D.R. Horton (DHI) 10-K risk factor changes: FY2021 vs FY2020

In December 2019, [removed: C-19] [added: COVID-19] emerged in the Wuhan region of China and subsequently spread worldwide.

The World Health Organization declared [removed: C-19] [added: COVID-19] a pandemic, resulting in federal, state and local governments and private entities mandating various [removed: restrictions,] [added: restrictions] requiring closure of non-essential businesses for a period of [removed: time.][added: time, which began to adversely affect our business in March 2020.]

There is [removed: significant] uncertainty regarding the extent to which and how long [removed: C-19 and its related effects] [added: COVID-19] will impact the U.S. economy and [removed: level of employment, capital markets, secondary mortgage markets, consumer confidence, demand for] our [removed: homes and availability of mortgage loans to homebuyers.][added: supply chain.]

The extent to which [removed: C-19] [added: COVID-19] impacts our operational and financial performance will depend on future developments, including the duration and spread of [removed: C-19] [added: COVID-19 or other variant strains] and the impact on our customers, trade partners and employees, all of which are highly uncertain and cannot be predicted.

If [removed: C-19 has] [added: COVID-19 or other variant strains have] a significant negative impact on economic conditions over a prolonged period of time, our results of operations and financial condition could be adversely impacted.

The [removed: homebuilding and] [added: homebuilding,] lot development [added: and rental housing] industries are cyclical and affected by changes in economic, real estate or other conditions that could adversely affect our business or financial results.

The [removed: homebuilding and] [added: homebuilding,] lot development [added: and rental housing] industries are cyclical and are significantly affected by changes in general and local economic and real estate conditions, such as:

- availability and prices of new homes [removed: for sale] and [removed: alternatives to new homes, including foreclosed homes,] [added: existing] homes [removed: held] for sale [removed: by investors] and [removed: speculators, other existing homes] [added: availability] and [added: market values of] rental properties; and

If adverse conditions affect our larger markets, they could have a proportionately greater impact on us than on some other [removed: homebuilding] companies.

Such events could hurt the U.S. economy and the housing [removed: market] and [added: rental markets and] in turn, could adversely affect the operating results of our businesses.

[removed: Weather] [added: Physical risks, including weather] conditions and natural disasters, such as hurricanes, tornadoes, earthquakes, volcanic activity, [removed: droughts and] [added: droughts,] floods, [added: hailstorms,] heavy or prolonged [removed: precipitation or wildfires,] [added: precipitation, wildfires and others,] can harm our business.

[removed: These] [added: Any such events] can delay our development work, home construction and home closings, [removed: adversely] [added: unfavorably] affect the cost or availability of materials or [removed: labor or] [added: labor,] damage homes under [removed: construction.][added: construction, lead to changing consumer preferences and/or negatively impact demand for new homes in affected areas.]

The climates and geology of many of the states in which we operate, including California, Florida, Texas and other coastal [removed: areas,] [added: areas] where we have some of our larger operations and which have experienced recent natural disasters, present increased risks of adverse weather or natural disasters.

Deployments of U.S. military personnel to foreign regions, terrorist attacks, other acts of violence or threats to national security and any corresponding response by the United States or others, domestic or international instability or [removed: civil] [added: social or political] unrest may cause an economic slowdown in the markets where we operate, which could adversely affect our business.

If we experience any of the foregoing, potential customers may be less willing or able to buy our [removed: homes.][added: homes or our rental properties.]

We may be unable to change the mix of our home [added: or rental] offerings, reduce the costs of the homes [added: or properties] we build, offer more affordable homes or [added: rental properties or] satisfactorily address changing market conditions in other ways without adversely affecting our profits and returns.

[removed: We may be responsible for losses] associated with mortgage loans originated and sold to third-party purchasers in the event of errors or omissions relating to certain representations and warranties that the loans sold meet certain requirements, including representations as to underwriting standards, the type of collateral, the existence of primary mortgage insurance, and the validity of certain borrower representations in the connection with the loan, and we may be required to repurchase certain of those mortgage loans or provide indemnification.

Our homebuilding operations utilize a [removed: $1.59] [added: $2.19] billion [removed: 5-year] senior unsecured revolving credit facility with an uncommitted accordion feature that could increase the size of the facility to [removed: $2.5] [added: $3.0] billion, subject to certain conditions and availability of additional bank commitments.

Our [removed: 5-year] homebuilding revolving credit facility also provides for the issuance of letters of credit with a sublimit equal to 100% of the revolving credit commitment.

The maturity date of the [removed: 5-year] facility is [removed: October 2, 2024.][added: April 20, 2026.]

[removed: We also have] [added: Forestar has] a [removed: $375] [added: $410] million [removed: 364-day] senior unsecured [removed: homebuilding] revolving credit facility with an uncommitted accordion feature that could increase the size of the facility to [removed: $550] [added: $600] million, subject to certain conditions and availability of additional bank commitments.

The maturity date of the [removed: 364-day] facility is [removed: May 27, 2021.][added: April 16, 2025.]

Forestar and its subsidiaries, our financial services [added: and rental] subsidiaries, and certain of our other subsidiaries are not guarantors under our homebuilding revolving credit [removed: facilities] [added: facility] or our homebuilding senior notes.

Our mortgage subsidiary utilizes a [removed: $1.35] [added: $1.4] billion mortgage repurchase facility to finance the majority of the loans it originates.

D.R. Horton has an automatically effective universal shelf registration statement filed with the SEC in [removed: August 2018,] [added: July 2021,] registering debt and equity securities that may be issued from time to time in amounts to be determined.

Forestar also [removed: has] [added: had] an effective shelf registration statement filed with the SEC in September 2018, registering $500 million of equity securities.

We believe that our existing cash resources, revolving credit facilities, mortgage repurchase facility and ability to access the capital markets or obtain additional financing will provide sufficient liquidity to fund our near-term working capital [removed: needs and debt obligations, including the maturity of $400 million aggregate principal amount of our homebuilding senior notes in fiscal 2021.]

Adverse changes in economic, homebuilding or capital market conditions due to [removed: C-19] [added: COVID-19] or otherwise could negatively affect our business, liquidity and financial results, restrict our ability to obtain additional capital or increase our costs of capital.

During fiscal [removed: 2020,] [added: 2021,] approximately [removed: 66%] [added: 52%] of our mortgage loans were sold directly to Fannie Mae or into securities backed by Ginnie [removed: Mae] [added: Mae,] and [removed: 28%] [added: 41%] were sold to two other major financial entities.

As servicer for these loans, we may [removed: have] [added: incur losses by having] to advance payments to the mortgage-backed securities (MBS) bondholders to the extent there are insufficient collections to satisfy the required principal and interest remittances of the underlying [removed: mortgage-backed securities.][added: MBS.]

The risks associated with our [removed: land and] [added: land,] lot [added: and rental] inventory could adversely affect our business or financial results.

Inventory risks are substantial for our [removed: homebuilding and] [added: homebuilding,] Forestar [added: and rental] businesses.

If housing demand declines, we may not be able to [removed: build and] [added: build,] sell [added: and rent] homes profitably in some of our communities, and we may not be able to fully recover the costs of some of the land and lots we own.

Also, the values of our owned undeveloped land, lots and [removed: housing] inventories may fluctuate significantly due to changes in market conditions.

As a result, our deposits for lots controlled [removed: under] [added: through] purchase contracts may be put at risk, we may have to sell [added: or rent] homes or land for a lower profit margin or record inventory impairment charges on our land and lots.

We have also expanded through investments in new product offerings, new geographic [removed: markets,] [added: markets] and the growth of our [removed: multi-family] rental property operations.

In [removed: October 2017,] [added: fiscal 2018,] we acquired 75% of the outstanding shares of Forestar and at September 30, [removed: 2020,] [added: 2021,] we owned [removed: 65%] [added: 63%] of its outstanding shares.

Forestar is a publicly traded residential lot development company with operations in [removed: 49] [added: 56] markets across [removed: 21] [added: 23] states as of September 30, [removed: 2020.][added: 2021.]

As the controlling [removed: shareholder of Forestar,] [added: shareholder,] we strongly influence the strategic direction and operations of Forestar.

[removed: As a consequence,] [added: Consequently,] we [removed: maintain] [added: have generally maintained] product liability [removed: insurance,] [added: insurance each year,] and we seek to obtain indemnities and certificates of insurance from subcontractors covering claims related to their workmanship and materials.

- availability of financing for companies that purchase our rental properties;

We may be responsible for losses

Additionally, in fiscal 2020 we began retaining mortgage servicing rights on some of our originations.

The capacity of the facility automatically increases during certain higher volume periods and can be further increased through additional commitments.

The total capacity of the facility at September 30, 2021 was $1.8 billion, and its maturity date is February 18, 2022.

At September 30, 2021, $359.9 million remained available for issuance under Forestar’s shelf registration statement, of which $65.6 million was reserved for sales under its at-the-market equity offering program.

In October 2021, after the expiration of Forestar’s existing registration statement and at-the-market equity offering program, a new shelf registration statement became effective, registering $750 million of equity securities.

Forestar anticipates entering into a new at-the-market equity offering program under this new shelf registration statement.

needs and debt obligations.

As restrictive orders relating to COVID-19 were eased and economic activity resumed, demand for our homes increased significantly.

The effects of the pandemic combined with the improvement in economic conditions and the strong demand for new homes caused multiple disruptions in our supply chain, and have resulted in shortages in certain building materials and tightness in the labor market, which has caused our construction cycle to lengthen and costs of building materials to increase.

If shortages and cost increases in building materials and tightness in the labor market persist for a prolonged period of time, our profit margins could be adversely impacted if we are unable to pass on future cost increases to our homebuyers by increasing the selling price of our homes.

As economic activity resumed and restrictive orders relating to COVID-19 were eased, demand for our homes improved significantly during the remainder of fiscal 2020 and remained strong throughout fiscal 2021.

However, the effects of the pandemic combined with the improvement in economic conditions and the strong demand for new homes caused multiple disruptions in our supply chain and have resulted in shortages in certain building materials and tightness in the labor market, which has caused our construction cycle to lengthen.

Our business and financial results could be adversely affected by weather conditions and natural disasters.

Additionally, the physical impacts of climate change may cause these occurrences to increase in frequency, severity and duration.

There has been no material impact on our business from these events or material operational challenges resulting from these events, but they could adversely affect our business in the future.

Further, existing and prospective regulatory and societal responses to climate change intended to reduce potential climate change impacts may increase the upfront costs of purchasing a home, costs to maintain the home and its systems, energy and utility costs and the cost to obtain homeowner and various hazard and flood insurance, or limit homeowners’ ability to obtain these insurance policies altogether.

Although these items have had no material effect on our business, they could adversely affect our business in the future.

Recently, there has been growing concern from advocacy groups, government agencies and the general public over the effects of climate change on the environment.

Such restrictions and requirements could increase our operating and compliance costs or require additional technology and capital investment, which could adversely affect our results of operations.

We believe we are in compliance in all material respects with existing climate-related government restrictions, standards and regulations applicable to our business, and such compliance has not had a material impact on our business.

However, given the rapidly changing nature of environmental laws and matters that may arise that are not currently known, we cannot predict our future exposure concerning such matters, and our future costs to achieve compliance or remedy potential violations could be significant.

Additionally, actual or perceived environmental, social, governance and other sustainability (ESG) matters and our response to these matters could harm our business.

Increasing governmental and societal attention to ESG matters, including expanding mandatory and voluntary reporting, diligence, and disclosure on topics such as climate change, human capital, labor and risk oversight, could expand the nature, scope, and complexity of matters that we are required to control, assess and report.

