Exhibit
4.3


 


Form of:


 


6.875%  Senior Notes due 2013


 


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.


 


6.875%  Senior Notes due 2013


 


CUSIP #
783764AM5


 


	
  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 June 15, 2013, at the office or agency of
the Company referred to below, and to pay interest thereon, accruing from June
6, 2006, on December 15, 2006 and semi-annually thereafter on June 15 and
December 15 in each year, at the rate of 6.875% 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 December
1 or June 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.


 













 


2


 


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 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.


 













 


3


 


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


 


	
  Dated:

  	
  June 6, 2006

  	
  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

  	
   

  



 













 


4


 


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 Fourth Supplemental Indenture, dated as of June 6, 2006, 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 30 basis points (0.30%).


 


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
Citigroup Global Markets Inc. and at least one other primary U.S. Government
securities dealer in the United States selected by UBS Securities LLC, and
their respective successors; provided, however, that, if any of the foregoing
ceases to be a primary U.S. Government securities dealer in the United States
(a “Primary Treasury Dealer”), the Company will substitute another
Primary Treasury Dealer.


 













 


5


 


“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.


 













 


6


 


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 $1,000.00 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.


 













 


7


 


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.