Exhibit 10.2

FORESTAR GROUP INC.
2018 STOCK INCENTIVE PLAN
(Effective as of May 8, 2018)
1.    Purpose
The purpose of the Forestar Group Inc. 2018 Stock Incentive Plan (the “Plan”) is
to advance the interests of Forestar Group Inc. (the “Company”) by stimulating
the efforts of employees, officers and non-employee directors and certain other
service providers, in each case who are selected to be participants, by
heightening the desire of such persons to continue in working toward and
contributing to the success and progress of the Company. The Plan provides for
the grant of Incentive and Nonqualified Stock Options, Stock Appreciation
Rights, Restricted Stock and Restricted Stock Units, any of which may be
performance-based, as determined by the Administrator.
2.    Definitions
As used in the Plan, the following terms shall have the meanings set forth
below:
(a)    “Administrator” means the Administrator of the Plan in accordance with
Section 15.
(b)    “Award” means an Incentive Stock Option, Nonqualified Stock Option, Stock
Appreciation Right, Restricted Stock, or Restricted Stock Unit granted to a
Participant pursuant to the provisions of the Plan.
(c)    “Award Agreement” means a written agreement or other instrument, which
may be transmitted electronically, at the Company’s Administrator’s discretion,
as may be approved from time to time by the Administrator implementing the grant
of each Award. An Agreement may be in the form of an agreement to be executed by
both the Participant and the Company (or an authorized representative of the
Company) or certificates, notices or similar instruments as approved by the
Administrator.
(d)    “Board” means the board of directors of the Company.
(e)    “Change in Control” means the occurrence of any of the following events:
(1)    The consummation of a merger, consolidation or reorganization of the
Company into or with another corporation or other legal person if the
stockholders of the Company, immediately before such merger, consolidation or
reorganization, do not, immediately following such merger, consolidation or
reorganization, then own directly or indirectly, more than 50% of the combined
voting power of the then-outstanding voting securities of the corporation or
other legal person resulting from such merger, consolidation or reorganization
in substantially the same proportion as their ownership of Voting Securities (as
hereinafter defined) immediately prior to such merger, consolidation or
reorganization; excluding, however, a merger, consolidation or reorganization
into or with D.R. Horton, Inc., any Subsidiary of D.R. Horton, Inc., or an
employee benefit plan or related trustee of D.R. Horton, Inc. or any of its
Subsidiaries;
(2)    The Company sells all or substantially all of its assets to another
corporation or other legal person; excluding, however, a sale to D.R. Horton,
Inc., any Subsidiary of D.R. Horton, Inc., or an employee benefit plan or
related trustee of D.R. Horton, Inc. or any of its Subsidiaries;
(3)    A complete liquidation or dissolution of the Company;
(4)    Any person (as the term “person” is used in Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act) has become the beneficial owner (as the
term “beneficial owner” is defined under Rule 13d-3 or any successor rule or
regulation promulgated under the Exchange Act) of securities representing 50% or
more of the combined voting power of the then-outstanding voting securities of
the Company (“Voting Securities”) (computed in accordance with the standards for
the computation of total percentage ownership for the purposes of Schedule 13D
or Schedule 14D-l or any successor schedule, form or report)); excluding,
however, any acquisition (A) by the Company, any Subsidiary of the Company, or
an employee benefit plan or related trustee of the Company or any of its
Subsidiaries; (B) by D.R. Horton, Inc., any Subsidiary or an employee benefit
plan or related trustee of D.R. Horton, Inc. or any of its Subsidiaries; or (C)
from D.R. Horton, Inc. or any of its Subsidiaries.

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(5)    During any two (2) year period, a majority of the members of the Board
serving at the date of the most recent approval of this Plan by stockholders is
replaced by members of the Board who are not nominated and approved by the
Board.
(f)    “Code” means the Internal Revenue Code of 1986, as amended from time to
time, and the rulings and regulations issues thereunder.
(g)    “Company” means Forestar Group Inc., a Delaware corporation.
(h)    “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(j)    “Incentive Stock Option” means a stock option that is intended to qualify
as an “incentive stock option” within the meaning of Section 422 of the Code.
(k)    “Nonemployee Director” means each person who is, or is elected to be, a
member of the Board and who is not an employee of the Company or any of its
Subsidiaries.
(l)    “Nonqualified Stock Option” means a stock option that is not intended to
qualify as an “incentive stock option” within the meaning of Section 422 of the
Code.
(m)    “Option” means an Incentive Stock Option and/or a Nonqualified Stock
Option granted pursuant to Section 6.
(n)    “Participant” means any individual described in Section 3 to whom Awards
have been granted from time to time by the Administrator and any authorized
transferee of such individual.
(o)    “Plan” means the Forestar Group Inc. 2018 Stock Incentive Plan, as set
forth herein and as amended from time to time.
(p)    “Restricted Stock” means Shares granted pursuant to Section 8.
(q)    “Restricted Stock Unit” means an Award granted to a Participant pursuant
to Section 8 pursuant to which Shares or cash in lieu thereof may be issued in
the future.
(r)    “Service Provider” means a consultant or advisor to the Company or any of
its Subsidiaries who (i) is a natural person, (ii) provides bona fide services
to the Company or any of its Subsidiaries, (iii) provides services other than in
connection with the offer or sale of securities in a capital-raising
transaction, and (iv) does not directly or indirectly promote or maintain a
market for the Company’s securities, in each case, within the meaning of the
General Instructions to Form S-8 under the Securities Act of 1933, as amended.