These factors may alter the environment in which we do business and may increase the ongoing costs of compliance and adversely impact our results of operations and cash flows.

If we are unable to adequately address such ESG matters or fail to comply with all laws, regulations, policies and related interpretations, it could negatively impact our reputation and our business results.

These regulations govern our communications with our shareholders and the capital markets, our financial statement disclosures and our legal

Our reputation could be adversely affected by actual or perceived failures or concerns related to ethics, compliance, product quality and safety, environmental matters, privacy, diversity and inclusion, human rights, compensation and benefits and corporate governance, among other things.

Our ability to attract and retain our key personnel may be impacted by matters involving reputation, culture, diversity and inclusion, compensation and benefits and our management of executive succession.

Our business could be negatively impacted as a result of actions by activist stockholders or others.

We may be subject to actions or proposals from activist stockholders or others that may not align with our business strategies or the interests of our other stockholders.

Responding to such actions could be costly and time-consuming, disrupt our business and operations and/or divert the attention of our Board of Directors and senior management from the pursuit of our business strategies.

Activist stockholders may create perceived uncertainties as to the future direction of our business or strategy, including with respect to our ESG efforts, which may be exploited by our competitors and may make it more difficult to attract and retain qualified personnel, potential homebuyers and business partners and may affect our relationships with current homebuyers, subcontractors, investors and other third parties.

In addition, actions of activist stockholders may cause periods of fluctuation in our stock price based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business.

lose customers, adversely impact our sales and revenue and require us to incur significant expense to address and remediate or otherwise resolve these kinds of issues.

As such, we may be unable to anticipate these techniques, to implement adequate preventative measures or to identify and investigate cybersecurity incidents.

In almost all of the municipalities across the U.S. where we operate, residential construction and financial services have been deemed essential businesses as part of critical infrastructure, and we have continued our homebuilding, lot development and financial services operations in those markets where allowed.

We implemented operational protocols to comply with social distancing and other health and safety standards as required by federal, state and local government agencies, taking into consideration guidelines of the Centers for Disease Control and Prevention and other public health authorities.

Our results of operations are affected by economic conditions, including macroeconomic conditions and levels of business confidence and consumer confidence.

Forestar has a $380 million senior unsecured revolving credit facility with an uncommitted accordion feature that could increase the size of the facility to $570 million, subject to certain conditions and availability of additional bank commitments.

The maturity date of the facility is October 2, 2022.

The capacity of the facility increased, without requiring additional commitments, to $1.575 billion for approximately 45 days around September 30, 2020 and increases again for approximately 30 days around December 31, 2020.

The capacity can also be increased to $1.8 billion subject to the availability of additional commitments.

The mortgage repurchase facility must be renewed annually and currently expires on February 19, 2021.

We expect to renew and extend the term of the mortgage repurchase facility with similar terms prior to its maturity.

At September 30, 2020, $394.3 million remained available, and $100 million of this availability is reserved for sales under Forestar’s at-the-market equity offering program established in August 2020.

In the latter part of fiscal 2020, due to reduced liquidity in the secondary market related to remedies provided in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to borrowers of residential loans, we began retaining mortgage servicing rights on some of our originations.

If the level of new home demand increases significantly in future periods, the risk of shortages and cost increases in residential lots, labor and materials available to the homebuilding industry will likely increase.

For example, we have received Notices of Violation from the United States Environmental Protection Agency related to stormwater compliance at certain of our sites in our Southeast region.

This matter could potentially result in requirements for us to perform additional compliance procedures and to pay monetary sanctions.

These competitors may offer a broader or more attractive array of financing and other products and services to potential customers than we do.

We had $1.6 billion principal amount of our debt maturing before the end of fiscal 2021, including $400 million principal amount of homebuilding senior notes and $1.1 billion outstanding under the mortgage repurchase facility.

under this facility.

regard to its accuracy.

Fiscal [removed: 2020] [added: 2021] Operating Results

In fiscal [removed: 2020,] [added: 2021,] our number of homes closed and home sales revenues increased [removed: 15%] [added: 25%] and [removed: 16%,] [added: 35%,] respectively, compared to the prior year, and our consolidated revenues increased [removed: 15%] [added: 37%] to [removed: $20.3] [added: $27.8] billion compared to [removed: $17.6] [added: $20.3] billion in the prior year.

Our pre-tax income was [removed: $3.0] [added: $5.4] billion in fiscal [removed: 2020] [added: 2021] compared to [removed: $2.1] [added: $3.0] billion in fiscal [removed: 2019,] [added: 2020,] and our pre-tax operating margin was [removed: 14.7%] [added: 19.3%] compared to [removed: 12.1%.][added: 14.7%.]

Cash provided by our homebuilding operations was [removed: $1.9] [added: $1.2] billion in fiscal [removed: 2020] [added: 2021] compared to [removed: $1.4] [added: $1.9] billion in fiscal [removed: 2019.][added: 2020.]

In fiscal [removed: 2020,] [added: 2021,] our return on equity (ROE) was [removed: 22.1%] [added: 31.6%] compared to [removed: 17.2%] [added: 22.1%] in fiscal [removed: 2019,] [added: 2020,] and our homebuilding return on inventory (ROI) was [removed: 24.6%] [added: 37.9%] compared to [removed: 18.1%.][added: 24.6%.]

Within our homebuilding land and lot portfolio, our lots controlled [removed: under] [added: through] purchase contracts represent [removed: 70%] [added: 76%] of the lots owned and controlled at September 30, [removed: 2020] [added: 2021] compared to [removed: 60%] [added: 70%] at September 30, [removed: 2019.][added: 2020.]

Our relationship with Forestar and expanded relationships with other land developers across the country have allowed us to [added: continue to] increase the controlled portion of our [removed: finished] lot pipeline.

During [removed: the latter part of] March 2020, the impacts of [removed: C-19] [added: the COVID-19 pandemic] and the related widespread reductions in economic activity across the United States began to adversely affect our business.

We [removed: were and remain well positioned] [added: are well-positioned] for increased demand with our affordable product offerings, lot supply and housing inventory.

Our operating strategy focuses on enhancing long-term value to our shareholders by leveraging our financial and competitive position in our core homebuilding business to [removed: increase] [added: maximize] the returns on our inventory investments and generate strong profitability and cash flows, while managing risk and maintaining financial flexibility to navigate changing economic conditions and make opportunistic strategic investments.

[removed: We have made operational adjustments as a result of C-19; however, our] [added: Our] strategy remains consistent and includes the following initiatives:

- Managing our inventory of homes under construction relative to demand in each of our [removed: markets] [added: markets,] including starting construction on unsold homes to capture new home demand and actively controlling the number of unsold, completed homes in inventory.

- Continuing to seek opportunities to expand the portion of our land and finished lots controlled through purchase contracts [removed: by assisting Forestar] with [removed: its operations] [added: Forestar] and [removed: expanding our relationships with] [added: other] land [removed: developers across the country.][added: developers.]

- [removed: Investing] [added: Increasing our investments] in the construction [added: and leasing] of single-family and multi-family rental properties to meet rental demand in high growth suburban markets and selling these properties profitably.

However, we cannot provide any assurances that the initiatives listed above will continue to be successful, and we may need to adjust [removed: components] [added: parts] of our strategy to meet future market conditions.

Key financial results as of and for our fiscal year ended September 30, [removed: 2020,] [added: 2021,] as compared to fiscal [removed: 2019,] [added: 2020,] were as follows:

- Homebuilding revenues increased [removed: 15%] [added: 35%] to [removed: $19.6] [added: $26.6] billion compared to [removed: $17.0] [added: $19.6] billion.

- Homes closed increased [removed: 15%] [added: 25%] to [removed: 65,388] [added: 81,965] homes, and the average closing price of those homes was [removed: $299,100.][added: $323,300.]

- Net sales orders increased [removed: 39%] [added: 4%] to [removed: 78,458] [added: 81,378] homes, and the value of net sales orders increased [removed: 40%] [added: 18%] to [removed: $23.6] [added: $27.7] billion.

- Sales order backlog [removed: increased 96%] [added: decreased 2%] to [removed: 26,683] [added: 26,221] homes, [removed: and] [added: while] the value of sales order backlog increased [removed: 98%] [added: 16%] to [removed: $8.2] [added: $9.5] billion.

- Home sales gross margin was [removed: 21.8%] [added: 25.5%] compared to [removed: 20.2%.][added: 21.8%.]

- Homebuilding SG&A expense was [removed: 8.2%] [added: 7.3%] of homebuilding revenues compared to [removed: 8.7%.][added: 8.1%.]

- Homebuilding pre-tax income was [removed: $2.7] [added: $4.8] billion compared to [removed: $1.9] [added: $2.7] billion.

- Homebuilding pre-tax income was [removed: 13.6%] [added: 18.1%] of homebuilding revenues compared to [removed: 11.2%.][added: 13.6%.]

- Homebuilding return on inventory was [removed: 24.6%] [added: 37.9%] compared to [removed: 18.1%.][added: 24.6%.]

- [removed: Cash] [added: Net cash] provided by homebuilding operations was [removed: $1.9] [added: $1.2] billion compared to [removed: $1.4] [added: $1.9] billion.

- Homebuilding cash and cash equivalents totaled [removed: $2.6] [added: $3.0] billion compared to [removed: $1.0] [added: $2.6] billion.

- Homebuilding inventories totaled [removed: $11.0] [added: $13.9] billion compared to [removed: $10.3] [added: $11.0] billion.

- Homes in inventory totaled [removed: 38,000] [added: 47,800] compared to [removed: 27,700.][added: 38,000.]

- Owned lots totaled [removed: 112,600] [added: 127,800] compared to [removed: 121,400,] [added: 112,600,] and lots controlled through purchase contracts increased to [removed: 264,300] [added: 402,500] from [removed: 185,900.][added: 264,300.]

- Homebuilding debt was [removed: $2.5] [added: $3.2] billion compared to [removed: $2.0] [added: $2.5] billion.

- Homebuilding debt to total capital was [removed: 17.5%] [added: 17.8%] compared to [removed: 17.0%.][added: 17.5%, and net homebuilding debt to total capital was 1.7% compared to (0.3)%.]

- Forestar’s revenues increased [removed: 118%] [added: 42%] to [removed: $931.8 million] [added: $1.3 billion] compared to [removed: $428.3] [added: $931.8] million.

Revenues in fiscal [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] included [removed: $887.4 million] [added: $1.2 billion] and [removed: $326.6] [added: $887.4] million, respectively, of revenue from land and lot sales to our homebuilding segment.

- Forestar’s lots sold increased [removed: 151%] [added: 53%] to [removed: 10,373] [added: 15,915] compared to [removed: 4,132.][added: 10,373.]

Lots sold to D.R. Horton totaled [removed: 10,164] [added: 14,839] compared to [removed: 3,728.][added: 10,164.]

- Forestar’s pre-tax income was [removed: $78.1] [added: $146.6 million, which included an $18.1] million [added: loss on extinguishment of debt,] compared to [removed: $45.7] [added: $78.1] million.

- Forestar’s pre-tax income was [removed: 8.4%] [added: 11.1%] of Forestar revenues compared to [removed: 10.7%.][added: 8.4%.]

- Forestar’s cash and cash equivalents totaled [removed: $394.3] [added: $153.6] million compared to [removed: $382.8] [added: $394.3] million.

- Forestar’s inventories totaled [removed: $1.3] [added: $1.9] billion compared to [removed: $1.0] [added: $1.3] billion.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to promote an understanding of our financial condition, results of operations, liquidity and certain other factors that may affect future results.

MD&A is provided as a supplement to, and should be read in conjunction with our consolidated financial statements and notes to those statements that appear elsewhere in this Form 10-K.

