exv4w3



 






Exhibit 4.3



THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO
AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND 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 ANOTHER NOMINEE OF THE DEPOSITARY OR TO THE DEPOSITARY OR BY ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.



UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.




THE RYLAND GROUP, INC.




53/8% Senior Notes due 2012




CUSIP # 783764AL7




      



			
	No. R-1
	 	$250,000,000






     THE RYLAND GROUP, INC., a Maryland corporation (herein called the “Company,” which term
includes any successor Person under the Indenture hereinafter referred to), for value received,
hereby promises to pay to Cede & Co., or registered assigns, the principal sum of Two Hundred Fifty
Million Dollars on May 15, 2012, at the office or agency of the Company referred to below, and to
pay interest thereon, accruing from May 9, 2005, on November 15, 2005 and semi-annually thereafter
on May 15 and November 15 in each year, at the rate of
53/8% per annum until the principal
hereof is paid or made available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest, which shall be May 1 or November 1
(whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to
the Holder on such Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of the Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully provided in said
Indenture.



     Payment of the principal of, and interest on, this Security will be made at the office
appointed by the Company in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made (i) by check mailed to the address of the
Person entitled thereto as such



 









 





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address shall appear in the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto.




     Reference is hereby made to the further provisions of this Security set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.



     Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.



 









 





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     IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal.


	 	 	 	 	 
	Dated: May 9, 2005 	THE RYLAND GROUP, INC.

 	 
	 	By:  	
 	 
	 	 	Gordon A Milne 	 
	 	 	Executive Vice President and
Chief Financial Officer 	 
	 



Attest:









Timothy J. Geckle

Secretary




TRUSTEE’S CERTIFICATE OF AUTHENTICATION





     This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.



	 	 	 	 	 	 	 	 	 
	 	 	JPMorgan Chase Bank, N.A. (formerly known as Chemical Bank), as Trustee  
	 
	 	 	 	 	 	 	 	 
	

	 	 	 	By:	 	 	 	 
	

	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	Authorized Officer	 	 






 









 








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REVERSE OF SECURITY




     This Security is one of a duly authorized issue of securities of the Company (herein called
the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of
June 28, 1996 (herein called the “Indenture”), between the Company and JPMorgan Chase Bank, N.A.
(formerly known as Chemical Bank), as Trustee, herein called the “Trustee” (which term includes any
successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations of rights,
obligations, duties and immunities thereunder of the Company, the Trustee and the Holders of the
Securities and of the terms upon which the Securities are, and are to be, authenticated and
delivered. The terms of this Security include the covenants and terms established by the Third
Supplemental Indenture, dated as of May 9, 2005, among the Company, the Guarantors named therein
and the Trustee, pursuant to the authority granted under the Indenture (such terms and covenants
shall be referred to herein collectively with the terms and covenants set out in the Indenture that
are applicable to the Securities of this series as the “Indenture Terms”). Defined terms used
herein that are not otherwise defined shall have the meanings given such terms in the Indenture
Terms. This Security is one of the series designated on the face hereof, in an aggregate principal
amount of $250,000,000. The Company may subsequently issue additional securities as part of this
series of Securities under the Indenture.



     The Company may, at its option, redeem the Securities in whole at any time or in part from
time to time, on at least 30 but not more than 60 days’ prior notice, at a Redemption Price equal
to the greater of (A) 100% of the principal amount of the Securities being redeemed and (B) the sum
of the present values of the Remaining Scheduled Payments (as defined below) on the Securities
being redeemed, discounted to the Redemption Date, on a semiannual basis, at the Treasury Rate (as
defined below) plus 25 basis points (0.25%).



     The Company will also pay accrued interest on the Securities being redeemed to the Redemption
Date. In determining the Redemption Price and accrued interest, interest will be calculated on the
basis of a 360-day year consisting of twelve 30-day months.



     If money sufficient to pay the Redemption Price of and accrued interest on the Securities to
be redeemed is deposited with the Trustee on or before the Redemption Date, on and after the
Redemption Date interest will cease to accrue on the Securities (or such portions thereof) called
for redemption and such Securities will cease to be Outstanding.



     “Comparable Treasury Issue” means the United States Treasury security selected by the
Reference Treasury Dealer as having a maturity comparable to the remaining term of the Securities
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 the Securities.



     “Comparable Treasury Price” means, with respect to any Redemption Date, (1) the average of the
Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations, or (2) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such quotations.



