released from those obligations.

11.

Trustee Dealings With Company .

Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its affiliates, and may otherwise deal with the Company or its affiliates, as if it were not Trustee, including owning or pledging the Securities.

12.

No Recourse Against Others .

A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of, such obligations or their creation. Each Holder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. The waiver may not be effective to waive liabilities under the federal securities laws.

13.

Discharge of Indenture .

The Indenture contains certain provisions pertaining to defeasance and discharge, which provisions shall for all purposes have the same effect as if set forth herein.

14.

Authentication .

This Security shall not be valid until an authorized signatory of the Trustee signs the certificate of authentication on the other side of this Security.

15.

Abbreviations .

Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors Act).

16.

GOVERNING LAW .

THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

⁶	If different terms apply, insert a brief summary thereof.

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17.

CUSIP and ISIN Numbers .

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP and ISIN numbers to be printed on the Securities and has directed the Trustee to use CUSIP and ISIN numbers in notices of repurchase as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of repurchase and reliance may be placed only on the other identification numbers placed thereon.

18.

Copies .

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture and the applicable Authorizing Resolution or supplemental indenture. Requests may be made to: D.R. Horton, Inc., 301 Commerce St., Suite 500, Fort Worth, Texas 76102, Attention: Chief Financial Officer.

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ASSIGNMENT FORM

If you the Holder want to assign this Security, fill in the form below:


		I or we assign and transfer this Security to


		(Insert assignee’s social security or tax ID number)








		(Print or type assignee’s name, address, and zip code)

and irrevocably appoint

agent to transfer this Security on the books of the Company. The agent may substitute another to act for him.

Date:

Your signature:

(Sign exactly as your name appears on the other side of this Security)

Signature Guarantee:

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Security Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Security Registrar in addition to, or in substitution for, STAMP, all in accordance with the United States Securities Exchange Act of 1934, as amended.

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[FORM OF NOTATION ON SECURITY OF GUARANTEE]

GUARANTEE

The undersigned (the “ Guarantors ”) have unconditionally guaranteed, jointly and severally (such guarantee by each Guarantor being referred to herein as the “ Guarantee ”) (i) the due and punctual payment of the principal of and interest on this Security, whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and interest, if any, on this Security, to the extent lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth in Article Nine of the Indenture and (ii) in case of any extension of time of payment or renewal of this Security or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.

No past, present or future stockholder, officer, director, employee, incorporator, partner, member or manager, as such, of any of the Guarantors shall have any liability under the Guarantee by reason of such person’s status as stockholder, officer, director, employee, incorporator, partner, member or manager. Each Holder of a Security by accepting a Security waives and releases all such liability. This waiver and release are part of the consideration for the issuance of the Guarantees.

Each Holder of this Security by accepting this Security agrees that any Guarantor named below shall have no further liability with respect to its Guarantee if such Guarantor otherwise ceases to be liable in respect of its Guarantee in accordance with the terms of the Indenture.

THE GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

The Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Securities upon which the Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers.


[List of Guarantors]

By:
		Title:

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Exhibit 4.2

D.R. HORTON, INC. AND THE GUARANTORS PARTY HERETO

4.750% Senior Notes due 2017

Supplemental Indenture

Dated as of May 1, 2012

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,

Trustee

TABLE OF CONTENTS


		Page
ARTICLE ONE

SCOPE OF SUPPLEMENTAL INDENTURE

Section 1.01.	General		1
Section 1.02.	Specified Modifications in Respect of the Notes		2

ARTICLE TWO

CERTAIN DEFINITIONS

ARTICLE THREE

COVENANTS

Section 3.01.	Limitations on Secured Debt		10
Section 3.02.	Restrictions on Sale and Leaseback Transactions		11
Section 3.03.	Offer to Purchase upon Change of Control Triggering Event		12

ARTICLE FOUR

MISCELLANEOUS

Section 4.01.	Governing Law		13
Section 4.02.	No Adverse Interpretation of Other Agreements		13
Section 4.03.	No Recourse Against Others		13
Section 4.04.	Successors and Assigns		14
Section 4.05.	Duplicate Originals		14
Section 4.06.	Severability		14



Exhibit A		Form of Security
Exhibit B		Form of Notification Security of Guaranee

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First Supplemental Indenture dated as of May 1, 2012 (“ Supplemental Indenture ”), to the Indenture dated as of May 1, 2012 (as amended, modified or supplemented from time to time in accordance therewith, the “ Base Indenture ”), by and among D.R. Horton, Inc., a Delaware corporation (the “ Company ”), each of the subsidiaries of the Company that are signatories hereto as the initial guarantors (the “ Initial Guarantors ”) and American Stock Transfer & Trust Company, LLC, as trustee (the “ Trustee ”).

Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of Notes (each as defined herein):

WHEREAS, the Company and the Trustee have duly authorized the execution and delivery of the Base Indenture to provide for the issuance from time to time of senior debt securities (the “Securities”) to be issued in one or more Series as in the Base Indenture provided;

WHEREAS, the Company and the Initial Guarantors desire and have requested the Trustee to join them in the execution and delivery of this Supplemental Indenture in order to establish and provide for the issuance by the Company of a Series of Securities designated as its 4.750% Senior Notes due 2017, substantially in the form attached hereto as Exhibit A (including any Additional Notes, as defined below, the “ Notes ”), initially guaranteed by the Initial Guarantors, on the terms set forth herein;

WHEREAS, Section 2.01 of the Base Indenture provides that a supplemental indenture may be entered into by the Company, the Initial Guarantors and the Trustee for such purpose provided certain conditions are met;

WHEREAS, the conditions set forth in the Base Indenture for the execution and delivery of this Supplemental Indenture have been complied with; and

WHEREAS, all things necessary to make this Supplemental Indenture a valid agreement of the Company, the Initial Guarantors and the Trustee, in accordance with its terms, and a valid amendment of, and supplement to, the Base Indenture have been done;

NOW, THEREFORE:

In consideration of the premises and the purchase and acceptance of the Notes by the Holders thereof the Company and the Initial Guarantors mutually covenant and agree with the Trustee, for the equal and ratable benefit of the Holders, that the Base Indenture is supplemented and amended, to the extent expressed herein, as follows:

ARTICLE ONE

Scope of Supplemental Indenture

Section 1.01. General .

The changes, modifications and supplements to the Base Indenture effected by this Supplemental Indenture shall be applicable only with respect to, and govern the terms of, the Notes and shall not apply to any other Securities that may have been or may hereafter be issued under the Base Indenture unless a supplemental indenture with respect to such other Securities specifically incorporates such changes, modifications and supplements.

Pursuant to this Supplemental Indenture, there is hereby created and designated the Notes as a Series of Securities under the Base Indenture entitled “4.750% Senior Notes due 2017.” The Notes shall be substantially in the form of Exhibit A hereto and will mature and bear interest as provided in such form and have the other terms and conditions set forth therein, this Supplemental Indenture and the Base Indenture (to the extent not superseded hereby). The Company shall pay interest on overdue principal at 4.750%; it shall pay interest on overdue installments of interest at 4.750%. The Notes shall be guaranteed by the Guarantors as provided in the form of Exhibit B hereto. The Trustee will initially be the Registrar and Paying Agent for the Notes, and DTC will initially be the Depositary for the Notes. The covenants provided in Article Three of this Supplemental Indenture are applicable (unless waived or amended as provided in the Base Indenture) so long as the Notes are outstanding or until defeasance or other discharge pursuant to the Base Indenture. An aggregate principal amount of $350.0 million of Notes will be issued on the Issue Date. Additional Notes (the “Additional Notes”) in an unlimited amount may be issued in one or more issuances from time to time on the same terms and conditions, except for issue date, and if applicable, the issue price and the first interest payment, either of which may differ from the respective terms of the previously issued Notes of same Series, and with the same CUSIP numbers as the Notes offered hereby without the consent of Holders of the Notes. The Notes initially issued hereunder and any such Additional Notes shall vote on all matters, and otherwise be treated as, a single Series for all purposes under the Indenture.

Section 1.02. Specified Modifications in Respect of the Notes .(1) Article Six of the Base Indenture shall apply in respect of the Notes; provided that with respect to clause (3) under the first paragraph and the second paragraph of Section 6.01 of the Base Indenture, Section 3.03 hereof shall be deemed such specified provision which breach thereof shall constitute, together with Article Five of the Base Indenture, an Event of Default with notice but without passage of time.

(2) Section 7.05 of the Base Indenture shall apply in respect of the Notes; provided that the Trustee shall not have any discretion to withhold any notice of the Default with respect to any breach of Section 3.03 hereof, irrespective of any determination that withholding of such notice is in the interest of the Holders of the Notes.

(3) Article Ten of the Base Indenture shall apply in respect of the Notes; provided that, notwithstanding anything to the contrary in the Base Indenture and this Supplemental Indenture, any amendment or waiver of Section 3.03 hereof (prior to the occurrence of a Change of Control Triggering Event) will require consent of Holders of a majority of the outstanding principal amount of Notes.

ARTICLE TWO

Certain Definitions

The following terms have the meanings set forth below in this Supplemental Indenture. Capitalized terms used but not defined herein have the meanings ascribed to such terms in the Base Indenture. To the extent terms defined herein differ from the Base Indenture the terms defined herein will govern.