This section generally discusses the results of operations for fiscal 2021 compared to 2020.

The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs.

Actual results could differ materially from those discussed in the forward-looking statements.

Factors that could cause or contribute to any differences include, but are not limited to, those discussed under the caption “Forward-Looking Statements” and under Item 1A, “Risk Factors.”

Net income was $4.2 billion in fiscal 2021 compared to $2.4 billion in fiscal 2020, and our diluted earnings per share was $11.41 compared to $6.41.

As economic activity resumed and restrictive orders relating to COVID-19 were eased, demand for our homes improved significantly during the remainder of fiscal 2020 and remained strong throughout fiscal 2021.

We believe the increase in demand has been fueled by historically low interest rates on mortgage loans and the limited supply of homes at affordable price points across most of our markets.

However, multiple disruptions in the supply chain, combined with the improvement in economic conditions and strong demand for new homes, have resulted in shortages in certain building materials and tightness in the labor market, which has caused our construction cycle to lengthen.

We have slowed our home sales pace to more closely align with our production levels, and we are selling homes later in the construction cycle when we have more certainty regarding the home close date for our homebuyers.

Based on the current availability of labor and materials, the stage of completion of our current homes in inventory, production schedules and capacity, we expect to continue restricting the pace of our sales orders in many of our communities in the near term to match our production levels.

Forestar’s net debt to total capital was 35.2% compared to 22.1%.

Due to the change in aggregation of our homebuilding operating segments into six new reportable segments during fiscal 2021, the following tables and related discussion of our homebuilding results include comparative information for the fiscal years ended September 30, 2021, 2020 and 2019.

Based on the new aggregation, our six reporting segments and the states in which we have homebuilding operations are as follows:

| | | | North: | | | | | | Delaware, Illinois, Indiana, Iowa, Kentucky, Maryland, Minnesota, Nebraska, New Jersey, Ohio, Pennsylvania and Virginia | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Year Ended September 30, | | | | | | | | | | | | | | | | | | % Change | | | | | | | | | | | |

| Northwest | | | | | | 4,530 | | | | | | 5,308 | | | | | | 3,919 | | | | | | (15) | | % | | | | 35 | | % |

| Southwest | | | | | | 9,456 | | | | | | 10,214 | | | | | | 7,382 | | | | | | (7) | | % | | | | 38 | | % |

| South Central | | | | | | 23,631 | | | | | | 21,511 | | | | | | 14,942 | | | | | | 10 | | % | | | | 44 | | % |

| Southeast | | | | | | 24,239 | | | | | | 21,103 | | | | | | 15,640 | | | | | | 15 | | % | | | | 35 | | % |

| East | | | | | | 14,038 | | | | | | 14,480 | | | | | | 11,011 | | | | | | (3) | | % | | | | 32 | | % |

| North | | | | | | 5,484 | | | | | | 5,842 | | | | | | 3,671 | | | | | | (6) | | % | | | | 59 | | % |

| | | | | | | 81,378 | | | | | | 78,458 | | | | | | 56,565 | | | | | | 4 | | % | | | | 39 | | % |

| | | | | | | Value (In millions) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Northwest | | | | | | $ | 2,320.2 | | | | | $ | 2,342.3 | | | | | $ | 1,737.4 | | | | | (1) | | % | | | | 35 | | % |

| Southwest | | | | | | 4,179.3 | | | | | | 3,838.8 | | | | | | 2,909.8 | | | | | | 9 | | % | | | | 32 | | % |

| South Central | | | | | | 6,992.9 | | | | | | 5,555.2 | | | | | | 3,821.5 | | | | | | 26 | | % | | | | 45 | | % |

| Southeast | | | | | | 7,632.1 | | | | | | 5,781.2 | | | | | | 4,122.0 | | | | | | 32 | | % | | | | 40 | | % |

| East | | | | | | 4,496.9 | | | | | | 4,086.3 | | | | | | 3,034.1 | | | | | | 10 | | % | | | | 35 | | % |

| North | | | | | | 2,126.8 | | | | | | 2,002.5 | | | | | | 1,218.6 | | | | | | 6 | | % | | | | 64 | | % |

| | | | | | | $ | 27,748.2 | | | | | $ | 23,606.3 | | | | | $ | 16,843.4 | | | | | 18 | | % | | | | 40 | | % |

| Northwest | | | | | | $ | 512,200 | | | | | $ | 441,300 | | | | | $ | 443,300 | | | | | 16 | | % | | | | — | | % |

| Southwest | | | | | | 442,000 | | | | | | 375,800 | | | | | | 394,200 | | | | | | 18 | | % | | | | (5) | | % |

| South Central | | | | | | 295,900 | | | | | | 258,200 | | | | | | 255,800 | | | | | | 15 | | % | | | | 1 | | % |

| Southeast | | | | | | 314,900 | | | | | | 274,000 | | | | | | 263,600 | | | | | | 15 | | % | | | | 4 | | % |

| East | | | | | | 320,300 | | | | | | 282,200 | | | | | | 275,600 | | | | | | 14 | | % | | | | 2 | | % |

| North | | | | | | 387,800 | | | | | | 342,800 | | | | | | 332,000 | | | | | | 13 | | % | | | | 3 | | % |

Net income was $2.4 billion in fiscal 2020 compared to $1.6 billion in the prior year.

The current year results include a tax benefit of $93.4 million related to the retroactive reinstatement of the federal energy efficient homes tax credit.

COVID-19

However, residential construction and financial services were designated as essential businesses in almost all of our markets, which allowed us to continue to operate during that time.

We implemented operational protocols to comply with social distancing and other health and safety standards as required by federal, state and local government agencies, taking into consideration guidelines of the Centers for Disease Control and Prevention and other public health authorities.

During April 2020 when restrictive stay-at-home orders were in place for many markets across the United States, we experienced increases in sales cancellations and decreases in sales orders, and net sales orders for April were 1% lower than the same month in the prior year.

However, as economic activity began to resume and restrictive orders began to be lifted, our weekly sales pace increased significantly, and our cancellation rate returned to normal levels.

For the third and fourth quarters of fiscal 2020, our net sales orders increased by 38% and 81%, respectively, compared to the prior year quarters.

We believe the increase in demand in the second half of the year was fueled by increased buyer urgency due to lower interest rates on mortgage loans, the limited supply of homes at affordable price points across most of our markets and to some extent the lower levels of home sales from mid-March through early April, which caused some pent-up demand.

However, even with the resurgence of demand in our third and fourth quarters, we remain cautious as to the ongoing impact of C-19 on our operations and on the overall economy.

There is significant uncertainty regarding the extent to which and how long C-19 and its related effects will impact the U.S. economy and level of employment, capital markets, secondary mortgage markets, consumer confidence, demand for our homes and availability of mortgage loans to homebuyers.

The extent to which this impacts our operational and financial performance will depend on future developments, including the duration and spread of C-19 and the impact on our customers, trade partners and employees, all of which are highly uncertain and cannot be predicted.

Our operating segments are our 53 homebuilding divisions, our majority-owned Forestar lot development operations, our financial services operations and our other business activities.

The homebuilding operating segments are aggregated into six reporting segments.

These reporting segments, which we also refer to as reporting regions, have homebuilding operations located in the following states:

| | | | Midwest: | | | | | | Colorado, Illinois, Indiana, Iowa, Minnesota and Ohio | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Net Homes Sold | | | | | | | | | | | | | | | | | | Value (In millions) | | | | | | | | | | | | | | | | | | Average Selling Price | | | | | | | | | | | | | | |

| East | | | | | | 10,621 | | | | | | 7,941 | | | | | | 34 | | % | | | | $ | 3,202.1 | | | | | $ | 2,291.1 | | | | | 40 | | % | | | | $ | 301,500 | | | | | $ | 288,500 | | | | | 5 | | % |

| Midwest | | | | | | 5,010 | | | | | | 3,224 | | | | | | 55 | | % | | | | 1,794.8 | | | | | | 1,127.8 | | | | | | 59 | | % | | | | 358,200 | | | | | | 349,800 | | | | | | 2 | | % |

| Southeast | | | | | | 25,216 | | | | | | 18,609 | | | | | | 36 | | % | | | | 6,995.1 | | | | | | 5,011.2 | | | | | | 40 | | % | | | | 277,400 | | | | | | 269,300 | | | | | | 3 | | % |

| South Central | | | | | | 23,289 | | | | | | 16,278 | | | | | | 43 | | % | | | | 5,978.5 | | | | | | 4,123.5 | | | | | | 45 | | % | | | | 256,700 | | | | | | 253,300 | | | | | | 1 | | % |

| Southwest | | | | | | 4,180 | | | | | | 2,797 | | | | | | 49 | | % | | | | 1,219.0 | | | | | | 750.6 | | | | | | 62 | | % | | | | 291,600 | | | | | | 268,400 | | | | | | 9 | | % |

| West | | | | | | 10,142 | | | | | | 7,716 | | | | | | 31 | | % | | | | 4,416.8 | | | | | | 3,539.2 | | | | | | 25 | | % | | | | 435,500 | | | | | | 458,700 | | | | | | (5) | | % |

_____________

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| East | | | | | | 2,722 | | | | | | 2,155 | | | | | | $ | 779.6 | | | | | $ | 607.3 | | | | | 20 | | % | | | | 21 | | % |

| Midwest | | | | | | 1,027 | | | | | | 680 | | | | | | 338.0 | | | | | | 229.2 | | | | | | 17 | | % | | | | 17 | | % |

| Southeast | | | | | | 6,750 | | | | | | 5,410 | | | | | | 1,856.8 | | | | | | 1,444.4 | | | | | | 21 | | % | | | | 23 | | % |

| South Central | | | | | | 6,140 | | | | | | 4,751 | | | | | | 1,583.6 | | | | | | 1,193.2 | | | | | | 21 | | % | | | | 23 | | % |

| Southwest | | | | | | 899 | | | | | | 969 | | | | | | 253.2 | | | | | | 247.0 | | | | | | 18 | | % | | | | 26 | | % |

| West | | | | | | 1,628 | | | | | | 1,323 | | | | | | 717.7 | | | | | | 614.0 | | | | | | 14 | | % | | | | 15 | | % |

The increase in our sales orders reflects the increase in demand for our homes in the second half of the year fueled by increased buyer urgency due to lower interest rates on mortgage loans, the limited supply of homes at affordable price points across most of our markets and to some extent the lower levels of home sales from mid-March through early April, which caused some pent-up demand.

| East | | | | | | 3,583 | | | | | | 1,916 | | | | | | 87 | | % | | | | $ | 1,137.4 | | | | | $ | 576.1 | | | | | 97 | | % | | | | $ | 317,400 | | | | | $ | 300,700 | | | | | 6 | | % |

| Midwest | | | | | | 2,016 | | | | | | 1,063 | | | | | | 90 | | % | | | | 731.5 | | | | | | 364.7 | | | | | | 101 | | % | | | | 362,800 | | | | | | 343,100 | | | | | | 6 | | % |

| Southeast | | | | | | 8,256 | | | | | | 4,277 | | | | | | 93 | | % | | | | 2,378.5 | | | | | | 1,219.5 | | | | | | 95 | | % | | | | 288,100 | | | | | | 285,100 | | | | | | 1 | | % |

| South Central | | | | | | 7,913 | | | | | | 4,166 | | | | | | 90 | | % | | | | 2,076.9 | | | | | | 1,084.0 | | | | | | 92 | | % | | | | 262,500 | | | | | | 260,200 | | | | | | 1 | | % |

| Southwest | | | | | | 2,005 | | | | | | 815 | | | | | | 146 | | % | | | | 596.2 | | | | | | 241.6 | | | | | | 147 | | % | | | | 297,400 | | | | | | 296,400 | | | | | | — | | % |

The net fair value change, which for the years ended September 30, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] was not significant, is recognized in current earnings.