(s)    “Share” means a share of the Company’s common stock, par value $1.00,
subject to adjustment as provided in Section 11.
(t)    “Stock Appreciation Right” means a right granted pursuant to Section 7
that entitles the Participant to receive, in cash or Shares or a combination
thereof, as determined by the Administrator, value equal to or otherwise based
on the excess of (i) the market price of a specified number of Shares at the
time of exercise over (ii) the exercise price of the right, as established by
the Administrator on the date of grant.
(u)    “Subsidiary” means (i) any corporation (other than the Company or D.R.
Horton, Inc., as applicable) in an unbroken chain of corporations beginning with
the Company (or D.R. Horton, Inc., as applicable) where each of the corporations
in the unbroken chain other than the last corporation owns stock possessing at
least 50 percent or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain, (ii) other than with
respect to Incentive Stock Options, any limited liability company, limited
partnership, general partnership or other entity, the majority of the equity or
ownership interests in which are owned, directly or indirectly, by the Company
(or D.R. Horton, Inc., as applicable), and (iii) if specifically determined by
the Administrator in the context other than with respect to Incentive Stock
Options, any entity in which the Company (or D.R. Horton, Inc., as applicable)
has a significant ownership interest or that is directly or indirectly
controlled by the Company.

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(v)    “Substitute Awards” means Awards granted or Shares issued by the Company
in assumption of, or in substitution or exchange for, awards previously granted,
or the right or obligation to make future awards, by a person or entity acquired
by the Company or any of its Subsidiaries or with which the Company or any of
its Subsidiaries merges or combines.
(w)    “Termination of Employment” means ceasing to serve as a full-time
employee of the Company, any of its Subsidiaries, D.R. Horton, Inc., or any of
its Subsidiaries or, with respect to a Nonemployee Director or other Service
Provider, ceasing to serve as such for the Company, except that with respect to
all or any Awards held by a Participant (i) the Administrator may determine,
subject to Section 6(d), that an approved leave of absence or approved
employment on a less than full-time basis is not considered a “Termination of
Employment,” (ii) the Administrator may determine that a transition of
employment to service with a partnership, joint venture or corporation not
meeting the requirements of a Subsidiary in which D.R. Horton, Inc., the Company
or a Subsidiary is a party is not considered a “Termination of Employment,”
(iii) service as an employee, other service provider or nonemployee director of
D.R. Horton, Inc. or any of its Subsidiaries shall constitute continued
employment with respect to Awards granted to a Participant while he or she
served as an employee, Service Provider or Nonemployee Director of the Company
or any of its Subsidiaries, (iv) service as an employee, Nonemployee Director or
Service Provider of the Company or any of its Subsidiaries shall constitute
continued employment with respect to Awards granted to a Participant while he or
she served as an employee of D.R. Horton, Inc. or any of its Subsidiaries, (v)
service as a member of the Board shall constitute continued employment with
respect to Awards granted to a Participant while he or she served as an employee
or other Service Provider and (vi) service as an employee, other service
provider, or nonemployee director shall constitute continued employment with
respect to Awards granted to a Participant while he or she served as a member of
the Board. The Administrator shall determine whether any corporate transaction,
such as a sale or spin-off of a division or Subsidiary that employs a
Participant, shall be deemed to result in a Termination of Employment for
purposes of any affected Participant’s Awards, and the Administrator’s decision
shall be final and binding. Unless determined otherwise by the Administrator, a
Termination of Employment will be interpreted consistent with the definition of
a “separation from service” under the Code Section 409A Regulations.
3.    Eligibility
Any person who is a current or prospective officer or employee (including,
without limitation, any director who is also an employee, in his or her capacity
as such) of the Company, D.R. Horton, Inc., or either of their respective
Subsidiaries shall be eligible for selection by the Administrator for the grant
of Awards hereunder. To the extent provided by Section 5(e), any Nonemployee
Director shall be eligible for the grant of Awards hereunder as determined by
the Administrator. In addition, any Service Provider shall be eligible for
selection by the Administrator for the grant of Awards hereunder. Options
intending to qualify as Incentive Stock Options may only be granted to employees
of the Company or any Subsidiary within the meaning of Section 424(f) the Code,
as selected by the Administrator.
4.    Effective Date and Termination of Plan
The Plan shall be effective as of May 8, 2018, subject to approval by the
Company’s stockholders on such date (such date, the “Effective Date”). No Awards
shall be granted under the Plan after May 8, 2028, but Awards previously granted
may extend beyond that date; provided, however, that Incentive Stock Options may
not be granted under the Plan after March 21, 2028. Notwithstanding the
foregoing, the Plan may be terminated at such earlier time as the Board or the
Compensation Committee of the Board may determine. Termination of the Plan will
not affect the rights and obligations of the Participants and the Company
arising under Awards theretofore granted and then in effect.
5.    Shares Subject to the Plan and to Awards
(a)    Aggregate Limits. The aggregate number of Shares issuable under the Plan
shall be equal to 3,000,000. The aggregate number of Shares available for grant
under this Plan and the number of Shares subject to outstanding Awards shall be
subject to adjustment as provided in Section 11. The Shares issued pursuant to
Awards granted

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under this Plan may be shares that are authorized and unissued or shares that
were reacquired by the Company, including, without limitation, shares purchased
in the open market.