“ Attributable Debt ” means, in respect of a Sale and Leaseback Transaction, the present value (discounted at the weighted average effective interest cost per annum of the outstanding debt of the Company, compounded semiannually) of the obligation of the lessee for rental payments during the remaining term of the lease included in such transaction, including any period for which such lease has been extended or may, at the option of the lessor, be extended or, if earlier, until the earliest date on which the lessee may terminate such lease upon payment of a penalty (in which case the obligation of the lessee for rental payments shall include such penalty), after excluding all amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water and utility rates and similar charges.

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“ Change of Control ” means:

(1) any sale, lease or other transfer (in one transaction or a series of transactions) of all or substantially all of the consolidated assets of the Company and its Subsidiaries to any Person (other than a Subsidiary of the Company); provided , however , that a transaction where the holders of all classes of Voting Stock of the Company immediately prior to such transaction own, directly or indirectly, Voting Stock representing more than 50% of the voting power of all Voting Stock of such Person immediately after such transaction shall not be a Change of Control;

(2) a “person” or “group” (within the meaning of Section 13(d) of the Exchange Act (other than (x) the Company or (y) Donald R. Horton, Terrill J. Horton, or their respective wives, children, grandchildren and other descendants, or any trust or other entity formed or controlled by any of such individuals (each an “ Excluded Person ”))) publicly discloses, including, without limitation, by filing a Schedule 13D or Schedule TO, or the Company or any of its Subsidiaries publicly discloses, including without limitation, by filing any other schedule, form or report under the Exchange Act (including, without limitation, a Current Report on Form 8-K), facts indicating that such person or group has become the ultimate “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of Voting Stock of the Company representing more than 50% of the voting power of the Voting Stock of the Company; or

(3) the stockholders of the Company approve any plan or proposal for the liquidation or dissolution of the Company; provided , however , that a liquidation or dissolution of the Company that is part of a transaction that does not constitute a Change of Control under the proviso contained in clause (1) above shall not constitute a Change of Control.

Any person or group whose acquisition of beneficial ownership constitutes a Change of Control under clause (2) of the foregoing definition in respect of which a Change of Control Offer is made in accordance with the requirements of the Base Indenture will thereafter, together with its Affiliates, constitute an additional Excluded Person.

“ Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Ratings Downgrade Event.

“ Comparable Treasury Issue ” means the United States Treasury security selected by at least two Reference Treasury Dealers as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.

“ Comparable Treasury Price ” means, with respect to any redemption date, (a) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount, on the third business day preceding such redemption date, as set forth in the daily statistical release (or any successor release) published by the Federal Reserve Bank of New York and designated “Composite 3:30 p.m. Quotations for U.S. Government Securities” or (b) if such release (or any successor release) is not published or does not contain such price on such business day, (i) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

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“ Consolidated Adjusted Tangible Assets ” of the Company as of any date means the Consolidated Tangible Assets of the Company and the Guarantors at the end of the fiscal quarter immediately preceding such date less (a) the book value of any assets securing any Non-Recourse Indebtedness, and (b) all short term liabilities of the Company and the Guarantors, except for liabilities payable by their terms more than one year from the date of determination (or renewable or extendible at the option of the obligor to a maturity date more than one year after such date) and liabilities in respect of retiree benefits other than persons for which the Company or the Guarantors are required to accrue pursuant to Accounting Standards Codification 715-60 (or any successor provision), in each case as determined in accordance with GAAP.

“ Consolidated Tangible Assets ” of the Company as of any date means the book value of the total assets of the Company and the Guarantors (less applicable reserves) on a consolidated basis at the end of the fiscal quarter immediately preceding such date, less: (i) Intangible Assets and (ii) appropriate adjustments on account of minority interests of other Persons holding equity investments in Guarantors, in each case as determined in accordance with GAAP.

“ Fitch ” means Fitch Ratings.

“ GAAP ” means generally accepted accounting principles set forth in the accounting standards codification of the Financial Accounting Standards Board or in such other statements by such or any other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date.

“ Guarantors ” means (i) initially, each of:

C. Richard Dobson Builders, Inc., a Virginia corporation;

CH Investments of Texas, Inc., a Delaware corporation;

CHI Construction Company, an Arizona corporation;

CHTEX of Texas, Inc., a Delaware corporation;

Continental Homes, Inc., a Delaware corporation;

Continental Homes of Texas, L.P., a Texas limited partnership;

Continental Residential, Inc., a California corporation;

D.R. Horton— Emerald, Ltd., a Texas limited partnership;

D.R. Horton— Schuler Homes, LLC, a Delaware limited liability company;

D.R. Horton— Texas, Ltd., a Texas limited partnership;

D.R. Horton, Inc.— Birmingham, an Alabama corporation;

D.R. Horton, Inc.— Chicago, a Delaware corporation;

D.R. Horton, Inc.— Dietz-Crane, a Delaware corporation;

D.R. Horton, Inc.— Fresno, a Delaware corporation;

D.R. Horton, Inc.— Greensboro, a Delaware corporation;

D.R. Horton, Inc.— Gulf Coast (f/k/a DRH Regrem V, Inc.), a Delaware corporation;

D.R. Horton, Inc.—Huntsville (f/k/a DRH Regrem XIII, Inc.), a Delaware corporation;

D.R. Horton, Inc.— Jacksonville, a Delaware corporation;

D.R. Horton, Inc.— Louisville, a Delaware corporation;

D.R. Horton, Inc.— Minnesota, a Delaware corporation;

D.R. Horton, Inc.— New Jersey, a Delaware corporation;

D.R. Horton, Inc.— Portland, a Delaware corporation;

D.R. Horton, Inc.— Sacramento, a California corporation;

D.R. Horton, Inc.— Torrey, a Delaware corporation;

D.R. Horton LA North, Inc. (f/k/a DRH Regrem X, Inc.), a Delaware corporation;

D.R. Horton BAY, Inc. (f/k/a D.R. Horton OCI, Inc., D.R. Horton Orange County Inc. and DRH Regrem IX, Inc.), a Delaware corporation;

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D.R. Horton Cruces Construction, Inc. (f/k/a DRH Regrem XI, Inc.), a Delaware corporation;

D.R. Horton Los Angeles Holding Company, Inc., a California corporation;

D.R. Horton Management Company, Ltd., a Texas limited partnership;

D.R. Horton Materials, Inc., a Delaware corporation;

D.R. Horton VEN Inc. (f/k/a D.R. LAV Inc. and D.R. Horton San Diego Holding Company, Inc.), a California corporation;

DRH Cambridge Homes, Inc., a California corporation;

DRH Cambridge Homes, LLC, a Delaware limited liability company;

DRH Construction, Inc., a Delaware corporation;

DRH Regrem VII, LP, a Texas limited partnership;

DRH Regrem VIII, LLC, a Delaware limited liability company;

DRH Regrem XII, LP, a Texas limited partnership;

DRH Regrem XIV, Inc., a Delaware corporation;

DRH Regrem XV, Inc., a Delaware corporation;

DRH Regrem XVI, Inc., a Delaware corporation;

DRH Regrem XVII, Inc., a Delaware corporation;

DRH Regrem XVIII, Inc., a Delaware corporation;

DRH Regrem XIX, Inc., a Delaware corporation;

DRH Regrem XX, Inc., a Delaware corporation;

DRH Regrem XXI, Inc., a Delaware corporation;

DRH Regrem XXII, Inc., a Delaware corporation;

DRH Regrem XXIII, Inc., a Delaware corporation;

DRH Regrem XXIV, Inc., a Delaware corporation;

DRH Regrem XXV, Inc. (f/k/a D.R. Horton VEN, Inc. and D.R. Horton Inc. – Los Angeles), a Delaware corporation;

DRH Southwest Construction, Inc., a California corporation;

DRH Tucson Construction, Inc., a Delaware corporation;

HPH Homebuilders 2000 L.P., a California limited partnership;

KDB Homes, Inc., a Delaware corporation;

Meadows I, Ltd., a Delaware corporation;

Meadows II, Ltd., a Delaware corporation;

Meadows VIII, Ltd., a Delaware corporation;

Meadows IX, Inc., a New Jersey corporation;

Meadows X, Inc., a New Jersey corporation;

Melmort Co., a Colorado corporation;

Melody Homes, Inc., a Delaware corporation;

Schuler Homes of Arizona, LLC, a Delaware limited liability company;

Schuler Homes of California, Inc., a California corporation;

Schuler Homes of Oregon, Inc., an Oregon corporation;

Schuler Homes of Washington, Inc., a Washington corporation;

Schuler Mortgage, Inc., a Delaware corporation;

Schuler Realty Hawaii, Inc., a Hawaii corporation;

SGS Communities at Grande Quay, L.L.C., a New Jersey limited liability company;

SHA Construction LLC, a Delaware limited liability company;

SHLR of California, Inc., a California corporation;

SHLR of Colorado, Inc., a Colorado corporation;

SHLR of Nevada, Inc., a Nevada corporation;

SHLR of Utah, Inc., a Utah corporation;

SHLR of Washington, Inc., a Washington corporation;

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SRHI LLC, a Delaware limited liability company;

SSHI LLC, a Delaware limited liability company;

Vertical Construction Corporation, a Delaware corporation;