At September 30, [removed: 2020,] [added: 2021,] hedging instruments used to mitigate interest rate risk related to uncommitted mortgage loans held for sale and uncommitted IRLCs totaled a notional amount of [removed: $2.8] [added: $2.7] billion.

Uncommitted IRLCs totaled a notional amount of approximately [removed: $1.7] [added: $1.4] billion and uncommitted mortgage loans held for sale totaled a notional amount of approximately [removed: $1.2] [added: $1.3] billion at September 30, [removed: 2020.][added: 2021.]

At September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] we had MBS totaling [removed: $1.1 billion] [added: $834.6 million] and [removed: $111.4 million,] [added: $1.1 billion,] respectively, that did not yet have IRLCs or closed loans created or assigned and recorded [added: an asset of $1.1 million at September 30, 2021 and] a liability of $5.3 million [removed: and $0.5 million] [added: at September 30, 2020] for the fair value of such MBS position.

The following table sets forth principal cash flows by scheduled maturity, effective weighted average interest rates and estimated fair value of our debt obligations as of September 30, [removed: 2020.][added: 2021.]

The interest rate for our variable rate debt represents the weighted average interest rate in effect at September 30, [removed: 2020.][added: 2021.]

| | | | | | | Fiscal Year Ending September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value at September 30, [removed: 2020] [added: 2021] | | |

| | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2024] [added: 2025] | | | | | | [removed: 2025] [added: 2026] | | | | | | Thereafter | | | | | | Total | | | | | | | | |

| Variable rate | | | | | | $ | [removed: 1,132.6] [added: 1,494.6] | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | [removed: 1,132.6] [added: 1,494.6] | | | | | $ | [removed: 1,132.6] [added: 1,494.6] | |

| Average interest rate | | | | | | [removed: 2.4] [added: 2.1] | | % | | | | — | | % | | | | — | | % | | | | — | | % | | | | — | | % | | | | — | | % | | | | [removed: 2.4] [added: 2.1] | | % | | | | | | |

We have audited the accompanying consolidated balance sheets of D.R. Horton, Inc. and subsidiaries (the Company) as of September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020, and] the related consolidated statements of operations, total equity, and cash flows for [added: each of] the [added: three] years [removed: then ended,] [added: in the period ended September 30, 2021,] and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for [added: each of] the [added: three] years [removed: then ended,] in [added: the period ended September 30, 2021, in] conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of September 30, [removed: 2020] [added: 2021] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated November [removed: 19, 2020] [added: 18, 2021] expressed an unqualified opinion thereon.

| *Description of the Matter* | | | At September 30, [removed: 2020,] [added: 2021,] the Company’s reserve for legal claims related to construction defect matters was [removed: $472.4] [added: $575.1] million. As explained in Note L to the consolidated financial statements, the Company has established reserves for construction defect matters based on the estimated costs of pending legal claims and the estimated costs of anticipated future legal claims related to previously closed homes, and this liability is included within the accrued expenses and other liabilities account in the consolidated balance sheet. This reserve estimate is subject to a high degree of variability and ongoing revision as the circumstances of individual pending claims and historical data and trends change. Management applies judgment in determining the key assumptions used in calculating the reserve for construction defect matters. Auditing the reserve for construction defect matters is complex and especially challenging due to the judgmental nature of the key assumptions related to projections of the frequency of future claims and the costs to resolve claims in consideration of historical claims information. These assumptions are developed by management, are subjective in nature and have a significant effect on the determined amount of the reserve for construction defect matters. Further, the estimated reserve balance is sensitive to changes in these key assumptions. | | |

We have audited D.R Horton, Inc. and subsidiaries’ internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, D.R. Horton, Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of operations, total equity, and cash flows for [added: each of] the [added: three] years [removed: then ended,] [added: in the period ended September 30, 2021,] and the related notes and our report dated November [removed: 19, 2020] [added: 18, 2021] expressed an unqualified opinion thereon.

We also use hedging instruments as part of a program to offer below market interest rate financing to our homebuyers.

| Fixed rate | | | | | | $ | 429.5 | | | | | $ | 700.3 | | | | | $ | 13.7 | | | | | $ | 500.4 | | | | | $ | 900.4 | | | | | $ | 1,400.4 | | | | | $ | 3,944.7 | | | | | $ | 4,045.6 | |

| Average interest rate | | | | | | 4.2 | | % | | | | 5.4 | | % | | | | 3.7 | | % | | | | 2.7 | | % | | | | 3.4 | | % | | | | 2.3 | | % | | | | 3.4 | | % | | | | | | |

Dallas, Texas

November 18, 2021

Dallas, Texas

November 18, 2021

We occasionally enter into forward sales of MBS as part of a program to offer below market interest rate financing to our homebuyers in certain markets.

| Fixed rate | | | | | | $ | 466.5 | | | | | $ | 350.3 | | | | | $ | 700.4 | | | | | $ | 352.7 | | | | | $ | 500.4 | | | | | $ | 800.8 | | | | | $ | 3,171.1 | | | | | $ | 3,356.6 | |

| Average interest rate | | | | | | 2.9 | | % | | | | 4.5 | | % | | | | 5.5 | | % | | | | 8.5 | | % | | | | 2.7 | | % | | | | 3.8 | | % | | | | 4.5 | | % | | | | | | |

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of D.R. Horton, Inc.

Opinion on the Financial Statements

Basis for Opinion

Fort Worth, Texas

November 19, 2020

We believe that our audit provides a reasonable basis for our opinion.

We have audited the consolidated statements of operations, total equity, and cash flows of D.R. Horton, Inc. and its subsidiaries (the “Company”) for the year ended September 30, 2018, including the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the results of operations and cash flows of the Company for the year ended September 30, 2018 in conformity with accounting principles generally accepted in the United States of America.

These consolidated financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit of these consolidated financial statements in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

/s/ PricewaterhouseCoopers LLP

November 16, 2018

We served as the Company’s auditor from 2008 to 2018.

We construct and sell homes through our operating divisions in [removed: 88] [added: 98] markets across [removed: 29] [added: 31] states, primarily under the names of D.R. Horton, *America’s Builder*, Emerald Homes, Express Homes and Freedom Homes.

Our common stock is included in the S&P 500 Index and listed on the New York Stock Exchange [added: (NYSE)] under the ticker symbol “DHI.” Unless the context otherwise requires, the terms “D.R. Horton,” the “Company,” “we” and “our” used herein refer to D.R. Horton, Inc., a Delaware corporation, and its predecessors and subsidiaries.

For the year ended September 30, [removed: 2020,] [added: 2021,] we closed [removed: 65,388] [added: 81,965] homes with an average closing price of [removed: $299,100.][added: $323,300.]

Our business operations consist of homebuilding, a majority-owned residential lot development company, financial [removed: services] [added: services, rental] and other activities.

Our homebuilding operations are our core business, generating [removed: 97%] [added: 96%] of our consolidated revenues of [added: $27.8 billion in fiscal 2021 and 97% of consolidated revenues of] $20.3 [removed: billion, $17.6] billion and [removed: $16.1] [added: $17.6] billion in fiscal [removed: 2020, 2019] [added: 2020] and [removed: 2018,] [added: 2019,] respectively.

Approximately [removed: 91%] [added: 90%] of our home sales revenue in fiscal [removed: 2020] [added: 2021] was generated from the sale of single-family detached homes, with the remainder from the sale of attached homes, such as townhomes, duplexes and triplexes.

[removed: In recent years, we have expanded our] [added: Our] product offerings [removed: to] include a broad range of homes for entry-level, move-up, active adult and luxury [removed: buyers across our markets.][added: buyers.]

During fiscal 2018, we acquired 75% of the outstanding shares of Forestar Group Inc. (Forestar), a publicly traded residential lot development company listed on the [removed: New York Stock Exchange] [added: NYSE] under the ticker symbol “FOR.” Forestar is a component of our homebuilding strategy to enhance operational and capital efficiency and returns by expanding relationships with land developers and increasing the portion of our land and lot position controlled [removed: under] [added: through] land purchase contracts.

At September 30, [removed: 2020,] [added: 2021,] we owned [removed: 65%] [added: 63%] of Forestar’s outstanding common stock.

DHI Mortgage, our 100% owned subsidiary, provides mortgage financing services primarily to our homebuyers and sells substantially all of the mortgages it originates and the [removed: majority of the] related servicing rights to third-party purchasers.

DHI Mortgage originates loans in accordance with purchaser guidelines and sells substantially all of its mortgage production [removed: shortly] after origination.

In addition to our homebuilding, [removed: Forestar and] [added: Forestar,] financial services [added: and rental] operations, we [removed: have subsidiaries that] engage in other business [removed: activities.][added: activities through our subsidiaries.]

[removed: These subsidiaries] [added: We] conduct insurance-related operations, [removed: construct and] own [removed: income-producing multi-family rental properties, own] non-residential real estate including ranch land and improvements and own and operate [removed: oil and gas] [added: energy] related assets.

The [removed: operating] results of these [removed: subsidiaries] [added: operations] are immaterial for separate reporting and therefore are grouped together and presented as other.

In addition to our SEC filings, our corporate governance documents, including our Code of Ethical Conduct for the Chief Executive Officer, Chief Financial Officer and senior financial officers, are available on the “Investor Relations” section of our website under [removed: “Corporate Governance.”] [added: “ESG.”] Our stockholders may also obtain these documents in paper format free of charge upon request made to our Investor Relations department.

Our homebuilding business operates in [removed: 88] [added: 98] markets across [removed: 29] [added: 31] states, which provides us with geographic diversification in our homebuilding inventory investments and our sources of revenues and earnings.

| [added: California] | | | | | | [removed: East Region] [added: Bakersfield] | | | | | | | | | | | | [removed: Midwest] [added: East] Region | | |

| | | | | | | [removed: Northern Delaware] [added: Gainesville] | | | | | | | | | | | | [removed: Fort Collins] [added: Northern Delaware] | | |

| [removed: Georgia] | | | | | | [removed: Savannah] [added: Jacksonville] | | | | | | Illinois | | | | | | Chicago | | |

| [removed: Maryland] | | | | | | [removed: Baltimore] [added: Lakeland] | | | | | | Indiana | | | | | | Fort Wayne | | |

| | | | | | | [removed: Suburban Washington, D.C.] [added: Port St. Lucie] | | | | | | | | | | | | [removed: Indianapolis] [added: Suburban Washington, D.C.] | | |

| [removed: New Jersey] | | | | | | [removed: Northern New Jersey] [added: Ocala] | | | | | | Iowa | | | | | | Des Moines | | |

| | | | | | | [removed: Southern New Jersey] [added: Tampa/Sarasota] | | | | | | Minnesota | | | | | | Minneapolis/St. Paul | | |

| | | | | | | [removed: Greensboro/Winston-Salem] [added: Sacramento] | | | | | | | | | | | | [added: Greensboro/Winston-Salem] | | |

| | | | | | | [removed: Raleigh/Durham] [added: Northwest Region] | | | | | | | | | | | | South Central Region | | |

| [added: Louisiana] | | | | | | [removed: Wilmington] [added: Baton Rouge] | | | | | | [removed: Louisiana] | | | | | | [removed: Baton Rouge] [added: Southern New Jersey] | | |

| [removed: Pennsylvania] | | | | | | [removed: Central Pennsylvania] [added: Lake Charles/Lafayette] | | | | | | [added: Ohio] | | | | | | [removed: Lake Charles/Lafayette] [added: Cincinnati] | | |