(b)    Issuance of Shares. For purposes of Section 5(a), the aggregate number of
Shares issued under this Plan at any time shall equal only the number of Shares
actually issued upon exercise or settlement of an Award. Notwithstanding the
foregoing, Shares subject to an Award under the Plan may not again be made
available for issuance under the Plan if such Shares are: (i) Shares that were
subject to a stock-settled Stock Appreciation Right and were not issued upon the
net settlement or net exercise of such Stock Appreciation Right, (ii) Shares
delivered to or withheld by the Company to pay the exercise price of a Stock
Option, (iii) Shares delivered to or withheld by the Company to pay the
withholding taxes related to a Stock Option or a Stock Appreciation Right, or
(iv) Shares repurchased on the open market with the proceeds of a Stock Option
exercise. Shares subject to Awards that have been canceled, expired, forfeited
or otherwise not issued under an Award and Shares subject to Awards settled in
cash shall not count as Shares issued under this Plan.
(c)    Substitute Awards. Substitute Awards shall not reduce the Shares
authorized for issuance under the Plan or authorized for grant to a Participant
in any calendar year. In addition, in the event that a person or entity acquired
by the Company or any of its Subsidiaries, or with which the Company or any of
its Subsidiaries merges or combines, has shares available under a pre-existing
plan approved by its stockholders and not adopted in contemplation of such
acquisition, merger or combination, the shares available for grant pursuant to
the terms of such pre-existing plan (as adjusted, to the extent appropriate,
using the exchange ratio or other adjustment or valuation ratio or formula used
in such acquisition, merger or combination to determine the consideration
payable to the holders of common stock of the entities party to such
transaction) may be used for Awards under the Plan and, notwithstanding any
other provision hereof, shall not reduce the Shares authorized for issuance
under the Plan; provided that Awards using such available shares shall not be
made after the date awards or grants could have been made under the terms of the
pre-existing plan, absent the acquisition, merger or combination, and shall only
be made to individuals who were employees, directors, consultants or advisors of
such acquired, merged or combined company before such acquisition, merger or
combination.
(d)    Tax Code Limits. The aggregate number of Shares that may be issued
pursuant to the exercise of Incentive Stock Options granted under this Plan
shall not exceed 3,000,000, which number shall be calculated and adjusted
pursuant to Section 11 only to the extent that such calculation or adjustment
will not affect the status of any option intended to qualify as an Incentive
Stock Option under Section 422 of the Code.
(e)    Director Awards. The aggregate dollar value of equity-based Awards (based
on the grant date fair value of such Awards) and cash compensation granted under
the Plan or otherwise during any calendar year to any one Nonemployee Director
shall not exceed $500,000; provided, however, that in any calendar year in which
a Nonemployee Director first joins the Board or is designated as Chairman of the
Board, the maximum aggregate dollar value of equity-based and cash compensation
granted to the Nonemployee Director may be up to two hundred percent (200%) of
the foregoing limit and the foregoing limit shall not count any tandem SAR (as
defined in Section 7).
(f)    Individual Award Limits. The aggregate number of Shares issued under this
Plan during any calendar year to any one Participant shall not exceed 250,000,
which number shall be calculated and adjusted pursuant to Section 11.
6.    Options
(a)    Option Awards. Options may be granted at any time and from time to time
prior to the termination of the Plan to Participants as determined by the
Administrator. No Participant shall have any rights as a stockholder with
respect to any Shares subject to Options hereunder until such Shares have been
issued. Each Option shall be evidenced by an Award Agreement. Options granted
pursuant to the Plan need not be identical but each Option must contain and be
subject to the terms and conditions set forth below.
(b)    Price. The Administrator will establish the exercise price per Share
under each Option, which, in no event will be less than the fair market value of
the Shares on the date of grant; provided, however, that the exercise

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price per Share with respect to an Option that is granted in connection with a
merger or other acquisition as a substitute or replacement award for options
held by optionees of the acquired entity may be less than 100% of the market
price of the Shares on the date such Option is granted if such exercise price is
based on a formula set forth in the terms of the options held by such optionees
or in the terms of the agreement providing for such merger or other acquisition.
The exercise price of any Option may be paid in Shares, cash or a combination
thereof, as determined by the Administrator, including, without limitation, an
irrevocable commitment by a broker to pay over such amount from a sale of the
Shares issuable under an Option, the delivery of previously owned Shares and
withholding of Shares deliverable upon exercise.
(c)    No Repricing. Other than in connection with a change in the Company’s
capitalization or other event or transaction described in Section 11, the terms
of outstanding Awards may not be amended to (a) reduce the exercise price of
outstanding Options or take any other action that is treated as a re-pricing
under generally accepted accounting principles (“GAAP”), or (b) at any time when
the exercise price of an Option is above the market value of a Share, cancel,
exchange, buyout or surrender outstanding Options in exchange for cash, other
awards or Options or Stock Appreciation Rights with an exercise price that is
less than the exercise price of the original Options, without stockholder
approval.
(d)    Provisions Applicable to Options. The date on which Options become
exercisable shall be determined at the sole discretion of the Administrator and
set forth in an Award Agreement. Unless provided otherwise in the applicable
Award Agreement, to the extent that the Administrator determines that an
approved leave of absence or employment on a less than full-time basis is not a
Termination of Employment, the vesting period and/or exercisability of an Option
shall be adjusted by the Administrator during or to reflect the effects of any
period during which the Participant is on an approved leave of absence or is
employed on a less than full-time basis.