Western Pacific Funding, Inc., a California corporation;

Western Pacific Housing— Antigua, LLC, a Delaware limited liability company;

Western Pacific Housing— Aviara, L.P., a California limited partnership;

Western Pacific Housing— Boardwalk, LLC, a Delaware limited liability company;

Western Pacific Housing— Broadway, LLC, a Delaware limited liability company;

Western Pacific Housing— Canyon Park, LLC, a Delaware limited liability company;

Western Pacific Housing— Carmel, LLC, a Delaware limited liability company;

Western Pacific Housing— Carrillo, LLC, a Delaware limited liability company;

Western Pacific Housing— Communications Hill, LLC, a Delaware limited liability company;

Western Pacific Housing— Copper Canyon, LLC, a Delaware limited liability company;

Western Pacific Housing— Creekside, LLC, a Delaware limited liability company;

Western Pacific Housing— Culver City, L.P., a California limited partnership;

Western Pacific Housing— Del Valle, LLC, a Delaware limited liability company;

Western Pacific Housing— Lomas Verdes, LLC, a Delaware limited liability company;

Western Pacific Housing— Lost Hills Park, LLC, a Delaware limited liability company;

Western Pacific Housing— McGonigle Canyon, LLC, a Delaware limited liability company;

Western Pacific Housing— Mountaingate, L.P., a California limited partnership;

Western Pacific Housing— Norco Estates, LLC, a Delaware limited liability company;

Western Pacific Housing— Oso, L.P., a California limited partnership;

Western Pacific Housing— Pacific Park II, LLC, a Delaware limited liability company;

Western Pacific Housing— Park Avenue East, LLC, a Delaware limited liability company;

Western Pacific Housing— Park Avenue West, LLC, a Delaware limited liability company;

Western Pacific Housing— Playa Vista, LLC, a Delaware limited liability company;

Western Pacific Housing— Poinsettia, L.P., a California limited partnership;

Western Pacific Housing— River Ridge, LLC, a Delaware limited liability company;

Western Pacific Housing— Robinhood Ridge, LLC, a Delaware limited liability company;

Western Pacific Housing— Santa Fe, LLC, a Delaware limited liability company;

Western Pacific Housing— Scripps, L.P., a California limited partnership;

Western Pacific Housing— Scripps II, LLC, a Delaware limited liability company;

Western Pacific Housing— Scripps, L.P., a California limited partnership;

Western Pacific Housing— Seacove, L.P., a California limited partnership;

Western Pacific Housing— Studio 528, LLC, a Delaware limited liability company;

Western Pacific Housing— Terra Bay Duets, LLC, a Delaware limited liability company;

Western Pacific Housing— Torrance, LLC, a Delaware limited liability company;

Western Pacific Housing— Torrey Commercial, LLC, a Delaware limited liability company;

Western Pacific Housing— Torrey Meadows, LLC, a Delaware limited liability company;

Western Pacific Housing— Torrey Multi-Family, LLC, a Delaware limited liability company;

Western Pacific Housing— Torrey Village Center, LLC, a Delaware limited liability company;

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Western Pacific Housing— Vineyard Terrace, LLC, a Delaware limited liability company;

Western Pacific Housing— Windemere, LLC, a Delaware limited liability company;

Western Pacific Housing— Windflower, L.P., a California limited partnership;

Western Pacific Housing, Inc., a Delaware corporation;

Western Pacific Housing, L.P. (f/k/a Western Pacific Housing Co.), a California limited partnership;

Western Pacific Housing Management, Inc., a California corporation;

WPH— Camino Ruiz, LLC, a Delaware limited liability company;

and (ii) each of the Company’s Subsidiaries that becomes a guarantor of the Notes pursuant to the provisions of the Indenture, in each case until released from its Guarantee pursuant to the provisions of the Indenture.

“ Intangible Assets ” means with respect to the Notes, all unamortized debt discount and expense, unamortized deferred charges, goodwill, patents, trademarks, service marks, trade names, copyrights, write-ups of assets over their prior carrying value (other than write-ups which occurred prior to the Issue Date and other than, in connection with the acquisition of an asset, the write-up of the value of such asset (within one year of its acquisition) to its fair market value in accordance with GAAP) and all other items which would be treated as intangibles on the consolidated balance sheet of the Company and the Guarantors prepared in accordance with GAAP.

“ Investment Grade ” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by Fitch (or its equivalent under any successor rating categories of Fitch); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); and the equivalent investment grade credit rating from any replacement Rating Agency or Rating Agencies selected by the Company.

“ Issue Date ” means, May 1, 2012, the date on which the Notes are originally issued under this Supplemental Indenture.

“ Moody’s ” means Moody’s Investors Service, Inc.

“ Non-Guarantor Subsidiary ” means any Subsidiary of the Company that is not a Guarantor.

“ Permitted Liens ” means any Lien:

(1) incurred or deposits made to secure the performance of tenders, bids, leases, statutory obligations, surety and appeal bonds, development obligations, progress payments, government contracts, utility services, developer’s or other obligations to make on-site or off-site improvements and other obligations of like nature (exclusive of obligations for the payment of borrowed money but including the items referred to in the parenthetical in clause (i)(a) of the definition of “Indebtedness”), in each case incurred in the ordinary course of business of the Company and the Guarantors,

(2) constituting attachment or judgment liens,

(3) securing Non-Recourse Indebtedness of the Company or any Guarantor; provided , that it applies only to the Property financed out of the net proceeds of such Non-Recourse Indebtedness (and any accessions thereto and proceeds thereof),

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(4) securing Purchase Money Indebtedness; provided , that it applies only to the Property acquired, constructed or improved with the proceeds of such Purchase Money Indebtedness (and any accessions thereto and proceeds thereof),

(5) constituting purchase money Liens (including Capitalized Lease Obligations); provided , that it applies only to the Property acquired (and any accessions thereto and proceeds thereof) and the related Indebtedness is incurred within 180 days after the acquisition of such Property,

(6) constituting the right of a lender or lenders to which the Company or a Guarantor may be indebted to offset against, or appropriate and apply to the payment of such, Indebtedness any and all balances, credits, deposits, accounts or money of the Company or a Guarantor with or held by such lender or lenders or its affiliates,

(7) constituting the pledge or deposit of cash or other Property in conjunction with obtaining surety, performance, completion or payment bonds and letters of credit or other similar instruments or providing earnest money obligations, escrows or similar purpose undertakings or indemnifications in the ordinary course of business of the Company and the Guarantors,

(8) incurred in connection with pollution control, industrial revenue, water, sewage or other public improvement bonds or any similar bonds,

(9) statutory Liens of landlords and carriers’, warehousemen’s, mechanics’, suppliers’, materialmen’s, repairmen’s or other Liens imposed by law and arising in the ordinary course of business,

(10) leases or subleases granted to others not materially interfering with the ordinary course of business of the Company and the Guarantors taken as a whole,

(11) Liens securing community development district bonds or similar bonds issued by any governmental authority to accomplish similar purposes,

(12) Liens on assets and properties of joint ventures or limited partnerships that are not wholly-owned Subsidiaries of the Company or any of the Guarantors, and

(13) Liens securing the Company’s or the Guarantors’ obligations to third parties, in connection with joint development agreements with such third parties, to perform and/or pay for or reimburse the costs of construction and/or development related to or benefiting Company’s or the Guarantors’ Property and Property belonging to such third parties.

“ Purchase Money Indebtedness ” means Indebtedness of the Company or any Guarantor incurred for the purpose of financing all or any part of the purchase price, or the cost of construction or improvement, of any Property to be used in the ordinary course of business by the Company and the Guarantors; provided , however , that (i) the aggregate principal amount of such Indebtedness shall not exceed such purchase price or cost and (ii) such Indebtedness shall be incurred no later than 180 days after the acquisition of such Property or completion of such construction or improvement.

“ Rating Agency ” means (1) each of Moody’s, Fitch and S&P; or (2) if any of Moody’s, Fitch or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available (for reasons outside of the Company’s control), a “nationally recognized statistical rating organization” as defined under Section 3(a)(62) of the Exchange Act selected by the Company (as certified by a resolution of the Company’s Board of Directors) as a replacement Rating Agency for Moody’s, Fitch or S&P, or all three, as the case may be.

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“ Ratings Downgrade Event ” means the rating on the Notes is lowered independently by each of the Rating Agencies and the Notes are rated below Investment Grade by all three Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Ratings Downgrade Event otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Ratings Downgrade Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the trustee in writing at the Company’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Ratings Downgrade Event).

“ Reference Treasury Dealers ” means (a) Citigroup Global Markets Inc., J.P. Morgan Securities LLC and UBS Securities LLC (or any of their respective affiliates which are Primary Treasury Dealers), and their respective successors; provided , however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in the United States of America (a “ Primary Treasury Dealer ”), the Company will substitute therefor another Primary Treasury Dealer, and (b) any other Primary Treasury Dealer(s) selected by the Company.

“ Reference Treasury Dealer Quotations ” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the third business day preceding such redemption date.

“ Remaining Scheduled Payments ” means, with respect to any Note, the remaining scheduled payments of the principal thereof to be redeemed and interest thereon that would be due after the related redemption date but for such redemption; providedhowever that if such redemption date is not an interest payment date with respect to such Note, the amount of the next succeeding scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to the date of such redemption.