| [added: Colorado] | | | | | | [removed: Philadelphia] [added: Colorado Springs] | | | | | | Oklahoma | | | | | | Oklahoma City | | |

| [removed: South Carolina] [added: Hawaii] | | | | | | [removed: Charleston] [added: Oahu] | | | | | | [removed: Texas] [added: South Carolina] | | | | | | [removed: Austin] [added: Charleston] | | |

| | | | | | | [removed: Columbia] [added: Portland/Salem] | | | | | | | | | | | | Bryan/College Station | | |

| | | | | | | [removed: Greenville/Spartanburg] [added: Reno] | | | | | | | | | | | | [removed: Dallas] [added: Greenville/Spartanburg] | | |

| | | | | | | [removed: Myrtle Beach] | | | | | | | | | | | | [removed: Houston] [added: Myrtle Beach] | | |

| [removed: Virginia] | | | | | | [removed: Northern Virginia] [added: Vancouver] | | | | | | | | | | | | Killeen/Temple/Waco | | |

| | | | | | | [removed: Southern Virginia] | | | | | | | | | | | | [removed: Midland/Odessa] [added: Southern Virginia] | | |

| | | | | | | [added: Southwest Region] | | | | | | | | | | | | New Braunfels/San Marcos | | |

| Alabama | | | | | | Birmingham | | | | | | | | | | | | [added: Knoxville] | | |

| | | | | | | Mobile/Baldwin County | | | | | | [removed: Arizona] | | | | | | [removed: Phoenix] [added: Nashville] | | |

| | | | | | | Montgomery | | | | | | | | | | | | [removed: Tucson] | | |

| [added: New Mexico] | | | | | | [removed: Tuscaloosa] [added: Albuquerque] | | | | | | [removed: New Mexico] | | | | | | [removed: Albuquerque] [added: Hilton Head] | | |

| Florida | | | | | | Fort Myers/Naples | | | | | | [added: Delaware] | | | | | | [added: Central Delaware] | | |

Our rental segment consists of multi-family and single-family rental operations.

The multi-family rental operations develop, construct, lease, own and ultimately sell the residential properties.

The single-family rental operations construct single-family rental homes with the intent to later market the community for a bulk sale of homes.

During the fourth quarter of fiscal 2021, we reassessed our operating segments and reportable segments and realigned the aggregation of our homebuilding operating segments into six new reportable segments to better allocate our homebuilding operating segments across geographic reporting regions.

| | | | | | | Denver | | | | | | | | | | | | Tulsa | | |

| | | | | | | Fort Collins | | | | | | Texas | | | | | | Austin | | |

| | | | | | | St. George | | | | | | | | | | | | Dallas | | |

| | | | | | | Spokane | | | | | | | | | | | | Houston | | |

| | | | | | | | | | | | | | | | | | | Midland/Odessa | | |

| Arizona | | | | | | Phoenix | | | | | | | | | | | | San Antonio | | |

| | | | | | | Tucson | | | | | | | | | | | | | | |

| | | | | | | Fresno | | | | | | | | | | | | Augusta | | |

| | | | | | | Modesto/Merced/Stockton | | | | | | North Carolina | | | | | | Asheville | | |

| | | | | | | San Bernardino County | | | | | | | | | | | | Raleigh/Durham | | |

| | | | | | | Southeast Region | | | | | | Tennessee | | | | | | Chattanooga | | |

| | | | | | | Huntsville | | | | | | | | | | | | Memphis | | |

| | | | | | | Tuscaloosa | | | | | | | | | | | | North Region | | |

| | | | | | | Miami/Fort Lauderdale | | | | | | | | | | | | Northwest Indiana | | |

| | | | | | | Orlando | | | | | | Kentucky | | | | | | Louisville | | |

| | | | | | | Tallahassee | | | | | | | | | | | | Western Maryland | | |

| | | | | | | Volusia County | | | | | | Nebraska | | | | | | Omaha | | |

| | | | | | | West Palm Beach | | | | | | New Jersey | | | | | | Northern New Jersey | | |

| | | | | | | | | | | | | Pennsylvania | | | | | | Central Pennsylvania | | |

| | | | | | | | | | | | | | | | | | | Philadelphia | | |

| | | | | | | | | | | | | Virginia | | | | | | Northern Virginia | | |

We completed the construction of most homes within two to seven months in fiscal 2021, which is longer than prior years, as construction times have been impacted by the labor and materials shortages discussed below.

In fiscal 2021, the effects of the COVID-19 pandemic and labor shortages on manufacturing production, combined with the improvement in economic conditions and the strong demand for new homes, caused multiple disruptions in our supply chain and have resulted in shortages in certain building materials and tightness in the construction labor market, which has caused our construction cycle to lengthen.

We sold three multi-family rental properties in fiscal 2021 and two multi-family rental properties in fiscal 2020.

Our single-family rental operations construct single-family rental homes with the intent to later market the community for a bulk sale of homes.

People and Culture

Recruitment, Development and Retention

We believe diversity in the workplace produces unique perspectives and fresh ideas and helps us better serve our customers.

Additionally, the long-term retention of our employees provides us with an experienced, cohesive workforce, which has been vital to achieving our goals.

Compensation and Benefits

In addition to base pay, eligible employees may participate in our short-term incentive bonus program and/or our stock compensation plan.

We also offer our employees a broad range of benefits, including medical, dental and vision healthcare insurance and paid parental leave.

Workplace Safety and Wellness

The safety and well-being of our employees is our first priority.

We take workplace safety seriously at our construction sites and in our offices.

We provide third-party training for our field personnel to become certified by the Occupational Safety and Health Administration (OSHA), and we communicate with all of our employees through a monthly safety newsletter to inform and reinforce our commitment to and concern for their well being.

| Delaware | | | | | | Central Delaware | | | | | | Colorado | | | | | | Denver | | |

| North Carolina | | | | | | Asheville | | | | | | Ohio | | | | | | Cincinnati | | |

| | | | | | | Charlotte | | | | | | | | | | | | Columbus | | |

| | | | | | | Hilton Head | | | | | | | | | | | | Fort Worth | | |

| | | | | | | Southeast Region | | | | | | | | | | | | San Antonio | | |

| | | | | | | Huntsville | | | | | | | | | | | | Southwest Region | | |

| | | | | | | Gainesville | | | | | | | | | | | | West Region | | |

| | | | | | | Jacksonville | | | | | | California | | | | | | Bakersfield | | |

| | | | | | | Ocala | | | | | | | | | | | | Modesto/Merced | | |

| | | | | | | Port St. Lucie | | | | | | | | | | | | San Bernardino County | | |

| | | | | | | Volusia County | | | | | | Hawaii | | | | | | Oahu | | |

| Georgia | | | | | | Atlanta | | | | | | | | | | | | Reno | | |

| | | | | | | Memphis | | | | | | | | | | | | Spokane | | |

| | | | | | | Nashville | | | | | | | | | | | | Vancouver | | |

We have five separate homebuilding regional offices.

We complete the construction of most homes within two to six months.

We have contracts exceeding one year with certain suppliers of building materials that are cancelable at our option.

After these rental properties are constructed and achieve a stabilized level of leased occupancy, the properties in each community are expected to be marketed in bulk for sale.

At September 30, 2020, our homebuilding fixed assets included $87.2 million of assets related to our single-family rental platform representing approximately 740 single-family rental homes and finished lots, including approximately 440 completed homes.

Insurance Agency

Through our insurance agency subsidiary, we collect insurance commissions on homeowner policies placed with third party carriers.

Multi-Family Rental Properties

After DHI Communities has completed construction and achieved a stabilized level of leased occupancy, the property is typically marketed for sale.

DHI Communities had five projects under active construction and one project that was substantially complete at September 30, 2020.

These six projects represent 1,730 multi-family units, including 1,430 units under active construction and 300 completed units.

During fiscal 2020 and 2019, DHI Communities sold multi-family rental properties for a total of $128.5 million and $133.4 million, respectively, and recorded gains on sale totaling $59.4 million and $51.9 million.

At September 30, 2020 and 2019, our consolidated balance sheets included $246.2 million and $204.0 million, respectively, of assets related to DHI Communities.

We compete with numerous other national, regional and local homebuilders and developers for homebuyers, desirable land, raw materials, skilled labor, employees, management talent and financing.

We also compete with resales of existing and foreclosed homes and with the rental housing market.

With respect to administrative or judicial proceedings involving the environment, we have determined that [removed: in future filings] we will disclose any such proceeding if we reasonably believe such proceeding will result in monetary sanctions, exclusive of interest and costs, at or in excess of $1 million.

In fiscal 2013, our mortgage subsidiary was subpoenaed by the United States Department of Justice (DOJ) regarding the adequacy of certain underwriting and quality control processes related to Federal Housing Administration loans originated and sold in prior years.

We have provided information related to these loans and our processes to the DOJ, and communications are ongoing.

The DOJ has to date not asserted any formal claim amount, penalty or fine.

In May and July of 2014, we received Notices of Violation from the United States Environmental Protection Agency (EPA) related to stormwater compliance at certain of our sites in our Southeast region.

This matter could potentially result in monetary sanctions to the Company; however, we do not believe it is reasonably possible that this matter would result in a loss that would have a material effect on our consolidated financial position, results of operations or cash flows.

We are participating in settlement discussions with the U.S. Army Corps of Engineers (ACOE) and DOJ concerning alleged violations of the wetlands provisions of the Clean Water Act at a development site in our Southeast region relating to a violation notice the ACOE issued in April 2017.

This matter could potentially result in a settlement that includes a penalty of approximately $350,000 without an admission of liability.

We do not believe it is reasonably possible that this matter will result in a loss that would have a material effect on our consolidated financial position, results of operations or cash flows.

We believe that such threshold is reasonably designed to result in disclosure of environmental proceedings that are material to our business or financial condition.

For the Fiscal Year Ended September 30, [removed: 2020][added: 2021]

[removed: *(Exact] [added: (Exact] name of registrant as specified in its [removed: charter)*][added: charter)]

| [removed: *(State] [added: (State] or other jurisdiction of incorporation or [removed: organization)*] [added: organization)] | | | | | | [removed: *(I.R.S.] [added: (I.R.S.] Employer Identification [removed: No.)*] [added: No.)] | | |

1341 Horton [removed: Circle][added: Circle, Arlington, Texas 76011]

[removed: *(Registrant’s] [added: (Registrant’s] telephone number, including area [removed: code)*][added: code)]

As of March 31, [removed: 2020,] [added: 2021,] the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately [removed: $11.5] [added: $32.0] billion based on the closing price as reported on the New York Stock Exchange.

As of November [removed: 12, 2020,] [added: 11, 2021,] there were [removed: 364,390,995] [added: 356,529,507] shares of the registrant’s common stock outstanding.

Portions of the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders are incorporated herein by reference (to the extent indicated) in Part III.