(e)    Term of Options and Termination of Employment. The Administrator shall
establish the term of each Option, which in no case shall exceed a period of ten
(10) years from the date of grant; provided, however, the term of an Option
(other than an Incentive Stock Option) shall be automatically extended if, at
the time of its scheduled expiration, the Participant holding such Option is
prohibited by law or the Company’s insider trading policy from exercising the
Option, which extension shall expire on the thirtieth (30th) day following the
date such prohibition no longer applies. In addition, the Award Agreement
evidencing the grant of each Option shall set forth the terms and conditions
applicable to such Option upon a Participant’s Termination of Employment.
(f)    Incentive Stock Options. Notwithstanding anything to the contrary in this
Section 6, in the case of the grant of an Option intending to qualify as an
Incentive Stock Option: (i) if the Participant owns stock possessing more than
10 percent of the combined voting power of all classes of stock of the Company
(a “10% Shareholder”), the exercise price of such Option must be at least 110
percent of the fair market value of the Shares on the date of grant and the
Option must expire within a period of not more than five (5) years from the date
of grant, and (ii) Termination of Employment will occur when the person to whom
an Award was granted ceases to be an employee (as determined in accordance with
Section 3401(c) of the Code and the regulations promulgated thereunder) of the
Company and its Subsidiaries. Notwithstanding anything in this Section 6 to the
contrary, options designated as Incentive Stock Options shall not be eligible
for treatment under the Code as Incentive Stock Options (and will be deemed to
be Nonqualified Stock Options) to the extent that either (a) the aggregate fair
market value of Shares (determined as of the time of grant) with respect to
which such Options are exercisable for the first time by the Participant during
any calendar year (under all plans of the Company and any of its Subsidiaries)
exceeds $100,000, taking Options into account in the order in which they were
granted, or (b) such Options otherwise remain exercisable but are not exercised
within three (3) months of Termination of Employment (or such other period of
time provided in Section 422 of the Code).
(g)    No Stockholder Rights. Participants shall have no voting rights and will
have no rights to receive dividends or dividend equivalents in respect of an
Option or any Shares subject to an Option until the Participant has become the
holder of record of such Shares.

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7.    Stock Appreciation Rights
Stock Appreciation Rights may be granted to Participants from time to time
either in tandem with or as a component of other Awards granted under the Plan
(“tandem SARs”) or not in conjunction with other Awards (“freestanding SARs”)
and may, but need not, relate to a specific Option granted under Section 6. The
provisions of Stock Appreciation Rights need not be the same with respect to
each grant or each recipient. Any Stock Appreciation Right granted in tandem
with an Award may be granted at the same time such Award is granted or at any
time thereafter before exercise or expiration of such Award. All freestanding
SARs shall be granted subject to the same terms and conditions applicable to
Options as set forth in Section 6 (including, without limitation, no repricing)
and all tandem SARs shall have the same exercise price, vesting, exercisability,
forfeiture and termination provisions as the Award to which they relate. Subject
to the provisions of Section 6 and the immediately preceding sentence, the
Administrator may impose such other conditions or restrictions on any Stock
Appreciation Right as it shall deem appropriate. Stock Appreciation Rights may
be settled in Shares, cash or a combination thereof, as determined by the
Administrator and set forth in the applicable Award Agreement. Other than in
connection with a change in the Company’s capitalization or other event or
transaction described in Section 11, the terms of outstanding Awards may not be
amended to (a) reduce the exercise price of outstanding Stock Appreciation
Rights or take any other action that is treated as a re-pricing under GAAP, or
(b) at any time when the exercise price of a Stock Appreciation Right is above
the market value of a Share, cancel, exchange, buyout or surrender outstanding
Stock Appreciation Rights in exchange for cash, other awards or Options or Stock
Appreciation Rights with an exercise price that is less than the exercise price
of the original Stock Appreciation Rights, without stockholder approval.
Participants shall have no voting rights and will have no rights to receive
dividends or dividend equivalents in respect of an Award of Stock Appreciation
Rights or any Shares subject to an Award of Stock Appreciation Rights until the
Participant has become the holder of record of such Shares.
8.    Restricted Stock and Restricted Stock Units
(a)    Restricted Stock and Restricted Stock Unit Awards. Restricted Stock and
Restricted Stock Units may be granted at any time and from time to time prior to
the termination of the Plan to Participants as determined by the Administrator.
Restricted Stock is an award or issuance of Shares the grant, issuance,
retention, vesting and/or transferability of which is subject during specified
periods of time to such conditions (including, without limitation, continued
employment or performance conditions) and terms as the Administrator deems
appropriate. Restricted Stock Units are Awards denominated in units of Shares
under which the issuance of Shares is subject to such conditions (including,
without limitation, continued employment or performance conditions) and terms as
the Administrator deems appropriate. Each grant of Restricted Stock and
Restricted Stock Units shall be evidenced by an Award Agreement. Unless
determined otherwise by the Administrator, each Restricted Stock Unit will be
equal to one Share and will entitle a Participant to either the issuance of
Shares or payment of an amount of cash determined with reference to the value of
Shares. To the extent determined by the Administrator, Restricted Stock and
Restricted Stock Units may be satisfied or settled in Shares, cash or a
combination thereof. Restricted Stock and Restricted Stock Units granted
pursuant to the Plan need not be identical but each grant of Restricted Stock
and Restricted Stock Units must contain and be subject to the terms and
conditions set forth below.