“ S&P ” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

“ Sale and Leaseback Transaction ” means a sale or transfer made by the Company or a Guarantor of any Property which is either (a) a manufacturing facility, project club house, amenity center and common area, office building, warehouse or distribution facility whose book value equals or exceeds 1% of Consolidated Adjusted Tangible Assets as of the date of determination or (b) another Property which exceeds 5% of Consolidated Adjusted Tangible Assets as of the date of determination, if such sale or transfer is made with the agreement, commitment or intention of leasing such Property to the Company or a Guarantor, provided that “Sale and Leaseback Transaction” shall not include (1) a sale-leaseback transaction relating to a Property entered into within 180 days after the later of (i) the date of acquisition of such Property by the Company or a Guarantor and (ii) the date of the completion of construction or commencement of full operations on such Property, whichever is later, (2) a sale-leaseback transaction which has a lease of no more than three years in length or (3) a sale or transfer made to the Company or another Guarantor.

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“ Secured Debt ” means any Indebtedness of the Company or any Guarantor which is secured by (a) a Lien in any Property of the Company or a Guarantor (other than property excluded in clause (b) ) or (b) a Lien on Capital Stock owned directly or indirectly by the Company or a Guarantor in a corporation or other entity (other than a Non-Guarantor Subsidiary) or in the rights of the Company or a Guarantor in respect of Indebtedness of a corporation or other entity (other than a Non-Guarantor Subsidiary) in which the Company or a Guarantor owns Capital Stock. The securing in the foregoing manner of any such Indebtedness which immediately prior thereto was not Secured Debt shall be deemed to be the creation of Secured Debt at the time security is given.

“ Treasury Rate ” means, with respect to any redemption date, the rate per annum equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

“ Voting Stock ” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.

ARTICLE THREE

Covenants

Section 3.01. Limitations on Secured Debt .

The Company will not, and will not cause or permit any Guarantor to, create, incur, assume or guarantee any Secured Debt unless the Notes are secured equally and ratably with (or prior to) such Secured Debt, provided that the foregoing does not prohibit the creation, incurrence, assumption or guarantee of:

(1) Secured Debt which is secured by Liens on model homes, homes held for sale, homes that are under construction or under contract for sale, contracts for the sale of homes, land (improved or unimproved), contracts for the sale of land, project club houses, amenity centers and common areas, manufacturing plants, warehouses, distribution facilities or office buildings, and fixtures and equipment located at or on any of the foregoing or leasehold or other interests in any of the foregoing;

(2) Secured Debt which is secured by a Lien on Property at the time of its acquisition by the Company or a Guarantor, which Lien secures obligations assumed by the Company or a Guarantor, or on the Property of a corporation or other entity at the time it is merged into or consolidated with the Company or a Guarantor or becomes a Guarantor as a result of the acquisition of its Capital Stock by the Company or a Guarantor (other than Secured Debt created in contemplation of the acquisition of such Property or the consummation of such a merger or consolidation or acquisition where the Lien attaches to or affects the Property of the Company or a Guarantor prior to such transaction);

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(3) Secured Debt which is secured by Liens arising from conditional sales agreements or title retention agreements with respect to Property acquired by the Company or a Guarantor;

(4) Secured Debt which is secured by Liens securing Indebtedness of a Guarantor owing to the Company or to another Guarantor;

(5) Indebtedness secured by a Permitted Lien; and

(6) any amendment, restatement, supplement, renewal, replacement, extension, refinancing or refunding, in whole or in part (“ Refinanced Debt ”), of Secured Debt that was permitted to be created, incurred, assumed or guaranteed pursuant to clauses (1) through (5) above at the time of the original creation, incurrence, assumption or guarantee thereof, or by this clause (6) , provided in each case that the principal amount of the Refinanced Debt does not exceed the principal amount of the Secured Debt being refinanced, extended, renewed or replaced (plus accrued interest thereon and expenses of refinancing, extension, renewal or replacement) and such Refinanced Debt is not secured by any additional Properties of the Company or any Guarantor (other than accessions and proceeds).

In addition, the Company and the Guarantors may create, incur, assume or guarantee Secured Debt, without equally or ratably (or on a senior basis) securing the Notes, if immediately thereafter the sum of (1) the aggregate principal amount (or the accreted value thereof, in the case of any Secured Debt issued with original issue discount) of all Secured Debt outstanding (excluding Secured Debt permitted under clauses (1) through (6) above and any Secured Debt in relation to which the Notes have been secured equally and ratably (or on a senior basis)) and (2) all Attributable Debt in respect of Sale and Leaseback Transactions (excluding Attributable Debt in respect of Sale and Leaseback Transactions satisfying the conditions set forth in clauses (1) and (2) and if the 365 day period referenced therein shall have expired, also clause (3) under Section 3.02 ) as of the date of determination would not exceed 20% of Consolidated Adjusted Tangible Assets.

Section 3.02. Restrictions on Sale and Leaseback Transactions .

The Company will not, and will not cause or permit any Guarantor to, enter into any Sale and Leaseback Transaction, unless:

(1) notice is promptly given to the Trustee of the Sale and Leaseback Transaction;

(2) fair value is received by the Company or a Guarantor for the Property sold (as determined in good faith pursuant to a resolution of the Board of Directors delivered to the Trustee); and

(3) the Company or a Guarantor, within 365 days after the completion of the Sale and Leaseback Transaction, applies an amount equal to the net proceeds therefrom either:

(A) to the redemption, repayment or retirement of the Notes and the Securities of all other Series under the Base Indenture (other than a Series that, pursuant to the applicable supplemental indenture or Authorizing Resolution, does not have the benefit of this Section or its equivalent), including the cancellation by the Trustee of any Securities of any such Series delivered by the Company to the Trustee, or any other Indebtedness of the Company or any Guarantor (other than Indebtedness which by its terms or the terms of the instrument by which it was issued is subordinate in right of payment to the Notes or any such other Series), or

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(B) to the purchase by the Company or a Guarantor of Property substantially similar to the Property sold or transferred.

Without regard to the foregoing, the Company and the Guarantors may enter into a Sale and Leaseback Transaction if immediately thereafter the sum of (1) the aggregate principal amount of all Secured Debt outstanding (excluding Secured Debt permitted under clauses (1) through (6) of the first paragraph of Section 3.01 above or Secured Debt in relation to which the Notes have been secured equally and ratably (or on a senior basis)) and (2) all Attributable Debt in respect of Sale and Leaseback Transactions (excluding Attributable Debt in respect of Sale and Leaseback Transactions satisfying the conditions set forth in clauses (1) and (2) and if the 365 day period referenced therein shall have expired, also clause (3) above) as of the date of determination would not exceed 20% of Consolidated Adjusted Tangible Assets.

Section 3.03. Offer to Purchase upon Change of Control Triggering Event .

(1) In the event that there shall occur a Change of Control Triggering Event, except as otherwise provided in Section 3.03(6) hereof, the Company shall make an offer to each Holder of the Notes (the “ Change of Control Offer ”) to purchase all or any part of such Holder’s Notes at 101% of the principal amount thereof plus accrued and unpaid interest to the date of purchase (the “ Change of Control Purchase Price ”) in accordance with the procedures set forth in this Section 3.03 .

(2) On or before the thirtieth day after any Change of Control Triggering Event, or, at the Company’s option, prior to any Change of Control, but after the public announcement of the Change of Control, the Company shall be obligated to make the Change of Control Offer by mailing, or causing to be mailed, to all Holders of Notes, with a copy to the Trustee, a notice regarding the Change of Control Triggering Event and the Change of Control Offer. The notice shall state the payment date for the repurchase of the Notes, which date shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed. The notice may, if mailed prior to the date of consummation of the Change of Control, also state that the offer to purchase is conditioned on a Change of Control Triggering Event occurring on or prior to the payment date specified in the notice.

(3) On the payment date of the Change of Control Purchase Price as specified in the notice, the Company shall, to the extent lawful:

(A) accept for payment all Notes or portions of Notes properly tendered and not withdrawn pursuant to the Change of Control Offer;

(B) deposit with the Paying Agent an amount equal to the Change of Control Purchase Price in respect of all Notes or portions of Notes properly tendered and not withdrawn pursuant to the Change of Control Offer; and

(C) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company.

(4) The Paying Agent shall promptly mail to each Holder of Notes properly tendered pursuant to the Change of Control Offer, the Change of Control Purchase Price for such Notes, and the Trustee shall promptly authenticate and mail, or cause to be transferred by book entry, to each such Holder

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a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that the new Note shall be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. The Company shall publicly announce the results of the Change of Control Offer on or as soon as reasonably practicable after the payment date of the Change of Control Purchase Price.

(5) The Company will comply with applicable law, including Section 14(e) of the Exchange Act and Rule 14e-1 thereunder, and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the purchase of the Notes as a result of a Change of Control Triggering Event. To the extent that the provisions of any securities laws or regulations conflict with this Section 3.03, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section 3.03 by virtue of such conflict.

