Document:

exv10w23

Exhibit 10.23

FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

     This Amendment to Employment Agreement (the “Amendment”) is entered into as of November
10, 2010 by and between Forestar Group Inc., a Delaware corporation (the “Company”) and James M.
DeCosmo (the “Executive”).

     WHEREAS, the Company and the Executive are currently party to an Employment Agreement dated
August 9, 2007 (the “Employment Agreement”); and

     WHEREAS, the Company and the Executive wish to amend the Employment Agreement for the sole
purpose of complying with Section 162(m) of the Internal Revenue Code of 1986, as amended (the
“Code”) and IRS Revenue Ruling 2008-13.

     NOW, THEREFORE, the Company and the Executive hereby agree as follows:

     1. Section 5(c)(i) of the Employment Agreement shall be deleted in its entirety and replaced
with the following:

     (i) In lieu of any further salary payments to the Executive for periods
subsequent to the Date of Termination, the Company shall pay to the Executive a cash
severance payment equal to the Severance Multiple (as defined below) times the sum
of (A) Base Salary (without regard to any diminution giving rise to the Executive’s
assertion of Good Reason) and (B) the Executive’s target annual bonus for the prior
fiscal year pursuant to any annual bonus or incentive plan maintained by the Company
in respect of such fiscal year (or, if higher, the greatest actual annual bonus in
respect of any of the two (three if the Severance Multiple is three) preceding
fiscal years). For purposes of this Agreement: the “Severance Multiple” shall be two
(2), except that the “Severance Multiple” shall be three (3) if the applicable Date
of Termination occurs either during the first two years beginning on the Effective
Date or after such two-year period and within the two-year period following a Change
in Control as defined in Appendix B hereto; and the “Severance Period” shall be the
two (2) year period beginning on the Date of Termination, except that the “Severance
Period” shall be the three (3) year period beginning on the Date of Termination if
the Severance Multiple is three (3). Such payment shall be made as soon as
practicable (but in any event within five (5) days) following the Date of
Termination; provided that, to the extent required to satisfy the provisions of
Section 409A(a)(2)(B)(i) of the Code, such payments shall be made not earlier than
but as soon as practicable on or in any event within five (5) days after (with
interest at the 6-month certificate of deposit rate published in The Wall Street
Journal on the Date of Termination (or if not published on that date, on the next
following date when published) or, if less, the maximum rate that will avoid, if
applicable, the imposition of any additional excise taxes under Section 4999 of the
Code (the “409A Interest Rate”)) the date that is six (6) months after the Date of
Termination (the “409A Payment Date”). The amount payable pursuant to this clause
(i) shall be reduced by the amount of any cash severance or salary continuation
benefit paid or payable to the Executive under any other plan, policy or program of
the Company.

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     2. Section 5(c)(v) of the Employment Agreement shall be deleted in its
entirety and replaced with the following:

     (v) Notwithstanding any provision of any annual or long-term incentive plan
(exclusive of equity-based plans) to the contrary, the Company shall pay to the
Executive on or as soon as practicable (but in any event within five (5) days)
following the Date of Termination (or to the extent required to satisfy the
provisions of Section 409A(a)(2)(B)(i) of the Code, not earlier than but as soon as
practicable on or in any event within five (5) days after (with interest at the 409A
Interest Rate) the 409A Payment Date) a lump sum amount, in cash, equal to any
unpaid incentive compensation which has been allocated or awarded to the Executive
for a completed bonus cycle preceding the Date of Termination under any such plan
and which, as of the Date of Termination, is contingent only upon the continued
employment of the Executive to a subsequent date. Additionally, and notwithstanding
this Employment Agreement or anything in any annual or long-term incentive plan
(exclusive of equity-based plans) to the contrary, for any bonus cycle that has
begun but not completed as of Executive’s Date of Termination, the aggregate value
of all contingent incentive compensation awards to the Executive for the uncompleted
period under any such plans shall be payable or issuable to the Executive only to
the extent the performance goals and criteria (other than continued performance of
services) are achieved and certified by the Company’s Compensation Committee. The
amount paid (or number of unrestricted shares issued) under the foregoing sentence
shall be equal to the amount of the award, as determined pursuant to its terms (and
assuming continued employment until the end of the award period) multiplied by a
fraction, the numerator of which is the number of full months and any fractional
portion of a month during the period from the first day of the performance award
period through the Date of Termination and the denominator of which is the total
number of months in such performance award period (or if such fraction is greater
than 1/2, multiplied by one (1)). This Section 5(c)(v) shall, as of the date of grant
of any such award, form a part of the terms of any such award and constitute an
amendment to any such awards.