(b)    Contents of Agreement. Each Award Agreement shall contain provisions
regarding (i) the number of Shares or Restricted Stock Units subject to such
Award or a formula for determining such number, (ii) the purchase price of the
Shares, if any, and the means of payment, (iii) the performance criteria, if
any, and level of achievement versus these criteria that shall determine the
number of Shares or Restricted Stock Units granted, issued, retainable and/or
vested, (iv) such terms and conditions on the grant, issuance, vesting and/or
forfeiture of the Shares or Restricted Stock Units as may be determined from
time to time by the Administrator, (v) the term of the performance period, if
any, as to which performance will be measured for determining the number of such
Shares or Restricted Stock Units, and (vi) restrictions on the transferability
of the Shares or Restricted Stock Units. Shares issued under a Restricted Stock
Award may be issued in the name of the Participant and held by the Participant
or held by the Company, in each case as the Administrator may provide.
(c)    Vesting and Performance Criteria. The grant, issuance, retention, vesting
and/or, subject to Section 9, settlement of shares of Restricted Stock and
Restricted Stock Units will occur when and in such installments as the
Administrator determines or under criteria the Administrator establishes.

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(d)    Voting Rights. Unless otherwise determined by the Administrator,
Participants holding shares of Restricted Stock granted hereunder may exercise
full voting rights with respect to those shares during the period of
restriction. Participants shall have no voting rights with respect to Shares
underlying Restricted Stock Units unless and until such Shares are reflected as
issued and outstanding shares on the Company’s stock ledger.
(e)    Dividends and Distributions. Participants in whose name Restricted Stock
is granted shall be entitled to receive all dividends and other distributions
paid with respect to those Shares, unless determined otherwise by the
Administrator. The Administrator will determine whether any such dividends or
distributions will be automatically reinvested in additional shares of
Restricted Stock and subject to the same restrictions on transferability as the
Restricted Stock with respect to which they were distributed or whether such
dividends or distributions will be paid in cash. Shares underlying Restricted
Stock Units shall be entitled to dividends or dividend equivalents only to the
extent provided by the Administrator. Notwithstanding the foregoing, any
dividends or distributions on performance-based Restricted Stock or Restricted
Stock Units shall be subject to the same performance-based vesting criteria and
other restrictions on transferability as the underlying Restricted Stock (or
Restricted Stock Units) with respect to which they were paid or distributed.
(f)    Termination of Employment. The Award Agreement evidencing the grant of an
Award of Restricted Stock or Restricted Stock Units shall set forth the terms
and conditions applicable to such Award upon a Participant’s Termination of
Employment.
9.    Deferral of Gains
The Administrator may, in an Award Agreement or otherwise, provide for the
deferred delivery of Shares or cash upon settlement, vesting or other events
with respect to Restricted Stock or Restricted Stock Units. Notwithstanding
anything herein to the contrary, in no event will any deferral of the delivery
of Shares or any other payment with respect to any Award be allowed if the
Administrator determines that the deferral would result in the imposition of the
additional tax under Section 409A(a)(1)(B) of the Code. The Company shall have
no liability to a Participant, or any other party, if an Award that is intended
to be exempt from, or compliant with, Section 409A of the Code is not so exempt
or compliant or for any action taken by the Administrator.
To the extent any payment under this Plan is considered deferred compensation
subject to the restrictions contained in Section 409A of the Code, such payment
may not be made to a “specified employee” (as determined in accordance with a
uniform policy adopted by the Company with respect to all arrangements subject
to Section 409A of the Code) upon a “separation from service” (as defined for
purposes of Section 409A of the Code) before the date that is six months after
the specified employee’s separation form service (or, if earlier, the specified
employee’s death). Any payment that would otherwise be made during this period
of delay shall be accumulated and paid on the sixth month plus one day following
the specified employee’s separation from service (or, if earlier, as soon as
administratively practicable after the specified employee’s death).
10.    Conditions and Restrictions Upon Securities Subject to Awards
The Administrator may provide that the Shares issued upon exercise of an Option
or Stock Appreciation Right or otherwise subject to or issued under an Award
shall be subject to such further agreements, restrictions, conditions or
limitations as the Administrator in its discretion may specify prior to the
exercise of such Option or Stock Appreciation Right or the grant, vesting or
settlement of such Award, including, without limitation, conditions on vesting
or transferability, forfeiture or repurchase provisions and method of payment
for the Shares issued upon exercise, vesting or settlement of such Award
(including, without limitation, the actual or constructive surrender of Shares
already owned by the Participant) or payment of taxes arising in connection with
an Award. Without limiting the foregoing, such restrictions may address the
timing and manner of any resales by the Participant or other subsequent
transfers by the Participant of any Shares issued under an Award, including,
without limitation (i) restrictions under an insider trading policy or pursuant
to applicable law, (ii) restrictions designed to delay and/or coordinate the
timing and manner of sales by Participant and holders of other Company equity
compensation arrangements, (iii) restrictions as to the use of a specified
brokerage firm for such resales or other transfers and (iv) provisions requiring
Shares to be sold on the open market or to the Company in order to satisfy tax
withholding or other obligations.