(6) The Company will not be required to make a Change of Control Offer after a Change of Control Triggering Event if (a) a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company and such third party purchases all Notes properly tendered and not withdrawn under its offer, (b) the Company has given notice to redeem all Notes in accordance with paragraph 4 of the Notes and Article Three of the Base Indenture, unless and until there is a default in payment of the applicable redemption price or (c) in connection with or in contemplation of any Change of Control for which a definitive agreement is in place, the Company or a third party has made an offer to purchase (an “ Alternate Offer ”) any and all Notes properly tendered at a cash price equal to or higher than the Change of Control Purchase Price and has purchased all Notes properly tendered and not withdrawn in accordance with the terms of such Alternate Offer.

(7) None of the provisions relating to a repurchase upon a Change of Control Triggering Event shall be waivable by the Board of Directors of the Company.

ARTICLE FOUR

Miscellaneous

Section 4.01. Governing Law .

THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS SUPPLEMENTAL INDENTURE, THE NOTES AND THE GUARANTEES.

Section 4.02. No Adverse Interpretation of Other Agreements .

This Supplemental Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Supplemental Indenture.

Section 4.03. No Recourse Against Others .

All liability (i) described in Paragraph 11 of the Notes, of any director, officer, employee or stockholder, as such, of the Company and (ii) described in the second paragraph of the guarantees of each Guarantor, of any stockholder, officer, director, employee, incorporator, partner, member or manager, as such, of any Guarantor, is waived and released.

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Section 4.04. Successors and Assigns .

All covenants and agreements of the Company and the Guarantors in this Supplemental Indenture and the Notes shall bind its successors and assigns. All agreements of the Trustee in this Supplemental Indenture shall bind its successors and assigns.

Section 4.05. Duplicate Originals .

The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

Section 4.06. Severability .

In case any one or more of the provisions contained in this Supplemental Indenture or in the Notes shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Supplemental Indenture or of the Notes.

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SIGNATURES

IN WITNESS WHEREOF, the parties have caused this Supplemental Indenture to be duly executed, all as of the date first above written.


D.R. HORTON, INC.

By:
		Bill W. Wheat
		Executive Vice President and
		Chief Financial Officer

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GUARANTORS:

C. RICHARD DOBSON BUILDERS, INC.

CH INVESTMENTS OF TEXAS, INC.

CHI CONSTRUCTION COMPANY

CHTEX OF TEXAS, INC.

CONTINENTAL HOMES, INC.

CONTINENTAL RESIDENTIAL, INC.

D.R. HORTON BAY, INC.

D.R. HORTON CRUCES CONSTRUCTION, INC.

D.R. HORTON, INC. – BIRMINGHAM

D.R. HORTON, INC. – CHICAGO

D.R. HORTON, INC. – DIETZ-CRANE

D.R. HORTON, INC. – FRESNO

D.R. HORTON, INC. – GREENSBORO

D.R. HORTON, INC. – GULF COAST

D.R. HORTON, INC. – HUNTSVILLE

D.R. HORTON, INC. – JACKSONVILLE

D.R. HORTON, INC. – LOUISVILLE

D.R. HORTON, INC. – MINNESOTA

D.R. HORTON, INC. – NEW JERSEY

D.R. HORTON, INC. – PORTLAND

D.R. HORTON, INC. – SACRAMENTO

D.R. HORTON, INC. – TORREY

D.R. HORTON LA NORTH, INC.

D.R. HORTON LOS ANGELES HOLDING COMPANY, INC.

D.R. HORTON MATERIALS, INC.

D.R. HORTON VEN, INC.

DRH CAMBRIDGE HOMES, INC.

DRH CONSTRUCTION, INC.

DRH REGREM XIV, INC.

DRH REGREM XV, INC.

DRH REGREM XVI, INC.

DRH REGREM XVII, INC.

DRH REGREM XVIII, INC.

DRH REGREM XIX, INC.

DRH REGREM XX, INC.

DRH REGREM XXI, INC.

DRH REGREM XXII, INC.

DRH REGREM XXIII, INC.

DRH REGREM XXIV, INC.

DRH REGREM XXV, INC.

DRH SOUTHWEST CONSTRUCTION, INC.

DRH TUCSON CONSTRUCTION, INC.

KDB HOMES, INC.

MEADOWS I, LTD.

MEADOWS II, LTD.

MEADOWS VIII, LTD.

MEADOWS IX, INC.

MEADOWS X, INC.

MELMORT CO.

MELODY HOMES, INC.

SCHULER HOMES OF CALIFORNIA, INC.

SCHULER HOMES OF OREGON, INC.

SCHULER HOMES OF WASHINGTON, INC.

SCHULER MORTGAGE, INC.

SCHULER REALTY HAWAII, INC.

SHLR OF CALIFORNIA, INC.

SHLR OF COLORADO, INC.

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SHLR OF NEVADA, INC.

SHLR OF UTAH, INC.

SHLR OF WASHINGTON, INC.

VERTICAL CONSTRUCTION CORPORATION

WESTERN PACIFIC FUNDING, INC.

WESTERN PACIFIC HOUSING, INC.

WESTERN PACIFIC HOUSING MANAGEMENT, INC.


By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

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CONTINENTAL HOMES OF TEXAS, L.P.

By:	CHTEX of Texas, Inc., its General Partner

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

D.R. HORTON MANAGEMENT COMPANY, LTD. D.R. HORTON - EMERALD, LTD. D.R. HORTON - TEXAS, LTD. DRH REGREM VII, LP DRH REGREM XII, LP


By:	Meadows I, Ltd., its General Partner

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer


SGS COMMUNITIES AT GRANDE QUAY, L.L.C.

By:	Meadows IX, Inc., a Member

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

and


By:	Meadows X, Inc., a Member

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer


DRH CAMBRIDGE HOMES, LLC DRH REGREM VIII, LLC

By:	D.R. Horton, Inc. - Chicago, its Member

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

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HPH HOMEBUILDERS 2000 L.P.

WESTERN PACIFIC HOUSING, L.P.

WESTERN PACIFIC HOUSING-ANTIGUA, LLC

WESTERN PACIFIC HOUSING-AVIARA, L.P.

WESTERN PACIFIC HOUSING-BOARDWALK, LLC

WESTERN PACIFIC HOUSING-BROADWAY, LLC

WESTERN PACIFIC HOUSING-CANYON PARK, LLC

WESTERN PACIFIC HOUSING-CARMEL, LLC

WESTERN PACIFIC HOUSING-CARRILLO, LLC

WESTERN PACIFIC HOUSING-COMMUNICATIONS HILL, LLC

WESTERN PACIFIC HOUSING-COPPER CANYON, LLC

WESTERN PACIFIC HOUSING-CREEKSIDE, LLC

WESTERN PACIFIC HOUSING-CULVER CITY, L.P.

WESTERN PACIFIC HOUSING-DEL VALLE, LLC

WESTERN PACIFIC HOUSING-LOMAS VERDES, LLC

WESTERN PACIFIC HOUSING-LOST HILLS PARK, LLC

WESTERN PACIFIC HOUSING-MCGONIGLE CANYON, LLC

WESTERN PACIFIC HOUSING-MOUNTAINGATE, L.P.

WESTERN PACIFIC HOUSING-NORCO ESTATES, LLC

WESTERN PACIFIC HOUSING-OSO, L.P.

WESTERN PACIFIC HOUSING-PACIFIC PARK II, LLC

WESTERN PACIFIC HOUSING-PARK AVENUE EAST, LLC

WESTERN PACIFIC HOUSING-PARK AVENUE WEST, LLC

WESTERN PACIFIC HOUSING-PLAYA VISTA, LLC

WESTERN PACIFIC HOUSING-POINSETTIA, L.P.

WESTERN PACIFIC HOUSING-RIVER RIDGE, LLC

WESTERN PACIFIC HOUSING-ROBINHOOD RIDGE, LLC

WESTERN PACIFIC HOUSING-SANTA FE, LLC

WESTERN PACIFIC HOUSING-SCRIPPS, L.P.

WESTERN PACIFIC HOUSING-SCRIPPS II, LLC

WESTERN PACIFIC HOUSING-SEACOVE, L.P.

WESTERN PACIFIC HOUSING-STUDIO 528, LLC

WESTERN PACIFIC HOUSING-TERRA BAY DUETS, LLC

WESTERN PACIFIC HOUSING-TORRANCE, LLC

WESTERN PACIFIC HOUSING-TORREY COMMERCIAL, LLC

WESTERN PACIFIC HOUSING-TORREY MEADOWS, LLC

WESTERN PACIFIC HOUSING-TORREY MULTI-FAMILY, LLC

WESTERN PACIFIC HOUSING-TORREY VILLAGE CENTER, LLC

WESTERN PACIFIC HOUSING-VINEYARD TERRACE, LLC

WESTERN PACIFIC HOUSING-WINDEMERE, LLC

WESTERN PACIFIC HOUSING-WINDFLOWER, L.P.