     3. Section 5(c)(ix) of the Employment Agreement shall be amended by adding the following to
the end thereto:

     Notwithstanding this subsection (ix) to the contrary or anything in any other
agreement with the Executive to the contrary, for any equity and equity-based awards
(other than stock options or stock appreciation rights) to the Executive that vest
or become payable if one or more specified performance goals or criteria (other than
continued performance of services) are achieved or the amount of such award that
vests or becomes payable depends upon the extent of achievement of one or more such
performance goals or criteria, such award shall vest and become payable only to the
extent the performance goals or criteria specified therein are actually achieved
(other than continued performance of services).

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     4. Section 5(d) of the Employment Agreement shall be deleted in its entirety and replaced with
the following:

     (d) Requirement of Release. Notwithstanding any other provision of
this Agreement, no amounts shall be payable or otherwise due pursuant to Section
5(b) or 5(c) hereof unless (i) the Executive (or his authorized representative, if
disabled or deceased) executes a release of claims against the Company in the form
set forth as Appendix C hereto within thirty (30) days following the Date of
Termination and (ii) the Executive (or his authorized representative, if disabled or
deceased) fails to revoke such release within such thirty (30) days and within any
period permitted by applicable law for its revocation. The amounts subject to this
Section 5(d) shall then be paid at the last day of such thirty (30) day period.

     5. Except as otherwise provided above, the Employment Agreement shall remain unchanged and in
full force and effect.

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     IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first above
written.

	 	 	 	 	 
	 	FORESTAR GROUP INC.

 	 
	 	By:  	/s/ Kenneth M. Jastrow, II
 	 
	 	 	Kenneth M. Jastrow, II 	 
	 	 	Non-Executive Chairman 	 
	 
	 	EXECUTIVE

 	 
	 	/s/ James M. DeCosmo
 	 
	 	James M. DeCosmo 	 
	 	 	 
	 

4Exhibit 10.5

Exhibit 10.5

STOCK APPRECIATION RIGHT AGREEMENT

THIS STOCK APPRECIATION RIGHT AGREEMENT (this “Agreement”) is made as of the _____day of
                    , 20_____, between AMERICAN NATIONAL INSURANCE COMPANY, a Texas insurance corporation
(the “Company”), and                                          (the “Officer”).

1. Award. Pursuant to the AMERICAN NATIONAL INSURANCE COMPANY 1999 STOCK AND
INCENTIVE PLAN (the “Plan”), as of the date of this Agreement, stock appreciation
rights (“SARS”) are granted as hereinafter provided in the Officer’s name. The Officer
acknowledges receipt of a copy of the Plan, and agrees that this award of SARS shall be subject to
all of the terms and provisions of this Agreement and of the Plan, including future amendments
thereto, if any, pursuant to the terms thereof.

2. SAR Payments.

(a) SAR Spread. Each SAR represents the contractual and conditional right of the
Officer to receive payment from the Company as of the date of exercise thereof of an amount (the
“Spread”) equal in value to the excess, if any, of the then fair market value of one share of the
Company’s common stock, par value $1.00 per share (“Stock”), over $_____. Fair market value
shall be calculated as the closing price of one share of the Stock on the date of exercise or on
the most recent date on which the Stock was publicly traded.

(b) Exercise of SARS. The Officer may exercise the SARS based on the number of full
years of employment from the date of grant hereof to the date of such exercise, in accordance with
the following schedule:

	 	 	 	 	 
	 	 	PERCENTAGE OF SARS	 
	Number of Full Years	 	That May Be Exercised	 
	 
	 	 	 	 
	Less than 1 year
	 	 	0	%
	1 year
	 	 	20	%
	2 years
	 	An additional 20	% 
	3 years
	 	An additional 20	% 
	4 years
	 	An additional 20	% 
	5 years
	 	An additional 20	% 

Once a percentage of the Officer’s SARS becomes exercisable pursuant to the foregoing schedule, the
Officer shall have five years to exercise such percentage of the Officer’s SARS (the “Exercise
Period”) and upon the expiration of such five-year Exercise Period, such percentage of SARS, to the
extent then unexercised, shall terminate and permanently cease to be exercisable. Provided,
however, SARS may be exercised only while the Officer is an officer of the Company and will
terminate and cease to be exercisable should the Officer no longer be an officer of the Company,
except that:

(i) If the Officer dies while an officer of the Company, the five-year Exercise Period
shall be reduced and the Officer’s estate, or the person who acquires the SARS by will or
the laws of descent and distribution or otherwise by reason of the death of the Officer (the
“Officer Representative”), shall have one year following the date of the Officer’s death to
exercise a percentage of the Officer’s SARS equal to the sum of (i) the percentage of the
SARS the Officer was entitled to exercise hereunder as of the date of the Officer’s death
plus (ii) the pro rata portion based upon the period included between the Officer’s date of
death and the preceding August 1, of any additional 20% of the SARS which would have become
exercisable had the Officer survived until the following August 1. SARS not exercised by
the Officer Representative within such one-year period shall terminate and no longer be
exercisable.