[removed: 2020] [added: 2021] ANNUAL REPORT ON FORM 10-K

| [ITEM [removed: 1.](#ibded95f24f424326a39dded243103ee0_16)] [added: 1.](#i8300e37934874469bb7650f2efbd8dd1_16)] | | | [removed: [Business](#ibded95f24f424326a39dded243103ee0_16)] [added: [Business](#i8300e37934874469bb7650f2efbd8dd1_16)] | | | [removed: [1](#ibded95f24f424326a39dded243103ee0_16)] [added: [1](#i8300e37934874469bb7650f2efbd8dd1_16)] | | |

| [ITEM [removed: 1A.](#ibded95f24f424326a39dded243103ee0_19)] [added: 1A.](#i8300e37934874469bb7650f2efbd8dd1_19)] | | | [Risk [removed: Factors](#ibded95f24f424326a39dded243103ee0_19)] [added: Factors](#i8300e37934874469bb7650f2efbd8dd1_19)] | | | [removed: [13](#ibded95f24f424326a39dded243103ee0_19)] [added: [13](#i8300e37934874469bb7650f2efbd8dd1_19)] | | |

| [ITEM [removed: 1B.](#ibded95f24f424326a39dded243103ee0_22)] [added: 1B.](#i8300e37934874469bb7650f2efbd8dd1_22)] | | | [Unresolved Staff [removed: Comments](#ibded95f24f424326a39dded243103ee0_22)] [added: Comments](#i8300e37934874469bb7650f2efbd8dd1_22)] | | | [removed: [24](#ibded95f24f424326a39dded243103ee0_22)] [added: [25](#i8300e37934874469bb7650f2efbd8dd1_22)] | | |

| [ITEM [removed: 2.](#ibded95f24f424326a39dded243103ee0_25)] [added: 2.](#i8300e37934874469bb7650f2efbd8dd1_25)] | | | [removed: [Properties](#ibded95f24f424326a39dded243103ee0_25)] [added: [Properties](#i8300e37934874469bb7650f2efbd8dd1_25)] | | | [removed: [24](#ibded95f24f424326a39dded243103ee0_25)] [added: [25](#i8300e37934874469bb7650f2efbd8dd1_25)] | | |

| [ITEM [removed: 3.](#ibded95f24f424326a39dded243103ee0_28)] [added: 3.](#i8300e37934874469bb7650f2efbd8dd1_28)] | | | [Legal [removed: Proceedings](#ibded95f24f424326a39dded243103ee0_28)] [added: Proceedings](#i8300e37934874469bb7650f2efbd8dd1_28)] | | | [removed: [24](#ibded95f24f424326a39dded243103ee0_28)] [added: [25](#i8300e37934874469bb7650f2efbd8dd1_28)] | | |

| [ITEM [removed: 4.](#ibded95f24f424326a39dded243103ee0_31)] [added: 4.](#i8300e37934874469bb7650f2efbd8dd1_31)] | | | [Mine Safety [removed: Disclosures](#ibded95f24f424326a39dded243103ee0_31)] [added: Disclosures](#i8300e37934874469bb7650f2efbd8dd1_31)] | | | [removed: [24](#ibded95f24f424326a39dded243103ee0_31)] [added: [25](#i8300e37934874469bb7650f2efbd8dd1_31)] | | |

| [ITEM [removed: 5.](#ibded95f24f424326a39dded243103ee0_37)] [added: 5.](#i8300e37934874469bb7650f2efbd8dd1_37)] | | | [Market for Registrant’s Common Equity, Related Stockholder [removed: Matters](#ibded95f24f424326a39dded243103ee0_37)] [added: Matters](#i8300e37934874469bb7650f2efbd8dd1_37)] [and Issuer Purchases of Equity [removed: Securities](#ibded95f24f424326a39dded243103ee0_37)] [added: Securities](#i8300e37934874469bb7650f2efbd8dd1_37)] | | | [removed: [25](#ibded95f24f424326a39dded243103ee0_37)] [added: [26](#i8300e37934874469bb7650f2efbd8dd1_37)] | | |

| [ITEM [removed: 7.](#ibded95f24f424326a39dded243103ee0_43)] [added: 7.](#i8300e37934874469bb7650f2efbd8dd1_43)] | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#ibded95f24f424326a39dded243103ee0_43)] [added: Operations](#i8300e37934874469bb7650f2efbd8dd1_43)] | | | [removed: [28](#ibded95f24f424326a39dded243103ee0_43)] [added: [28](#i8300e37934874469bb7650f2efbd8dd1_43)] | | |

| [ITEM [removed: 7A.](#ibded95f24f424326a39dded243103ee0_85)] [added: 7A.](#i8300e37934874469bb7650f2efbd8dd1_94)] | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#ibded95f24f424326a39dded243103ee0_85)] [added: Risk](#i8300e37934874469bb7650f2efbd8dd1_94)] | | | [removed: [57](#ibded95f24f424326a39dded243103ee0_85)] [added: [60](#i8300e37934874469bb7650f2efbd8dd1_94)] | | |

| [ITEM [removed: 8.](#ibded95f24f424326a39dded243103ee0_94)] [added: 8.](#i8300e37934874469bb7650f2efbd8dd1_103)] | | | [Financial Statements and Supplementary [removed: Data](#ibded95f24f424326a39dded243103ee0_94)] [added: Data](#i8300e37934874469bb7650f2efbd8dd1_103)] | | | [removed: [62](#ibded95f24f424326a39dded243103ee0_94)] [added: [64](#i8300e37934874469bb7650f2efbd8dd1_103)] | | |

| [ITEM [removed: 9.](#ibded95f24f424326a39dded243103ee0_181)] [added: 9.](#i8300e37934874469bb7650f2efbd8dd1_169)] | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#ibded95f24f424326a39dded243103ee0_181)] [added: Disclosure](#i8300e37934874469bb7650f2efbd8dd1_169)] | | | [removed: [105](#ibded95f24f424326a39dded243103ee0_181)] [added: [107](#i8300e37934874469bb7650f2efbd8dd1_169)] | | |

| [ITEM [removed: 9A.](#ibded95f24f424326a39dded243103ee0_184)] [added: 9A.](#i8300e37934874469bb7650f2efbd8dd1_172)] | | | [Controls and [removed: Procedures](#ibded95f24f424326a39dded243103ee0_184)] [added: Procedures](#i8300e37934874469bb7650f2efbd8dd1_172)] | | | [removed: [105](#ibded95f24f424326a39dded243103ee0_184)] [added: [107](#i8300e37934874469bb7650f2efbd8dd1_172)] | | |

| [ITEM [removed: 9B.](#ibded95f24f424326a39dded243103ee0_190)] [added: 9B.](#i8300e37934874469bb7650f2efbd8dd1_178)] | | | [Other [removed: Information](#ibded95f24f424326a39dded243103ee0_190)] [added: Information](#i8300e37934874469bb7650f2efbd8dd1_178)] | | | [removed: [105](#ibded95f24f424326a39dded243103ee0_190)] [added: [107](#i8300e37934874469bb7650f2efbd8dd1_178)] | | |

| [ITEM [removed: 10.](#ibded95f24f424326a39dded243103ee0_196)] [added: 10.](#i8300e37934874469bb7650f2efbd8dd1_184)] | | | [Directors, Executive Officers and Corporate [removed: Governance](#ibded95f24f424326a39dded243103ee0_196)] [added: Governance](#i8300e37934874469bb7650f2efbd8dd1_184)] | | | [removed: [106](#ibded95f24f424326a39dded243103ee0_196)] [added: [108](#i8300e37934874469bb7650f2efbd8dd1_184)] | | |

| [ITEM [removed: 11.](#ibded95f24f424326a39dded243103ee0_199)] [added: 11.](#i8300e37934874469bb7650f2efbd8dd1_187)] | | | [Executive [removed: Compensation](#ibded95f24f424326a39dded243103ee0_199)] [added: Compensation](#i8300e37934874469bb7650f2efbd8dd1_187)] | | | [removed: [106](#ibded95f24f424326a39dded243103ee0_199)] [added: [108](#i8300e37934874469bb7650f2efbd8dd1_187)] | | |

| [ITEM [removed: 12.](#ibded95f24f424326a39dded243103ee0_202)] [added: 12.](#i8300e37934874469bb7650f2efbd8dd1_190)] | | | [Security Ownership of Certain Beneficial Owners and [removed: Management](#ibded95f24f424326a39dded243103ee0_202)] [added: Management](#i8300e37934874469bb7650f2efbd8dd1_190)] [and Related Stockholder [removed: Matters](#ibded95f24f424326a39dded243103ee0_202)] [added: Matters](#i8300e37934874469bb7650f2efbd8dd1_190)] | | | [removed: [106](#ibded95f24f424326a39dded243103ee0_202)] [added: [108](#i8300e37934874469bb7650f2efbd8dd1_190)] | | |

| [ITEM [removed: 13.](#ibded95f24f424326a39dded243103ee0_205)] [added: 13.](#i8300e37934874469bb7650f2efbd8dd1_193)] | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#ibded95f24f424326a39dded243103ee0_205)] [added: Independence](#i8300e37934874469bb7650f2efbd8dd1_193)] | | | [removed: [107](#ibded95f24f424326a39dded243103ee0_205)] [added: [109](#i8300e37934874469bb7650f2efbd8dd1_193)] | | |

| [ITEM [removed: 14.](#ibded95f24f424326a39dded243103ee0_208)] [added: 14.](#i8300e37934874469bb7650f2efbd8dd1_196)] | | | [Principal Accountant Fees and [removed: Services](#ibded95f24f424326a39dded243103ee0_208)] [added: Services](#i8300e37934874469bb7650f2efbd8dd1_196)] | | | [removed: [107](#ibded95f24f424326a39dded243103ee0_208)] [added: [109](#i8300e37934874469bb7650f2efbd8dd1_196)] | | |

| [ITEM [removed: 15.](#ibded95f24f424326a39dded243103ee0_214)] [added: 15.](#i8300e37934874469bb7650f2efbd8dd1_202)] | | | [Exhibits and Financial Statement [removed: Schedules](#ibded95f24f424326a39dded243103ee0_214)] [added: Schedules](#i8300e37934874469bb7650f2efbd8dd1_202)] | | | [removed: [108](#ibded95f24f424326a39dded243103ee0_214)] [added: [110](#i8300e37934874469bb7650f2efbd8dd1_202)] | | |


| [PART I](#i8300e37934874469bb7650f2efbd8dd1_13) | | | | | | | | |

| [PART II](#i8300e37934874469bb7650f2efbd8dd1_34) | | | | | | | | |

| [ITEM 6.](#i8300e37934874469bb7650f2efbd8dd1_40) | | | [\[Reserved\]](#i8300e37934874469bb7650f2efbd8dd1_40) | | | [27](#i8300e37934874469bb7650f2efbd8dd1_40) | | |

| [PART III](#i8300e37934874469bb7650f2efbd8dd1_181) | | | | | | | | |

| [PART IV](#i8300e37934874469bb7650f2efbd8dd1_199) | | | | | | | | |

| [ITEM 16.](#i8300e37934874469bb7650f2efbd8dd1_205) | | | [10-K Summary](#i8300e37934874469bb7650f2efbd8dd1_205) | | | [115](#i8300e37934874469bb7650f2efbd8dd1_205) | | |

| [SIGNATURES](#i8300e37934874469bb7650f2efbd8dd1_208) | | | | | | [116](#i8300e37934874469bb7650f2efbd8dd1_208) | | |

Arlington, Texas 76011

| [PART I](#ibded95f24f424326a39dded243103ee0_13) | | | | | | | | |

| [PART II](#ibded95f24f424326a39dded243103ee0_34) | | | | | | | | |

| [ITEM 6.](#ibded95f24f424326a39dded243103ee0_40) | | | [Selected Financial Data](#ibded95f24f424326a39dded243103ee0_40) | | | [27](#ibded95f24f424326a39dded243103ee0_40) | | |

| [PART III](#ibded95f24f424326a39dded243103ee0_193) | | | | | | | | |

| [PART IV](#ibded95f24f424326a39dded243103ee0_211) | | | | | | | | |

| [ITEM 16.](#ibded95f24f424326a39dded243103ee0_217) | | | [10-K Summary](#ibded95f24f424326a39dded243103ee0_217) | | | [113](#ibded95f24f424326a39dded243103ee0_217) | | |

| [SIGNATURES](#ibded95f24f424326a39dded243103ee0_220) | | | | | | [114](#ibded95f24f424326a39dded243103ee0_220) | | |

Our homebuilding and [removed: Forestar] [added: lot development] operations own inventories of land, lots and homes, and [removed: DHI Communities owns multi-family] [added: our] rental [added: operations own rental] properties that are both completed and under construction as part of the ordinary course of our business.