WPH-CAMINO RUIZ, LLC


By:	Western Pacific Housing Management, Inc., its Manager, Member or General Partner

	By:
		Bill W. Wheat
		Executive Vice President and Chief Financial Officer

S-2


SCHULER HOMES OF ARIZONA LLC SHA CONSTRUCTION LLC

	By:	SRHI LLC,
		its Member

			By:	SHLR of Nevada, Inc.
				its Member

				By:
					Bill W. Wheat
					Executive Vice President and Chief Financial Officer


D.R. HORTON-SCHULER HOMES, LLC

	By:	Vertical Construction Corporation, its Manager

			By:
				Bill W. Wheat
				Executive Vice President and Chief Financial Officer


SRHI LLC

	By:	SHLR of Nevada, Inc., its Member

			By:
				Bill W. Wheat
				Executive Vice President and Chief Financial Officer


SSHI LLC

	By:	SHLR of Washington, Inc., its Member

			By:
				Bill W. Wheat
				Executive Vice President and Chief Financial Officer

S-3


AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC , as Trustee

By:

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EXHIBIT A

[FORM OF FACE OF SECURITY]

[Global Security Legend]

THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE HOLDERS OF BENEFICIAL INTERESTS HEREIN, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE ANY SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06 OF THE BASE INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR TO ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF ANY ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO SUCH ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.

A-1


No.		CUSIP No.:
		ISIN No.:

4.750% SENIOR NOTES DUE 2017

D.R. HORTON, INC.

a Delaware corporation

promises to pay to Cede & Co. or registered assigns the principal sum of Three Hundred Fifty Million Dollars on May 15, 2017.

Interest Payment Dates: May 15 and November 15

Record Dates: May 1 and November 1


Dated:

D.R. HORTON, INC.

By:
		Title:

By:
		Title:

Authenticated:


American Stock Transfer & Trust Company, LLC, as Trustee, certifies that this is one of the Securities referred to in the within mentioned Indenture.

By:
		Authorized Signatory

A-2

[FORM OF REVERSE SIDE OF SECURITY]

D.R. HORTON, INC.

4.750% SENIOR NOTES DUE 2017

D.R. HORTON, INC., a Delaware corporation (together with its successors and assigns, the “ Company ”), issued this Security under an Indenture dated as of May 1, 2012 (as amended, modified or supplemented from time to time in accordance therewith, the “ Base Indenture ”), as supplemented by the Supplemental Indenture dated as of May 1, 2012 (the “ Supplemental Indenture ” and together with the Base Indenture, the “ Indenture ”), by and among the Company, the Guarantors party thereto and American Stock Transfer & Trust Company, LLC, as trustee (in such capacity, the “ Trustee ”), to which reference is hereby made for a statement of the respective rights, obligations, duties and immunities thereunder of the Company, the Trustee and the Holders and of the terms upon which the Securities are, and are to be, authorized and delivered. All terms used in this Security that are defined in the Indenture shall have the meanings assigned to them therein.

1.	Interest.

The Company promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest semiannually on May 15 and November 15 of each year, commencing November 15, 2012, until the principal is paid or made available for payment. Interest on the Securities will accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid, from May 1, 2012, provided that, if there is no existing default in the payment of interest, and if this Security is authenticated between a record date referred to on the face hereof and the next succeeding interest payment date, interest shall accrue from such interest payment date. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2.	Method of Payment.

The Company will pay interest on the Securities (except defaulted interest, if any, which will be paid on such special payment date to Holders of record on such special record date as may be fixed by the Company) to the persons who are registered Holders of Securities at the close of business on May 1 or November 1, as the case may be, immediately preceding the applicable interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.

3.	Paying Agent and Registrar.

4.	Optional Redemption.

The Company may redeem the Securities at any time or from time to time, in whole or in part, at a redemption price equal to the greater of the following amounts: (i) 100% of their principal amount; and (ii) the present value of the Remaining Scheduled Payments on the Securities being redeemed on the redemption date, discounted to the redemption date, on a semiannual basis, at the Treasury Rate plus 50 basis points (0.50%), plus, in each case, accrued and unpaid interest on such Securities to the redemption date. In determining the redemption price and accrued interest, interest shall be calculated on the basis of a 360-day year consisting of twelve 30-day months.

A-3

Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at its registered address. Securities in denominations larger than $2,000 may be redeemed in part. On and after the redemption date interest ceases to accrue on Securities or portions of them called for redemption, provided that if the Company shall default in the payment of such Securities at the redemption price together with accrued interest, interest shall continue to accrue at the rate borne by the Securities.

5.	Denominations, Transfer, Exchange.

The Securities are in registered form only without coupons in denominations of $2,000 and integral multiples of $1,000 in excess thereof. A Holder may transfer or exchange Securities by presentation of such Securities to the Registrar or a co-Registrar with a request to register the transfer or to exchange them for an equal principal amount of Securities of other denominations. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not transfer or exchange any Security selected for redemption or purchase, except the unredeemed or unpurchased part thereof if the Security is redeemed or purchased in part, or transfer or exchange any Securities for a period of 15 days before a selection of Securities to be redeemed or purchased.

6.	Persons Deemed Owners.

The registered Holder of this Security shall be treated as the owner of it for all purposes.

7.	Unclaimed Money.

8.	Amendment, Supplement, Waiver.

Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the outstanding Securities of each Series affected by the amendment and any past default or compliance with any provision relating to any Series of the Securities may be waived in a particular instance with the consent of the Holders of a majority in principal amount of the outstanding Securities of such Series. Without the consent of any Securityholder, the Company and the Trustee may amend or supplement the Indenture or the Securities in certain respects as specified in the Indenture.

9.	Successor.

When a successor assumes all the obligations of its predecessor under the Securities and the Indenture, the predecessor will be released from those obligations.

A-4

10.

Trustee Dealings With Company.

11.

No Recourse Against Others.

12.

Discharge of Indenture.

The Indenture contains certain provisions pertaining to defeasance and discharge, which provisions shall for all purposes have the same effect as if set forth herein.

13.

Authentication.

This Security shall not be valid until an authorized signatory of the Trustee signs the certificate of authentication on the other side of this Security.

14.

Abbreviations.

15.

GOVERNING LAW.

THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

16.

CUSIP and ISIN Numbers.

17.

Copies.

A-5

18.

Change of Control Triggering Event.

In the event that there shall occur a Change of Control Triggering Event, except as otherwise provided in the Indenture, the Company shall make an offer to each Holder of the Securities to purchase all or any part of such Holder’s Securities at 101% of the principal amount thereof plus accrued and unpaid interest to the date of purchase in accordance with the procedures set forth in the Indenture.

19.

Defaults and Remedies.

The Events of Default relating to the Securities are defined in Article Six of the Base Indenture as modified by the Supplemental Indenture. Upon the occurrence of an Event of Default, the rights and obligations of the Company and the Holders shall be as set forth in the Indenture.

A-6

ASSIGNMENT FORM

If you the Holder want to assign this Security, fill in the form below:

I or we assign and transfer this Security to

(Insert assignee’s social security or tax ID number)

(Print or type assignee’s name, address, and zip code)

and irrevocably appoint

agent to transfer this Security on the books of the Company. The agent may substitute another to act for him.

Date:

Your signature:

(Sign exactly as your name appears on the other side of this Security)

Signature Guarantee:

A-7

EXHIBIT B

[FORM OF NOTATION ON SECURITY OF GUARANTEE]

GUARANTEE

The undersigned (the “ Guarantors ”) have unconditionally guaranteed, jointly and severally (such guarantee by each Guarantor being referred to herein as the “ Guarantee ”) (i) the due and punctual payment of the principal of and interest on this Security, whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and interest, if any, on this Security, to the extent lawful, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth in Article Nine of the Base Indenture and (ii) in case of any extension of time of payment or renewal of this Security or any of such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.

THE GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


[Signature of Guarantor(s)]

By:
Name:
Title:



By:
Name:
Title

B-1

Exhibit 5.1

May 1, 2012

D.R. Horton, Inc.

301 Commerce Street

Suite 500

Fort Worth, Texas 76102

Re:	D.R. Horton, Inc. Offering of 4.750% Senior Notes due 2017

Registration Statement on Form S-3 (File No. 333-162123)

Ladies and Gentlemen:

I am Vice President and Assistant Secretary of D.R. Horton, Inc., a Delaware corporation (the “ Company ”). The Company and certain direct and indirect wholly-owned subsidiaries of the Company (collectively, the “ Guarantors ”) have filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “ Securities Act ”) a Registration Statement on Form S-3, File No. 333-162123 (the “ Registration Statement ”), and a prospectus and prospectus supplement with respect thereto, dated September 24, 2009 and April 25, 2012, respectively, in connection with the offering by the Company pursuant thereto of $350,000,000 aggregate principal amount of the Company’s 4.750% Senior Notes due 2017 (the “ Notes ”).

The Notes will be issued under an Indenture, to be dated as of May 1, 2012 (the “ Base Indenture ”), between the Company and American Stock Transfer & Trust Company, as trustee (the “ Trustee ”), as supplemented by the First Supplemental Indenture, to be dated as of May 1, 2012, relating to the Notes (the “ Supplemental Indenture ” and together with the Base Indenture, the “ Indenture ”) between the Company, the Guarantors and the Trustee, and are guaranteed pursuant to the terms of the Indenture and the notation endorsed on the Notes by the Guarantors (the “ Guarantees ”) (the Indenture, the certificates evidencing the notes and the Guarantees are referred to collectively herein as the “ Note Documents ”).