 

 

 

(ii) If the Officer ceases to be an officer of the Company by reason of retirement at
or after attaining the age of 65, the five-year Exercise Period shall be reduced and the
Officer (or the Officer Representative in the event of the Officer’s death) shall have one
year following the date of such retirement to exercise a percentage of the Officer’s SARS
equal to the sum of (i) the percentage of SARS the Officer was entitled to exercise
hereunder as of the date of the Officer’s retirement plus (ii) the pro rata portion, if any,
based upon the period included between the Officer’s date of retirement and the preceding
August 1, of any additional 20% of the SARS which would have become exercisable had the
Officer remained an employee until the following August 1.

(c) Exercise and Payment. SARS can be exercised by written notice to the Secretary of
the Company specifying the number of SARS to be exercised. Such exercise date shall be the date
such written notice of exercise is actually received by the Company’s Secretary. Upon exercise of
SARS, the Company shall pay the then Spread amount with respect to such exercised SARS in cash in
full. Upon such exercise and payment, the SARS which were exercised shall terminate.

(d) Corporate Acts. The existence of the SARS shall not affect in any way the right
or power of the Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company’s capital structure or its business, any merger or consolidation of the
Company, any issue of debt or equity securities, the dissolution or liquidation of the Company or
any sale, lease, exchange or other disposition of all or any part of its assets or business or any
other corporate act or proceeding. Upon the occurrence of any such corporate act, the SARS may be
adjusted as contemplated by Article XII of the Plan.

3. Withholding of Tax. To the extent that exercise of the SARS results in
compensation income to the Officer for federal or state income tax purposes, the Officer shall
deliver to the Company at the time of such receipt or lapse, as the case may be, such amount of
money as the Company may require to meet its obligation under applicable tax laws or regulations,
and, if the Officer fails to do so, the Company is authorized to withhold from any remuneration
then or thereafter payable to the Officer any tax required to be withheld by reason of such
resulting compensation income.

4. Employment Relationship. For purposes of this Agreement, the Officer shall be
considered to be in the employment of the Company as long as the Officer remains an officer of
either the Company, a parent or subsidiary corporation of the Company or any successor corporation.
Any question as to whether and when there has been a termination of such employment, and the cause
of such termination, shall be determined by the Company, and its determination shall be final.

5. Notices. Any notices or other communications provided for in this Agreement shall
be sufficient if in writing. In the case of the Officer, such notices or communications shall be
effectively delivered if hand delivered to the Officer at his principal place of employment or if
sent by registered or certified mail to the Officer at the last address he has filed with the
Company. In the case of the Company, such notices or communications shall be effectively delivered
if hand delivered to the Secretary of the Company or if sent by registered or certified mail to the
Secretary of the Company at its principal executive offices.

6. Binding Effect. This Agreement shall be binding upon and inure to the benefit of
any successors to the Company and all persons lawfully claiming under the Officer.

7. Plan Summary and Prospectus. The Officer acknowledges receipt of a Plan Summary
and Prospectus. The Officer agrees that the Company shall have the right, from time to time, to
revise and amend the Plan Summary and Prospectus in the Company’s sole and absolute discretion.

8. Construction and Administration. The Compensation Committee of the Board of
Directors of the Company has the power to construe the Plan and this Agreement and to prescribe
such rules and regulations relating thereto as it may deem advisable. The Compensation Committee
also has the authority, in the exercise of its sole and exclusive discretion, to correct any defect
or supply any omission or reconcile any inconsistency in this Agreement or in the Plan in the
manner and to the extent it
shall deem appropriate. The determinations and actions of the Compensation Committee shall be
conclusive.

 

 

 

9. Controlling Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Texas.

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer
thereunto duly authorized, and the Officer has executed this Agreement, all as of the date first
above written.

	 	 	 	 	 	 	 

	 	 	AMERICAN NATIONAL INSURANCE COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	G. Richard Ferdinandtsen	 	 
	 

	 	 	 	President, Chief Operating Officer	 	 
	 

	 	 	 	 	 	“Company”
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	“Officer”

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