FIRST SUPPLEMENTAL INDENTURE dated as of June 21, 2016 between FORESTAR (USA) REAL ESTATE GROUP INC., THE GUARANTORS NAMED HERETO and U.S. BANK NATIONAL ASSOCIATION, as Trustee to the INDENTURE dated as of May 12, 2014 between FORESTAR (USA) REAL ESTATE GROUP INC., THE GUARANTORS NAMED THEREIN and U.S. BANK NATIONAL ASSOCIATION as Trustee 8.500% SENIOR SECURED NOTES DUE 2022

The Indenture is hereby amended to delete Section 4.03 (Reports), Section 4.07 (Restricted Payments), Section 4.08 (Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries), Section 4.09 (Incurrence of Indebtedness and Issuance of Preferred Stock), Section 4.10 (Asset Sales), Section 4.11 (Transactions with Affiliates), Section 4.12 (Liens), Section 4.15 (Offer to Repurchase Upon a Change of Control), Section 4.16 (Additional Note Guarantees), Section 4.17 (Designation of Restricted and Unrestricted Subsidiaries), Section 4.18 (Payment for Consent), and clauses (3) and (4) of Section 5.01 (Mergers, Consolidation or Sale of Assets);

The failure to comply with the terms of any of the Sections of the Indenture set forth in clause (i) above shall no longer constitute a Default or an Event of Default under the Indenture and shall no longer have any other consequence under the Indenture;

The Indenture is hereby amended to delete clauses (4), (5), (6), (7) and (8) of Section 6.01 (Events of Default) in their entirety and all references thereto contained in Section 6.01 and elsewhere in the Indenture in their entirety, and the occurrence of the events described in (4), (5), (6), (7) and (8) of Section 6.01 shall no longer constitute Events of Default;

All definitions set forth in Section 1.01 of the Indenture that relate to defined terms used solely in sections deleted by this First Supplemental Indenture are hereby deleted in their entirety; and

All references to Sections 5.01 and 6.01 of the Indenture shall mean Sections 5.01 and 6.01 as amended by this First Supplemental Indenture.

Except as expressly supplemented hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This First Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of the Securities heretofore or hereafter authenticated and delivered shall be bound hereby. In the event of a conflict between the terms and conditions of the Indenture and the terms and conditions of this First Supplemental Indenture, then the terms and conditions of this First Supplemental Indenture shall prevail.

The Notes include certain of the foregoing provisions from the Indenture. Upon the operative date of this First Supplemental Indenture, such provisions from the Notes shall be deemed deleted or amended as applicable.

Notwithstanding an earlier execution date, the provisions of this Supplemental Indenture shall not become operative until the time and date upon which the Company pays the Purchase Price or Total Consideration (as such terms are defined in the Offer to Purchase and Consent Solicitation Statement), as applicable, to all Holders who have validly delivered and not validly revoked consents pursuant to the terms of the Offer to Purchase and Consent Solicitation Statement.