In arriving at the opinions expressed below, I have examined originals, or copies certified or otherwise identified to my satisfaction as being true and complete copies of the originals, of the Base Indenture, the Supplemental Indenture, the Notes and the Guarantees and such other documents, corporate records, certificates of officers of public officials and other instruments as I have deemed necessary or advisable to enable me to render these opinions. In my examination, I have assumed, without independent investigation, the genuineness of all signatures, the legal capacity and competency of all natural persons, the authenticity of all documents submitted to me as originals and the conformity to original documents of all documents submitted to me as copies. As to any facts material to these opinions, I have relied to the extent I have deemed appropriate and without independent investigation upon statements and representations of officers and other representatives of the Company and the guarantors listed on Exhibit A hereto (the “ Specified Guarantors ”) and others.

May 1, 2012

Page 2

Based upon the foregoing, and subject to the assumptions, exceptions, qualifications and limitations set forth herein, I am of the opinion that:

1. Each of the Specified Guarantors is a validly existing corporation or limited liability company in good standing under the laws of its jurisdiction of formation, with all requisite corporate or limited liability company power to execute and deliver the Note Documents to which it is a party and to perform its obligations thereunder.

2. The execution and delivery by the Specified Guarantors of the Note Documents to which it is a party and the performance of its obligations thereunder have been duly authorized by all necessary corporate or limited liability company action.

3. The authorization, execution, delivery and performance of the Note Documents do not and will not violate (a) the charter or bylaws or other constitutive documents of any of the Specified Guarantors, (b) any order, judgment or decree of any court or other agency of government that is binding on any of the Specified Guarantors or (c) any law or regulation currently in effect in the Specified Guarantors’ respective jurisdiction or organization applicable to any of the Specified Guarantors.

4. Each of the Note Documents has been duly executed and delivered by each of the Specified Guarantors.

The opinions expressed above are subject to the following additional exceptions, qualifications, limitations and assumptions:

A. I render no opinion herein as to matters involving the laws of any jurisdiction other than the States of Arizona, Alabama, Hawaii, New Jersey, Nevada, Oregon, Utah, Virginia and Washington. This opinion is limited to the effect of the current state of the laws of the States of Arizona, Alabama, Hawaii, New Jersey, Nevada, Oregon, Utah, Virginia and Washington and the facts as they currently exist. I assume no obligation to revise or supplement this opinion in the event of future changes in such laws or the interpretations thereof or such facts.

May 1, 2012

Page 3

C. I express no opinion regarding the effectiveness of (i) any waiver of stay, extension or usury laws or of unknown future rights, (ii) provisions relating to indemnification, exculpation or contribution, to the extent such provisions may be held unenforceable as contrary to public policy or federal or state securities laws, or (iii) any purported fraudulent transfer “savings” clause.

I consent to the filing of this opinion as an exhibit to the Registration Statement, and further consent to the use of my name under the caption “Legal Matters” in the Registration Statement and the Prospectus Supplement. In giving these consents, I do not thereby admit that I am within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.

Very truly yours,

/s/ Thomas B. Montano

D.R. Horton, Inc.

Thomas B. Montano

Vice President and Assistant Secretary

ANNEX A

Specified Guarantors


Name	Form of Entity	Jurisdiction of Formation
D.R. Horton, Inc.—Birmingham	Corporation	Alabama
CHI Construction Company	Corporation	Arizona
Schuler Realty Hawaii, Inc.	Corporation	Hawaii
SHLR of Nevada, Inc.	Corporation	Nevada
Meadows IX, Inc.	Corporation	New Jersey
Meadows X, Inc.	Corporation	New Jersey
SGS Communities at Grande Quay, L.L.C.	Limited Liability Company	New Jersey
Schuler Homes of Oregon, Inc.	Corporation	Oregon
SHLR of Utah, Inc.	Corporation	Utah
C. Richard Dobson Builders, Inc.	Corporation	Virginia
Schuler Homes of Washington, Inc.	Corporation	Washington
SHLR of Washington, Inc.	Corporation	Washington

Exhibit 5.2

[LETTERHEAD OF GIBSON, DUNN & CRUTCHER LLP]

Client: 39334-00088

May 1, 2012

D.R. Horton, Inc.

301 Commerce Street

Suite 500

Fort Worth, Texas 76102

Re:	D.R. Horton, Inc. Offering of 4.750% Senior Notes due 2017

Registration Statement on Form S-3 (File No. 333-162123)

Ladies and Gentlemen:

We have acted as counsel to D.R. Horton, Inc., a Delaware corporation (the “ Company ”), and certain of its subsidiaries and affiliates listed on Annex A hereto (the “ Guarantors ”) in connection with the preparation and filing with the Securities and Exchange Commission (the “ Commission ”) of a Registration Statement on Form S-3, file no. 333-162123 (the “ Registration Statement ”), under the Securities Act of 1933, as amended (the “ Securities Act ”), the prospectus included therein, the prospectus supplement, dated April 25, 2012, filed with the Commission on April 26, 2012 pursuant to Rule 424(b) of the Securities Act (the “ Prospectus Supplement ”), and the offering by the Company pursuant thereto of $350,000,000 aggregate principal amount of the Company’s 4.750% Senior Notes due 2017 (the “ Notes ”).

The Notes will be issued under an Indenture, to be dated as of May 1, 2012 (the “ Base Indenture ”), between the Company and American Stock Transfer & Trust Company, as trustee (the “ Trustee ”), as supplemented by the First Supplemental Indenture, to be dated as of May 1, 2012, relating to the Notes (the “ Supplemental Indenture ” and together with the Base Indenture, the “ Indenture ”) among the Company, the Guarantors and the Trustee, and are guaranteed pursuant to the terms of the Indenture and the notation endorsed on the Notes by the Guarantors (the “ Guarantees ”). The Notes have been offered pursuant to an Underwriting Agreement dated as of April 25, 2012 (the “ Underwriting Agreement ”) among the Company, the Guarantors and the Underwriters named therein (the “ Underwriters ”).

In arriving at the opinions expressed below, we have examined originals, or copies certified or otherwise identified to our satisfaction as being true and complete copies of the originals, of the Base Indenture, the Supplemental Indenture, the Notes and the Guarantees (collectively, the “ Note Documents ”) and such other documents, corporate records, certificates of officers of the Company and the Guarantors and of public officials and other instruments as we have deemed necessary or advisable to enable us to render these opinions. In our examination, we have assumed, without independent investigation, the genuineness of

May 1, 2012

Page 2

all signatures, the legal capacity and competency of all natural persons, the authenticity of all documents submitted to us as originals and the conformity to original documents of all documents submitted to us as copies. To the extent that our opinions may be dependent upon such matters, we have assumed, without independent investigation, that each of the Guarantors, other than the Guarantors identified on Annex A as “Specified Guarantors” (each Guarantor so identified, a “Specified Guarantor”) is validly existing under the laws of its jurisdiction of incorporation, has all requisite corporate or other entity power to execute, deliver and perform its obligations under the Note Documents to which it is a party; that the execution and delivery of such documents by each such party and the performance of its obligations thereunder have been duly authorized by all necessary corporate or other action and do not violate any law, regulation, order, judgment or decree applicable to each such party; and that such documents have been duly executed and delivered by each such party. As to any facts material to these opinions, we have relied to the extent we deemed appropriate and without independent investigation upon statements and representations of officers and other representatives of the Company and the Guarantors and others.

Based upon the foregoing, and subject to the assumptions, exceptions, qualifications and limitations set forth herein, we are of the opinion that the Notes, when authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters in accordance with the terms of the Underwriting Agreement, will be legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms and when the Notes with the Guarantees endorsed thereon have been duly authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Underwriters in accordance with the terms of the Underwriting Agreement, the Guarantees of the Notes will be legal, valid and binding obligations of the Guarantors obligated thereon, enforceable against such Guarantors in accordance with their respective terms.

The opinions expressed above are subject to the following additional exceptions, qualifications, limitations and assumptions:

A. We render no opinion herein as to matters involving the laws of any jurisdiction other than the State of New York and to the extent relevant for our opinions herein , the laws of the States of California, Colorado and Texas and the Delaware General Corporation Law and the Delaware Limited Liability Company Act. We are not admitted to practice in the State of Delaware; however, we are generally familiar with the Delaware General Corporation Law and the Delaware Limited Liability Company Act as currently in effect and have made such inquiries as we consider necessary to render these opinions. We have further assumed without independent investigation that the operating agreement of each Specified Guarantor that is a Delaware limited liability company constitutes a legal, valid and binding obligation of each party thereto, enforceable against it in accordance with its terms; to the extent our opinions are dependent on the interpretation of such agreement, they are based on the plain meaning of the provisions thereof in light of the Delaware Limited Liability Company Act. Without limitation, we do not express any opinion regarding any

May 1, 2012

Page 3

Delaware contract law. This opinion is limited to the effect of the current state of the laws of the States of New York, California, Colorado and Texas and the Delaware General Corporation Law and the Delaware Limited Liability Company Act and the facts as they currently exist. We assume no obligation to revise or supplement this opinion in the event of future changes in such laws or the interpretations thereof or such facts.