We also own office buildings totaling approximately [removed: 1.1] [added: 1.3] million square feet, and we lease approximately [removed: 570,000] [added: 530,000] square feet of office space under leases expiring through [removed: February] [added: November] 2026.

These properties are located in our various operating markets to house our homebuilding, [removed: Forestar and] [added: Forestar,] financial services [added: and rental] operating divisions and our regional and corporate offices.

We own ranch land and improvements totaling 93,600 acres, most of which has been owned for [removed: approximately] [added: over] 20 years.

Our common stock is listed on the [removed: New York Stock Exchange (NYSE)] [added: NYSE] under the symbol “DHI.” As of November [removed: 12, 2020,] [added: 11, 2021,] the closing price of our common stock on the NYSE was [removed: $71.42,] [added: $96.36,] and there were approximately [removed: 302] [added: 284] holders of record.

In [removed: November 2020,] [added: October 2021,] our Board of Directors approved a quarterly cash dividend of [removed: $0.20] [added: $0.225] per common share, payable on December [removed: 14, 2020,] [added: 15, 2021,] to stockholders of record on December [removed: 4, 2020.][added: 6, 2021.]

We may repurchase shares of our common stock from time to time pursuant to our $1.0 billion common stock repurchase authorization, which was approved by our Board of Directors effective [removed: July 30, 2019] [added: April 20, 2021,] and [removed: has no expiration date.][added: which replaced our prior $1.0 billion common stock repurchase authorization.]

At September 30, [removed: 2020,] [added: 2021,] our remaining stock repurchase authorization was [removed: $535.3] [added: $546.2] million.

During fiscal years [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018,] [added: 2019,] we did not sell any equity securities that were not registered under the Securities Act of 1933, as amended (Securities Act).

The following graph illustrates the cumulative total stockholder return on D.R. Horton common stock for the last five fiscal years through September 30, [removed: 2020,] [added: 2021,] compared to the S&P 500 Index and the S&P 1500 Homebuilding Index.

The comparison assumes a hypothetical investment in D.R. Horton common stock and in each of the foregoing indices of $100 at September 30, [removed: 2015] [added: 2016] and assumes that all dividends were reinvested.

[removed: ][added: ]

| | | | [removed: 2015] [added: 2016] | | | | | | [removed: 2016] [added: 2017] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | |

The authorization has no expiration date.

During fiscal 2021, we purchased 10.4 million shares of our common stock for $874.0 million.

The following table sets forth information concerning our common stock repurchases during the three months ended September 30, 2021.

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Total Number of Shares Purchased | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | | | | | Approximate Dollar Value of Shares that may yet be Purchased Under the Plans or Programs (In millions) | | |

| July 1, 2021 - July 31, 2021 | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 758.8 | |

| August 1, 2021 - August 31, 2021 | | | 760,204 | | | | | | 93.68 | | | | | | 760,204 | | | | | | 687.6 | | |

| September 1, 2021 - September 30, 2021 | | | 1,579,296 | | | | | | 89.53 | | | | | | 1,579,296 | | | | | | 546.2 | | |

| Total | | | 2,339,500 | | | | | | $ | 90.88 | | | | | 2,339,500 | | | | | | $ | 546.2 | |

| | | | September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| D.R. Horton, Inc. | | | $ | 100.00 | | | | | $ | 133.91 | | | | | $ | 143.01 | | | | | $ | 181.36 | | | | | $ | 263.45 | | | | | $ | 295.26 | |

| S&P 500 Index | | | 100.00 | | | | | | 118.61 | | | | | | 139.85 | | | | | | 145.80 | | | | | | 167.89 | | | | | | 218.26 | | |

| S&P 1500 Homebuilding Index | | | 100.00 | | | | | | 138.42 | | | | | | 130.92 | | | | | | 175.80 | | | | | | 234.15 | | | | | | 262.95 | | |

During fiscal 2020, we purchased 7.0 million shares of our common stock for $360.4 million, none of which were purchased in the three months ended September 30, 2020.

Comparison of Five-Year Cumulative Total Return

Among D.R. Horton, Inc., S&P 500 Index and S&P 1500 Homebuilding Index

| | | | Year Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| D.R. Horton, Inc. | | | $ | 100.00 | | | | | $ | 103.97 | | | | | $ | 139.22 | | | | | $ | 148.68 | | | | | $ | 188.55 | | | | | $ | 273.89 | |

| S&P 500 Index | | | 100.00 | | | | | | 115.43 | | | | | | 136.91 | | | | | | 161.43 | | | | | | 168.30 | | | | | | 193.80 | | |

| S&P 1500 Homebuilding Index | | | 100.00 | | | | | | 99.41 | | | | | | 137.60 | | | | | | 130.15 | | | | | | 174.76 | | | | | | 232.77 | | |

The following selected financial data are derived from our consolidated financial statements and should be read in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” Item 1A, “Risk Factors,” Item 8, “Financial Statements and Supplementary Data,” and all other financial data contained in this annual report on Form 10-K.

These historical results are not necessarily indicative of the results to be expected in the future.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Year Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | 2020 | | | | | | 2019 | | | | | | 2018 | | | | | | 2017 | | | | | | 2016 | | |

| | | | | | | | | | (In millions, except per share data) | | | | | | | | | | | | | | | | | | | | |

| Consolidated Operating Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Revenues | | | $ | 20,311.1 | | | | | $ | 17,592.9 | | | | | $ | 16,068.0 | | | | | $ | 14,091.0 | | | | | $ | 12,157.4 | |

| Cost of sales | | | 15,373.2 | | | | | | 13,720.9 | | | | | | 12,398.1 | | | | | | 11,042.8 | | | | | | 9,502.6 | | |

| Selling, general and administrative expense | | | 2,047.8 | | | | | | 1,832.5 | | | | | | 1,676.8 | | | | | | 1,471.6 | | | | | | 1,320.3 | | |

| Income before income taxes | | | 2,983.0 | | | | | | 2,125.3 | | | | | | 2,060.0 | | | | | | 1,602.1 | | | | | | 1,353.5 | | |

| Income tax expense | | | 602.5 | | | | | | 506.7 | | | | | | 597.7 | | | | | | 563.7 | | | | | | 467.2 | | |

| Net income attributable to D.R. Horton, Inc. | | | 2,373.7 | | | | | | 1,618.5 | | | | | | 1,460.3 | | | | | | 1,038.4 | | | | | | 886.3 | | |

| Net income per common share attributable to D.R. Horton, Inc.: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Basic | | | 6.49 | | | | | | 4.34 | | | | | | 3.88 | | | | | | 2.77 | | | | | | 2.39 | | |

| Diluted | | | 6.41 | | | | | | 4.29 | | | | | | 3.81 | | | | | | 2.74 | | | | | | 2.36 | | |

| Cash dividends declared per common share | | | 0.70 | | | | | | 0.60 | | | | | | 0.50 | | | | | | 0.40 | | | | | | 0.32 | | |

| | | | September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | (In millions) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Consolidated Balance Sheet Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cash and cash equivalents | | | $ | 3,018.5 | | | | | $ | 1,494.3 | | | | | $ | 1,473.1 | | | | | $ | 1,007.8 | | | | | $ | 1,303.2 | |

| Inventories | | | 12,237.4 | | | | | | 11,282.0 | | | | | | 10,395.0 | | | | | | 9,237.1 | | | | | | 8,340.9 | | |

| Total assets | | | 18,912.3 | | | | | | 15,606.6 | | | | | | 14,114.6 | | | | | | 12,184.6 | | | | | | 11,558.9 | | |

| Notes payable | | | 4,283.3 | | | | | | 3,399.4 | | | | | | 3,203.5 | | | | | | 2,871.6 | | | | | | 3,271.3 | | |

| Total liabilities | | | 6,790.8 | | | | | | 5,311.5 | | | | | | 4,955.7 | | | | | | 4,437.0 | | | | | | 4,765.9 | | |

| Stockholders’ equity | | | 11,840.0 | | | | | | 10,020.9 | | | | | | 8,984.4 | | | | | | 7,747.1 | | | | | | 6,792.5 | | |

| Total equity | | | 12,121.5 | | | | | | 10,295.1 | | | | | | 9,158.9 | | | | | | 7,747.6 | | | | | | 6,793.0 | | |

| | | | [added: 2021 | | | | | |] 2020 | | | | | | 2019 | | |

| Cash and cash equivalents | | | $ | [removed: 3,018.5] [added: 3,210.4] | | | | | $ | [removed: 1,494.3] [added: 3,018.5] | |

| Restricted cash | | | [removed: 21.6] [added: 26.8] | | | | | | [removed: 19.7] [added: 21.6] | | |

| Total cash, cash equivalents and restricted cash | | | [removed: 3,040.1] [added: 3,237.2] | | | | | | [removed: 1,514.0] [added: 3,040.1] | | |

| Construction in progress and finished homes | | | [removed: 5,984.1] [added: 7,739.2] | | | | | | [removed: 5,245.0] [added: 5,984.1] | | |

| Residential land and lots — developed and under development | | | [removed: 6,171.8] [added: 7,781.8] | | | | | | [removed: 5,939.4] [added: 6,171.8] | | |

| Land held for development | | | [removed: 53.2] [added: 110.9] | | | | | | [removed: 77.8] [added: 53.2] | | |

| Land held for sale | | | [added: | | |] 28.3 | | | | | | [removed: 19.8] [added: —] | | | [added: | | | — | | | | | | — | | | | | | — | | | | | | 28.3 | | |]

| Total inventory | | | [removed: 12,237.4] [added: 16,479.1] | | | | | | [removed: 11,282.0] [added: 12,237.4] | | |

| Mortgage loans held for sale | | | [added: | | | — | | | | | | — | | | | | |] 1,529.0 | | | | | | [removed: 1,072.0] [added: —] | | | [added: | | | — | | | | | | 1,529.0 | | |]

| Deferred income taxes, net of valuation allowance of [removed: $7.5] [added: $4.2] million and [removed: $18.7] [added: $7.5] million at September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively | | | [removed: 144.9] [added: 155.3] | | | | | | [removed: 163.1] [added: 144.9] | | |

| Property and equipment, net | | | [removed: 683.7] [added: 392.9] | | | | | | [removed: 499.2] [added: 683.7] | | |

| Other assets | | | [removed: 1,113.7] [added: 1,560.6] | | | | | | [removed: 912.8] [added: 1,113.7] | | |

| Total assets | | | $ | [removed: 18,912.3] [added: 24,015.9] | | | | | $ | [removed: 15,606.6] [added: 18,912.3] | |

| Accounts payable | | | $ | [removed: 900.5] [added: 1,177.0] | | | | | $ | [removed: 634.0] [added: 900.5] | |

| Accrued expenses and other liabilities | | | [removed: 1,607.0] [added: 2,210.3] | | | | | | [removed: 1,278.1] [added: 1,607.0] | | |

| Notes payable | | | [removed: 4,283.3] [added: 5,412.4] | | | | | | [removed: 3,399.4] [added: 4,283.3] | | |

| Total liabilities | | | [removed: 6,790.8] [added: 8,799.7] | | | | | | [removed: 5,311.5] [added: 6,790.8] | | |