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11.    Adjustment of and Changes in the Stock
The number and kind of Shares available for issuance under this Plan (including,
without limitation, under any Awards then outstanding), and the number and kind
of Shares subject to the individual limits set forth in Section 5 of this Plan,
shall be equitably adjusted by the Administrator as it determines appropriate to
reflect any reorganization, reclassification, combination or exchange of shares,
repurchase of shares, stock split, reverse stock split, spin-off, dividend or
other distribution of securities, property or cash (other than regular,
quarterly cash dividends), or any other event or transaction that affects the
number or kind of Shares of the Company outstanding. Such adjustment may be
designed to comply with Section 425 of the Code or, except as otherwise
expressly provided in Section 5(d) of this Plan, may be designed to treat the
Shares available under the Plan and subject to Awards as if they were all
outstanding on the record date for such event or transaction or to increase the
number of such Shares to reflect a deemed reinvestment in Shares of the amount
distributed to the Company’s securityholders. The terms of any outstanding Award
shall also be equitably adjusted by the Administrator as to price, number or
kind of Shares subject to such Award, vesting, and other terms to reflect the
foregoing events, which adjustments need not be uniform as between different
Awards or different types of Awards.
In the event there shall be any other change in the number or kind of
outstanding Shares, or any stock or other securities into which such Shares
shall have been changed, or for which it shall have been exchanged, by reason of
a Change in Control, other merger, consolidation or otherwise, then the
Administrator shall, in its sole discretion, determine the appropriate and
equitable adjustment, if any, to be effected. Without limiting the generality of
the foregoing, in the event of any such change described in this paragraph, the
Administrator may, in its sole discretion, (i) provide for the assumption or
substitution of, or adjustment to, each outstanding Award; (ii) accelerate the
vesting of and terminate any restrictions on outstanding Awards; (iii) provide
for cancellation of accelerated Awards that are not exercised within a time
prescribed by the Administrator; or (iv) provide for the cancellation of any
outstanding Awards in exchange for a cash payment to the holders thereof.
No right to purchase fractional shares shall result from any adjustment in
Awards pursuant to this Section 11. In case of any such adjustment, the Shares
subject to the Award shall be rounded down to the nearest whole share. The
Company shall notify Participants holding Awards subject to any adjustments
pursuant to this Section 11 of such adjustment, but (whether or not notice is
given) such adjustment shall be effective and binding for all purposes of the
Plan.
12.    Transferability
Unless the Administrator specifies otherwise and to the extent permitted under
the General Instructions to Form S-8 under the Securities Act of 1933, as
amended, an Award may not be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated by a Participant other than by will or the laws of
descent and distribution, and each Option or Stock Appreciation Right shall be
exercisable only by the Participant during his or her lifetime, and thereafter
by the legal representative of the Participant’s estate or the individual to
whom such Award was transferred by the Participant’s will or the laws of descent
and distribution.
13.    Compliance with Laws and Regulations
This Plan, the grant, issuance, vesting, exercise and settlement of Awards
thereunder, and the obligation of the Company to sell, issue or deliver Shares
under such Awards, shall be subject to all applicable foreign, federal, state
and local laws, rules and regulations, stock exchange rules and regulations, and
to such approvals by any governmental or regulatory agency as may be required.
The Company shall not be required to register in a Participant’s name or deliver
any Shares prior to the completion of any registration or qualification of such
shares under any foreign, federal, state or local law or any ruling or
regulation of any government body which the Administrator shall determine to be
necessary or advisable. To the extent the Company is unable to or the
Administrator deems it infeasible to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company’s counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, the Company
and its Subsidiaries shall be relieved of any liability with respect to the
failure to issue or sell such Shares as to which such requisite authority shall
not have been obtained. No Option or Stock Appreciation Right shall be
exercisable and no Shares shall be issued and/or transferable under any other
Award unless a registration statement

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with respect to the Shares underlying such Option or Stock Appreciation Right is
effective and current or the Company has determined that such registration is
unnecessary.
In the event an Award is granted to or held by a Participant who is employed or
providing services outside the United States, the Administrator may, in its sole
discretion, modify the provisions of the Plan or of such Award as they pertain
to such individual to comply with applicable foreign law or to recognize
differences in local law, currency or tax policy. The Administrator may also
impose conditions on the grant, issuance, exercise, vesting, settlement or
retention of Awards in order to comply with such foreign law and/or to minimize
the Company’s obligations with respect to tax equalization for Participants
employed outside their home country.
14.    Withholding
To the extent required by applicable federal, state, local or foreign law, a
Participant shall be required to satisfy, in a manner satisfactory to the
Company, any withholding tax obligations that arise by reason of an Option
exercise, disposition of Shares issued under an Incentive Stock Option, the
vesting of or settlement of an Award, an election pursuant to Section 83(b) of
the Code or otherwise with respect to an Award. To the extent a Participant
makes an election under Section 83(b) of the Code, within ten days of filing
such election with the Internal Revenue Service, the Participant must notify the
Company in writing of such election. The Company and its Subsidiaries shall not
be required to issue Shares, make any payment or to recognize the transfer or
disposition of Shares until such obligations are satisfied. The Administrator
may provide for or permit these obligations to be satisfied through the
mandatory or elective sale of Shares and/or by having the Company withhold a
portion of the Shares that otherwise would be issued to him or her upon exercise
of the Option or the vesting or settlement of an Award, or by tendering Shares
previously acquired.