B. The opinions above are subject to (i) the effect of any bankruptcy, insolvency, reorganization, moratorium, arrangement or similar laws affecting the rights and remedies of creditors’ generally, including without limitation the effect of statutory or other laws regarding fraudulent transfers or preferential transfers, (ii) general principles of equity, including without limitation concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance, injunctive relief or other equitable remedies regardless of whether enforceability is considered in a proceeding in equity or at law and (iii) the provisions of: (1) Article Eight of the Certificate of Incorporation of CH Investments of Texas, Inc.; (2) Article Eight of the Certificate of Incorporation of CHTEX of Texas, Inc.; (3) Paragraph Eight of the Certificate of Incorporation of D.R. Horton, Inc. – Chicago (excluding the first three sentences thereof); and (4) Article Ten of the Certificate of Incorporation of Western Pacific Housing, Inc.

C. We express no opinion regarding the effectiveness of (i) any waiver of stay, extension or usury laws or of unknown future rights, (ii) provisions relating to indemnification, exculpation or contribution, to the extent such provisions may be held unenforceable as contrary to public policy or federal or state securities laws, or (iii) any purported fraudulent transfer “savings” clause.

We consent to the filing of this opinion as an exhibit to the Registration Statement, and we further consent to the use of our name under the caption “Legal Matters” in the Registration Statement and the Prospectus Supplement. In giving these consents, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.

Very truly yours,

/s/ Gibson, Dunn & Crutcher LLP

ANNEX A

Guarantors


Name	Form of Entity	Jurisdiction of Formation	Specified Guarantor
C. Richard Dobson Builders, Inc.	Corporation	Virginia	No
CH Investments of Texas, Inc.	Corporation	Delaware	Yes
CHI Construction Company	Corporation	Arizona	No
CHTEX of Texas, Inc.	Corporation	Delaware	Yes
Continental Homes, Inc.	Corporation	Delaware	Yes
Continental Homes of Texas, L.P.	Limited Partnership	Texas	Yes
Continental Residential, Inc.	Corporation	California	Yes
D.R. Horton—Emerald, Ltd.	Limited Partnership	Texas	Yes
D.R. Horton—Schuler Homes, LLC	Limited Liability Company	Delaware	Yes
D.R. Horton—Texas, Ltd.	Limited Partnership	Texas	Yes
D.R. Horton, Inc.—Birmingham	Corporation	Alabama	No
D.R. Horton, Inc.—Chicago	Corporation	Delaware	Yes
D.R. Horton, Inc.—Dietz-Crane	Corporation	Delaware	Yes
D.R. Horton, Inc.—Fresno	Corporation	Delaware	Yes
D.R. Horton, Inc.—Greensboro	Corporation	Delaware	Yes
D.R. Horton, Inc.—Gulf Coast (f/k/a DRH Regrem V, Inc.)	Corporation	Delaware	Yes

May 1, 2012

Page 5


D.R. Horton, Inc.—Huntsville	Corporation	Delaware	Yes
D.R. Horton, Inc.—Jacksonville	Corporation	Delaware	Yes
D.R. Horton, Inc.—Louisville	Corporation	Delaware	Yes
D.R. Horton, Inc.—Minnesota	Corporation	Delaware	Yes
D.R. Horton, Inc.—New Jersey	Corporation	Delaware	Yes
D.R. Horton, Inc.—Portland	Corporation	Delaware	Yes
D.R. Horton, Inc.—Sacramento	Corporation	California	Yes
D.R. Horton, Inc.—Torrey	Corporation	Delaware	Yes
D.R. Horton LA North, Inc. (f/k/a DRH Regrem X, Inc.)	Corporation	Delaware	Yes
D.R. Horton BAY, Inc. (f/k/a D.R. Horton OCI Inc., D.R. Horton Orange County Inc. and DRH Regrem IX, Inc.)	Corporation	Delaware	Yes
D.R. Horton Cruces Construction, Inc. (f/k/a DRH Regrem XI, Inc.)	Corporation	Delaware	Yes
D.R. Horton Los Angeles Holding Company, Inc.	Corporation	California	Yes

May 1, 2012

Page 6


D.R. Horton Management Company, Ltd.	Limited Partnership	Texas	Yes
D.R. Horton Materials, Inc.	Corporation	Delaware	Yes
D.R. Horton VEN Inc. (f/k/a D.R. LAV Inc. and D.R. Horton San Diego Holding Company, Inc.)	Corporation	California	Yes
DRH Cambridge Homes, Inc.	Corporation	California	Yes
DRH Cambridge Homes, LLC	Limited Liability Company	Delaware	Yes
DRH Construction, Inc.	Corporation	Delaware	Yes
DRH Regrem VII, LP	Limited Partnership	Texas	Yes
DRH Regrem VIII, LLC	Limited Liability Company	Delaware	Yes
DRH Regrem XII, LP	Limited Partnership	Texas	Yes
DRH Regrem XIV, Inc.	Corporation	Delaware	Yes
DRH Regrem XV, Inc.	Corporation	Delaware	Yes
DRH Regrem XVI, Inc.	Corporation	Delaware	Yes
DRH Regrem XVII, Inc.	Corporation	Delaware	Yes
DRH Regrem XVIII, Inc.	Corporation	Delaware	Yes
DRH Regrem XIX, Inc.	Corporation	Delaware	Yes
DRH Regrem XX, Inc.	Corporation	Delaware	Yes
DRH Regrem XXI, Inc.	Corporation	Delaware	Yes

May 1, 2012

Page 7


DRH Regrem XXII, Inc.	Corporation	Delaware	Yes
DRH Regrem XXIII, Inc.	Corporation	Delaware	Yes
DRH Regrem XXIV, Inc.	Corporation	Delaware	Yes
DRH Regrem XXV, Inc. (f/k/a D.R. Horton VEN, Inc. and D.R. Horton Inc. – Los Angeles)	Corporation	Delaware	Yes
DRH Southwest Construction, Inc.	Corporation	California	Yes
DRH Tucson Construction, Inc.	Corporation	Delaware	Yes
HPH Homebuilders 2000 L.P.	Limited Partnership	California	Yes
KDB Homes, Inc.	Corporation	Delaware	Yes
Meadows I, Ltd.	Corporation	Delaware	Yes
Meadows II, Ltd.	Corporation	Delaware	Yes
Meadows VIII, Ltd.	Corporation	Delaware	Yes
Meadows IX, Inc.	Corporation	New Jersey	No
Meadows X, Inc.	Corporation	New Jersey	No
Melmort Co.	Corporation	Colorado	Yes
Melody Homes, Inc.	Corporation	Delaware	Yes
Schuler Homes of Arizona LLC	Limited Liability Company	Delaware	Yes
Schuler Homes of California, Inc.	Corporation	California	Yes
Schuler Homes of Oregon, Inc.	Corporation	Oregon	No
Schuler Homes of Washington, Inc.	Corporation	Washington	No
Schuler Mortgage, Inc.	Corporation	Delaware	Yes
Schuler Realty Hawaii, Inc.	Corporation	Hawaii	No

May 1, 2012

Page 8


SGS Communities at Grande Quay, L.L.C.	Limited Liability Company	New Jersey	No
SHA Construction LLC	Limited Liability Company	Delaware	Yes
SHLR of California, Inc.	Corporation	California	Yes
SHLR of Colorado, Inc.	Corporation	Colorado	Yes
SHLR of Nevada, Inc.	Corporation	Nevada	No
SHLR of Utah, Inc.	Corporation	Utah	No
SHLR of Washington, Inc.	Corporation	Washington	No
SRHI LLC	Limited Liability Company	Delaware	Yes
SSHI LLC	Limited Liability Company	Delaware	Yes
Vertical Construction Corporation	Corporation	Delaware	Yes
Western Pacific Funding, Inc.	Corporation	California	Yes
Western Pacific Housing-Antigua, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing-Aviara, L.P.	Limited Partnership	California	Yes
Western Pacific Housing-Boardwalk, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing-Broadway, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing-Canyon Park, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing-Carmel, LLC	Limited Liability Company	Delaware	Yes

May 1, 2012

Page 9


Western Pacific Housing—Carrillo, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Communications Hill, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Copper Canyon, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Creekside, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Culver City, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—Del Valle, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Lomas Verdes, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Lost Hills Park, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—McGonigle Canyon, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Mountaingate, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—Norco Estates, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Oso, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—Pacific Park II, LLC	Limited Liability Company	Delaware	Yes

May 1, 2012

Page 10


Western Pacific Housing—Park Avenue East, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Park Avenue West, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Playa Vista, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Poinsettia, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—River Ridge, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Robinhood Ridge, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Santa Fe, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Scripps, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—Scripps II, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Seacove, L.P.	Limited Partnership	California	Yes
Western Pacific Housing—Studio 528, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Terra Bay Duets, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Torrance, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Torrey Commercial, LLC	Limited Liability Company	Delaware	Yes

May 1, 2012

Page 11


Western Pacific Housing—Torrey Meadows, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Torrey Multi-Family, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Torrey Village Center, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Vineyard Terrace, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Windemere, LLC	Limited Liability Company	Delaware	Yes
Western Pacific Housing—Windflower, L.P.	Limited Partnership	California	Yes
Western Pacific Housing, Inc.	Corporation	Delaware	Yes
Western Pacific Housing, L.P. (f/k/a Western Pacific Housing Co., a California Limited Partnership)	Limited Partnership	California	Yes
Western Pacific Housing Management, Inc.	Corporation	California	Yes
WPH-Camino Ruiz, LLC	Limited Liability Company	Delaware	Yes