     “Reference Treasury Dealer” means each of J.P. Morgan Securities Inc. and at least one other
primary U.S. Government securities dealer in New York City selected by Wachovia Capital Markets,
LLC, and their respective successors; provided, however, that, if any of the foregoing ceases to be
a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”),
the Company will substitute another Primary Treasury Dealer.



 









 





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     “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., New York City
time, on the third Business Day preceding such Redemption Date.



     “Remaining Scheduled Payments” means, with respect to any Security, the remaining scheduled
payments of the principal (or of the portion) thereof to be redeemed and interest thereon that
would be due after the related Redemption Date but for such redemption; provided, however, that, if
such Redemption Date is not an Interest Payment Date with respect to such Security, the amount of
the next succeeding scheduled interest payment thereon will be reduced by the amount of interest
accrued thereon to such Redemption Date.



     “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.



     The Indenture Terms contain provisions for defeasance at any time of the entire Indebtedness
of this Security upon compliance with certain conditions set forth therein.



     The following constitute Events of Default: default for a period of 30 days in payment of any
interest on any Security when due; default in payment of principal of, or premium, if any, on, any
Security when due; default in performance of any other covenant in the Indenture with respect to
the Securities or in the Securities which continues for 60 days after written notice to the Company
by the Trustee or by the Holders of at least 25% in principal amount of the Securities of this
series; the occurrence of any event that results in the acceleration of any of the Company or its
Restricted Subsidiaries’ Indebtedness, other than Non-Recourse Indebtedness, of the Company or any
of its Restricted Subsidiaries, that has an Outstanding principal amount of $10,000,000 or more in
the aggregate; default in the payment of any principal or interest in respect of any Indebtedness
of the Company or its Restricted Subsidiaries, other than Non-Recourse Indebtedness, that has an
Outstanding principal amount of $20,000,000 or more and the continuation of such default for ten
Business Days from the date such principal or interest payment became due and payable, after giving
effect to any applicable grace period set forth in the documents governing such Indebtedness; and
certain events of bankruptcy, insolvency or reorganization as provided in the Indenture Terms. If
any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the Outstanding Securities of this series may declare the principal of all of
the Securities of this series to be due and payable immediately. Holders of Securities may not
enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may
require indemnity satisfactory to it before it enforces the Indenture or the Securities. Subject
to certain limitations, Holders of a majority in principal amount of the Securities of this series
may direct the Trustee in its exercise of any trust or power conferred upon the Trustee with
respect to such Securities. The Trustee may withhold from Holders of the Securities of this series
notice of any continuing default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interests. The Company must furnish an annual
compliance certificate to the Trustee.



 









 





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     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Securities of each series to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal amount of the Securities at the
time Outstanding of each series to be affected. Without the consent of any Holder of Securities,
the Indenture or the Securities may be amended to cure any ambiguity, omission, defect or
inconsistency or to make any change that does not adversely affect the rights of any Holder of
Securities in any material respect. The Indenture also contains provisions permitting the Holders
of specified percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the
Company with certain provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holders of this Security shall be conclusive
and binding upon such Holder and upon all future Holders of this Security and of any Security
issued upon the registration of transfer hereof or in exchange or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.



     No reference herein to the Indenture Terms and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional,
to pay the principal of and any premium and interest on this Security at the times, places and
rates, and in the coin or currency, herein prescribed.



     As provided in the Indenture Terms and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency appointed by the Company in any place where
the principal of and any premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder thereof or his attorney duly authorized in writing,
and thereupon one or more new Securities of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.



     The Securities of this series are issuable only in registered form without coupons in
denominations of $2,000.00 and any integral multiple thereof. As provided in the Indenture Terms
and subject to certain limitations set forth therein, Securities of this series are exchangeable
for a like aggregate principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.



     No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.



     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 Terms or for any
claim based on, in respect of or by reason of such obligations or their creation. Each Holder of
Securities of this series by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Securities of this series.



     Prior to due presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security is
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.



 









 





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     No recourse shall be had for the payment of the principal of (and premium, if any) or interest
on this Security, or for any claim based hereon, or otherwise in respect hereof, or based on or in
respect of the Indenture Terms or any indenture supplemental thereto, against any incorporator,
stockholder, officer or director, as such, past, present or future, of the Company or of any
successor corporation, whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived and released.



     JPMorgan Chase Bank, N.A., the Trustee under the Indenture, or any banking institution serving
as successor Trustee thereunder, 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.



     The Company will furnish to any Holder of the Securities of this series upon written request
and without charge a copy of the Indenture. Requests may be made to: The Ryland Group, Inc., 24025
Park Sorrento, Suite 400, Calabasas, California 91302, Attention: Treasurer.