15.    Administration of the Plan
(a)    Administrator of the Plan. The Plan shall be administered by the
Administrator who shall be the Compensation Committee of the Board or, in the
absence of a Compensation Committee, the Board itself; provided, however, that
with respect to Awards to Nonemployee Directors, the Administrator shall be the
full Board. Any power of the Administrator may also be exercised by the Board,
except to the extent that the grant or exercise of such authority would cause
any Award or transaction to become subject to (or lose an exemption under) the
short-swing profit recovery provisions of Section 16 of the Exchange Act. To the
extent that any permitted action taken by the Board conflicts with action taken
by the Administrator, the Board action shall control. The Administrator may by
resolution authorize one or more officers of the Company to perform any or all
things that the Administrator is authorized and empowered to do or perform under
the Plan, and for all purposes under this Plan, such officer or officers shall
be treated as the Administrator; provided, however, that the resolution so
authorizing such officer or officers shall specify the total number of Awards
(if any) such officer or officers may award pursuant to such delegated
authority. No such officer shall designate himself or herself or any executive
officer or director of the Company as a recipient of any Awards granted under
authority delegated to such officer. In addition, the Administrator may delegate
any or all aspects of the day-to-day administration of the Plan to one or more
officers or employees of the Company or any of its Subsidiaries, and/or to one
or more agents.
(b)    Powers of Administrator. Subject to the express provisions of this Plan,
the Administrator shall be authorized and empowered to do all things that it
determines to be necessary or appropriate in connection with the administration
of this Plan, including, without limitation: (i) to prescribe, amend and rescind
rules and regulations relating to this Plan and to define terms not otherwise
defined herein; (ii) to determine which persons are Participants, to which of
such Participants, if any, Awards shall be granted hereunder and the timing of
any such Awards; (iii) to grant Awards to Participants and determine the terms
and conditions thereof, including, without limitation, the number of Shares
subject to Awards and the exercise or purchase price of such Shares and the
circumstances under which Awards become exercisable or vested or are forfeited
or expire, which terms may but need not be conditioned upon the passage of time,
continued employment, the satisfaction of performance criteria, the occurrence
of certain events (including, without limitation, events which the Board or the
Administrator determine constitute a Change of Control), or other factors;
(iv) to establish and verify the extent of satisfaction of any performance goals
or other conditions applicable to the grant, issuance, exercisability, vesting
and/or ability to retain any Award; (v) to prescribe and amend the terms of the
agreements or other documents evidencing Awards

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made under this Plan (which need not be identical) and the terms of or form of
any document or notice required to be delivered to the Company by Participants
under this Plan; (vi) to determine whether, and the extent to which, adjustments
are required pursuant to Section 11; (vii) to interpret and construe this Plan,
any rules and regulations under this Plan and the terms and conditions of any
Award granted hereunder, and to make exceptions to any such provisions if the
Administrator, in good faith, determines that it is necessary to do so in light
of the circumstances and for the benefit of the Company; (viii) to approve
corrections in the documentation or administration of any Award; (ix) subject to
any limitations otherwise set forth in Section 16, waive, settle or adjust the
terms of any Award so as to avoid unanticipated consequences, to implement the
intent of the Award, or address unanticipated events (including, but not limited
to, any temporary closure of an applicable stock exchange, disruption of
communications or natural catastrophe); and (x) to make all other determinations
deemed necessary or advisable for the administration of this Plan. The
Administrator may, in its sole and absolute discretion, without amendment to the
Plan, waive or amend the operation of Plan provisions respecting exercise after
Termination of Employment or service to the Company or an affiliate and, except
as otherwise provided herein, adjust any of the terms of any Award.
Notwithstanding anything in the Plan to the contrary, other than in connection
with a change in the Company’s capitalization or other event or transaction
described in Section 11, the terms of outstanding Awards may not be amended to
(a) reduce the exercise price of outstanding Options or Stock Appreciation
Rights or take any other action that is treated as a re-pricing under GAAP, or
(b) at any time when the exercise price of an Option or Stock Appreciation Right
is greater than the market value of a Share, cancel, exchange, buyout or
surrender outstanding Options or Stock Appreciation Rights in exchange for cash,
other awards or Options or Stock Appreciation Rights with an exercise price that
is less than the exercise price of the original Options or Stock Appreciation
Rights, without stockholder approval.
(c)    Determinations by the Administrator. All decisions, determinations and
interpretations by the Administrator regarding the Plan, any rules and
regulations under the Plan and the terms and conditions of or operation of any
Award granted hereunder, shall be final and binding on all Participants,
beneficiaries, heirs, assigns or other persons holding or claiming rights under
the Plan or any Award. The Administrator shall consider such factors as it deems
relevant, in its sole and absolute discretion, to making such decisions,
determinations and interpretations including, without limitation, the
recommendations or advice of any officer or other employee of the Company and
such attorneys, consultants and accountants as it may select.
(d)    Subsidiary Awards. In the case of a grant of an Award to any Participant
employed by a Subsidiary, such grant may, if the Administrator so directs, be
implemented by the Company issuing any subject Shares to the Subsidiary, for
such lawful consideration as the Administrator may determine, upon the condition
or understanding that the Subsidiary will transfer the Shares to the Participant
in accordance with the terms of the Award specified by the Administrator
pursuant to the provisions of the Plan. Notwithstanding any other provision
hereof, such Award may be issued by and in the name of the Subsidiary and shall
be deemed granted on such date as the Administrator shall determine.
16.    Amendment of the Plan or Awards
The Board or the Compensation Committee of the Board may amend, alter or
discontinue this Plan, and the Administrator may amend or alter any agreement or
other document evidencing an Award made under this Plan but, except as provided
pursuant to the provisions of Section 11, no such amendment shall, without the
approval of the stockholders of the Company:
(a)    increase the maximum number of Shares for which Awards may be granted
under this Plan;
(b)    whether before or after the date of grant, reduce the price at which
Options or Stock Appreciation Rights may be exercised below the price provided
for in Section 6(b) or Section 7;
(c)    other than in connection with a change in the Company’s capitalization or
other event or transaction described in Section 11, amend the terms of
outstanding Awards to (a) reduce the exercise price of outstanding Options or
Stock Appreciation Rights or take any other action that is treated as a
re-pricing under GAAP, or (b) at any time when the exercise price of an Option
or Stock Appreciation Right is greater than the market value of a Share, cancel,
exchange, buyout or surrender outstanding Options or Stock Appreciation Rights
in exchange for cash, other awards or Options or Stock Appreciation Rights with
an exercise price that is less than the exercise price of the original Options
or Stock Appreciation Rights;

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(d)    extend the term of this Plan;
(e)    change the class of persons eligible to be Participants;
(f)    otherwise amend the Plan in any manner requiring stockholder approval by
law or under the New York Stock Exchange listing requirements; or
(g)    increase the individual maximum limits in Sections 5(d) and (e).
No amendment or alteration to the Plan or an Award or Award Agreement shall be
made which would impair the rights of the holder of an Award, without such
holder’s consent, provided that no such consent shall be required if (i) the
Administrator determines in its sole discretion and prior to the date of any
change of control (as defined in the applicable Award Agreement) that such
amendment or alteration either is required or advisable in order for the
Company, the Plan or the Award to satisfy any law or regulation or stock
exchange listing requirement or to meet the requirements of or avoid adverse
financial accounting consequences under any accounting standard, or (ii) the
Administrator determines in its sole discretion that such amendment or
alteration is not reasonably likely to significantly diminish the benefits
provided under the Award, or that any such diminution has been adequately
compensated.
17.    No Liability of Company
D.R. Horton, Inc., the Company and their respective Subsidiaries and affiliates
which are in existence or hereafter come into existence shall not be liable to a
Participant or any other person as to: (i) the non-issuance or sale of Shares as
to which the Company has been unable to obtain from any regulatory body having
jurisdiction the authority deemed by the Company’s counsel to be necessary to
the lawful issuance and sale of any Shares hereunder; and (ii) any tax
consequence expected, but not realized, by any Participant or other person due
to the receipt, exercise or settlement of any Award granted hereunder.
 18.    Non-Exclusivity of Plan
Neither the adoption of this Plan by the Board nor the submission of this Plan
to the stockholders of the Company for approval shall be construed as creating
any limitations on the power of the Board or the Administrator to adopt such
other incentive arrangements as either may deem desirable, including, without
limitation, the granting of cash or equity-based compensation awards otherwise
than under this Plan, and such arrangements may be either generally applicable
or applicable only in specific cases.
19.    Governing Law
This Plan and any agreements or other documents hereunder shall be interpreted
and construed in accordance with the laws of the Delaware and applicable federal
law. Any reference in this Plan or in the agreement or other document evidencing
any Awards to a provision of law or to a rule or regulation shall be deemed to
include any successor law, rule or regulation of similar effect or
applicability.
20.    No Right to Employment, Reelection or Continued Service
Nothing in this Plan or an Award Agreement shall interfere with or limit in any
way the right of D.R. Horton, Inc., the Company, their respective Subsidiaries
and/or their respective affiliates to terminate any Participant’s employment,
service on the Board or service for D.R. Horton, Inc., the Company, or their
respective Subsidiaries at any time or for any reason not prohibited by law, nor
shall this Plan or an Award itself confer upon any Participant any right to
continue his or her employment or service for any specified period of time.
Neither an Award nor any benefits arising under this Plan shall constitute an
employment contract with D.R. Horton, Inc., the Company, or their respective
Subsidiaries or affiliates. Subject to Sections 4 and 16, this Plan and the
benefits hereunder may be terminated at any time in the sole and exclusive
discretion of the Board or the Compensation Committee of the Board without
giving rise to any liability on the part of D.R. Horton, Inc., the Company, or
their respective Subsidiaries or affiliates.

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21.    Unfunded Plan
The Plan is intended to be an unfunded plan. Participants are and shall at all
times be general creditors of the Company with respect to their Awards. If the
Administrator or the Company chooses to set aside funds in a trust or otherwise
for the payment of Awards under the Plan, such funds shall at all times be
subject to the claims of the creditors of the Company in the event of its
bankruptcy or insolvency.
22.    Recoupment Policy
Subject to the terms and conditions of the Plan, the Administrator may provide
that any Participant and/or any Award, including any Shares subject to an Award,
will be subject to any recovery, recoupment, clawback and/or other forfeiture
policy maintained by the Company from time to time. Further, to the extent any
policy adopted by New York Stock Exchange (or any other exchange on which the
securities of the Company are listed) pursuant to Section 10D of the Exchange
Act requires the repayment of incentive-based compensation received by a
Participant, whether paid pursuant to an Award granted under this Plan or any
other plan of incentive-based compensation maintained in the past or adopted in
the future by the Company, by accepting an Award under this Plan, the
Participant agrees to the repayment of such amounts to the extent required by
such policy and applicable law.

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