| Common stock, $.01 par value, 1,000,000,000 shares authorized, [removed: 394,741,349] [added: 397,190,100] shares issued and [removed: 363,999,982] [added: 356,015,843] shares outstanding at September 30, [removed: 2020] [added: 2021] and [removed: 392,172,821] [added: 394,741,349] shares issued and [removed: 368,431,454] [added: 363,999,982] shares outstanding at September 30, [removed: 2019] [added: 2020] | | | [removed: 3.9] [added: 4.0] | | | | | | 3.9 | | |

| Additional paid-in capital | | | [removed: 3,240.9] [added: 3,274.8] | | | | | | [removed: 3,179.1] [added: 3,240.9] | | |

| Retained earnings | | | [removed: 9,757.8] [added: 13,644.3] | | | | | | [removed: 7,640.1] [added: 9,757.8] | | |

| Treasury stock, [removed: 30,741,367] [added: 41,174,257] shares and [removed: 23,741,367] [added: 30,741,367] shares at September 30, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively, at cost | | | [removed: (1,162.6)] [added: (2,036.6)] | | | | | | [removed: (802.2)] [added: (1,162.6)] | | |

| Stockholders’ equity | | | [removed: 11,840.0] [added: 14,886.5] | | | | | | [removed: 10,020.9] [added: 11,840.0] | | |

| Noncontrolling interests | | | [removed: 281.5] [added: 329.7] | | | | | | [removed: 274.2] [added: 281.5] | | |

| Total equity | | | [removed: 12,121.5] [added: 15,216.2] | | | | | | [removed: 10,295.1] [added: 12,121.5] | | |

| Total liabilities and equity | | | $ | [removed: 18,912.3] [added: 24,015.9] | | | | | $ | [removed: 15,606.6] [added: 18,912.3] | |

| | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Revenues | | | $ | [removed: 20,311.1] [added: 27,774.2] | | | | | $ | [removed: 17,592.9] [added: 20,311.1] | | | | | $ | [removed: 16,068.0] [added: 17,592.9] | |

| Cost of sales | | | [removed: 15,373.2] [added: 19,899.2] | | | | | | [removed: 13,720.9] [added: 15,373.2] | | | | | | [removed: 12,398.1] [added: 13,720.9] | | |

| Selling, general and administrative expense | | | [removed: 2,047.8] [added: 2,556.2] | | | | | | [removed: 1,832.5] [added: 2,047.8] | | | | | | [removed: 1,676.8] [added: 1,832.5] | | |

| Equity in earnings of unconsolidated entities | | | [removed: (0.7)] [added: (1.0)] | | | | | | [removed: (0.5)] [added: (0.7)] | | | | | | [removed: (2.8)] [added: —] | | |

| Gain on sale of assets | | | [removed: (59.5)] [added: (14.0)] | | | | | | [removed: (53.9)] [added: (59.5)] | | | | | | [removed: (18.8)] [added: (53.9)] | | |

| Income before income taxes | | | [removed: 2,983.0] [added: 5,356.3] | | | | | | [removed: 2,125.3] [added: 2,983.0] | | | | | | [removed: 2,060.0] [added: 2,125.3] | | |

| Income tax expense | | | [removed: 602.5] [added: 1,165.1] | | | | | | [removed: 506.7] [added: 602.5] | | | | | | [removed: 597.7] [added: 506.7] | | |

| Net income | | | [removed: 2,380.5] [added: 4,191.2] | | | | | | [removed: 1,618.6] [added: 2,380.5] | | | | | | [removed: 1,462.3] [added: 1,618.6] | | |

| Net income attributable to noncontrolling interests | | | [removed: 6.8] [added: 15.4] | | | | | | [removed: 0.1] [added: 6.8] | | | | | | [removed: 2.0] [added: 0.1] | | |

| Net income attributable to D.R. Horton, Inc. | | | $ | [removed: 2,373.7] [added: 4,175.8] | | | | | $ | [removed: 1,618.5] [added: 2,373.7] | | | | | $ | [removed: 1,460.3] [added: 1,618.5] | |

| Basic net income per common share attributable to D.R. Horton, Inc. | | | $ | [removed: 6.49] [added: 11.56] | | | | | $ | [removed: 4.34] [added: 6.49] | | | | | $ | [removed: 3.88] [added: 4.34] | |

| Weighted average number of common shares | | | [removed: 365.5] [added: 361.1] | | | | | | [removed: 372.6] [added: 365.5] | | | | | | [removed: 376.6] [added: 372.6] | | |

| Diluted net income per common share attributable to D.R. Horton, Inc. | | | $ | [removed: 6.41] [added: 11.41] | | | | | $ | [removed: 4.29] [added: 6.41] | | | | | $ | [removed: 3.81] [added: 4.29] | |

| | | | 2021 | | | | | | 2020 | | |

| Rental properties | | | 821.8 | | | | | | — | | |

| Loss on extinguishment of debt | | | 18.1 | | | | | | — | | | | | | — | | |

| Other (income) expense | | | (41.6) | | | | | | (33.4) | | | | | | (31.9) | | |

| Net income | | | — | | | | | | — | | | | | | 4,175.8 | | | | | | — | | | | | | 15.4 | | | | | | 4,191.2 | | |

| Exercise of stock options (757,487 shares) | | | — | | | | | | 6.6 | | | | | | — | | | | | | — | | | | | | — | | | | | | 6.6 | | |

| Change of ownership interest in Forestar | | | — | | | | | | (1.7) | | | | | | — | | | | | | — | | | | | | 32.9 | | | | | | 31.2 | | |

| Balances at September 30, 2021 (356,015,843 shares) | | | $ | 4.0 | | | | | $ | 3,274.8 | | | | | $ | 13,644.3 | | | | | $ | (2,036.6) | | | | | $ | 329.7 | | | | | $ | 15,216.2 | |

| Gain on sale of assets | | | (14.0) | | | | | | (59.5) | | | | | | (53.9) | | |

| Loss on extinguishment of debt | | | 18.1 | | | | | | — | | | | | | — | | |

| Increase in rental properties | | | (303.6) | | | | | | — | | | | | | — | | |

| Other investing activities | | | 2.1 | | | | | | 0.6 | | | | | | 2.1 | | |

| Repurchase of common stock not settled | | | $ | 25.6 | | | | | $ | — | | | | | $ | — | |

During the third quarter of fiscal 2021, the Company changed the presentation of its single and multi-family rental operations in its consolidated financial statements.

Bulk sales of rental properties are now presented as revenues and cost of sales, rental assets previously recorded as property and equipment have been reclassified to inventory, and related cash flows for the single and multi-family rental operations are now included in operating activities.

Prior to the third quarter of fiscal 2021, bulk sales of rental properties were presented on a net basis as a gain on sale of assets, and the majority of the cash flow activities were included in investing activities.

This change in presentation was implemented as a result of the Company’s change in strategic focus during the third quarter of fiscal 2021, which included increased levels of rental property activity during that quarter and plans for future investment in the Company’s single and multi-family rental operations.

This presentation was effected on a prospective basis in the Company’s consolidated financial statements beginning in the third quarter of fiscal 2021.

Additionally, during the fourth quarter of fiscal 2021, the Company changed its internal organization and reporting of its operating segments and reportable segments to combine its single-family rental operations and its multi-family rental operations into a new reporting segment to reflect the method by which the chief operating decision makers manage the business, evaluate internal results and allocate financial resources.

The Company’s single-family rental operations had previously been reported in its homebuilding segment and its multi-family operations had previously been reported in its other segment.

Additionally, the Company realigned the aggregation of its homebuilding operating segments into six new reportable segments to better allocate its homebuilding operating segments across geographic reporting regions.

In the Company’s segment information in Note B and in Management’s Discussion and Analysis of Financial Condition and Results of Operations, the prior presentation has been conformed to the current presentation for all periods presented to be consistent with how management evaluates segment performance.

Forestar’s land and lot sales revenue and related profit are generally recognized at the time of the closing of a sale, when title to and possession of the property are transferred to a third-party buyer.

Forestar’s revenues from land and lot sales to D.R. Horton are eliminated in the consolidated financial statements.

The Company’s rental operations develop, construct, lease, own and ultimately sell multi-family and single-family rental properties.

Revenue is recognized from the sale of these properties on the closing date, which is when performance obligations are satisfied.

Rental income from these properties is recognized as other income.

Development and construction costs incurred related to the rental operations are recorded as rental property inventory.

Cost of sales related to the rental operations include the specific construction costs and all applicable land acquisition, land development and related costs for each rental project.

In October 2020, the Company acquired the homebuilding operations of Braselton Homes in Corpus Christi, Texas for approximately $23.0 million in cash.

The assets acquired included approximately 90 homes in inventory, 95 lots and control of approximately 840 additional lots through purchase contracts.

| | | | 2021 | | | | | | 2020 | | |

| Northwest | | | $ | 2.2 | | | | | $ | 2.2 | |

| Southeast | | | 6.0 | | | | | | 6.0 | | |

| East | | | 60.5 | | | | | | 60.5 | | |

| North | | | 49.7 | | | | | | 49.7 | | |

In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform - Scope,” which clarified the scope and application of the original guidance.

In October 2021, the FASB issued ASU 2021-08, which requires application of ASC 606, “Revenue from Contracts with Customers,” to recognize and measure contract assets and liabilities from contracts with customers acquired in a business combination.

ASU 2021-08 creates an exception to the general recognition and measurement principle in ASC 805 and will result in recognition of contract assets and contract liabilities consistent with those recorded by the acquiree immediately before the acquisition date.

During the fourth quarter of fiscal 2021, the Company changed its internal organization and reporting of its operating segments and reportable segments to combine its single-family rental operations and its multi-family rental operations into a new reporting segment to reflect the method by which the chief operating decision makers manage the business, evaluate internal results and allocate financial resources.

| | | | | | | | | | | | | | | | | | |

| Other (income) expense | | | (32.7) | | | | | | (31.4) | | | | | | (45.3) | | |

| Balances at September 30, 2017 (374,986,079 shares) | | | $ | 3.8 | | | | | $ | 2,992.2 | | | | | $ | 4,946.0 | | | | | $ | (194.9) | | | | | $ | 0.5 | | | | | $ | 7,747.6 | |

| Noncontrolling interest acquired | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 175.2 | | | | | | 175.2 | | |

| Net income | | | — | | | | | | — | | | | | | 1,460.3 | | | | | | — | | | | | | 2.0 | | | | | | 1,462.3 | | |

| Exercise of stock options (2,547,139 shares) | | | 0.1 | | | | | | 43.3 | | | | | | — | | | | | | — | | | | | | — | | | | | | 43.4 | | |

| Distributions of earnings of unconsolidated entities | | | — | | | | | | 0.5 | | | | | | 2.0 | | |

| Return of investment in unconsolidated entities | | | 4.3 | | | | | | 4.4 | | | | | | 17.5 | | |

| Net principal increase of other mortgage loans and real estate owned | | | (3.7) | | | | | | (2.3) | | | | | | (1.2) | | |

| Accrued expenditures for property and equipment | | | $ | 17.3 | | | | | $ | 14.1 | | | | | $ | 10.7 | |

Certain prior period amounts have been reclassified to conform to the current year presentation.

At the beginning of fiscal 2020, the Company reclassified its single-family rental properties from other assets to property and equipment in its homebuilding segment.

Reclassification of the prior period amount resulted in a $37.0 million decrease in other assets with a corresponding increase in property and equipment at September 30, 2019.

This reclassification had no effect on the Company’s consolidated financial position or results of operations.

Adoption of New Accounting Standards

In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, “Leases,” which requires that lease assets and liabilities be recognized on the balance sheet and that key information about leasing arrangements be disclosed.

As a result of the adoption of this standard on October 1, 2019, the Company recorded right of use assets of $39.0 million and lease liabilities of $40.3 million.

Lease right of use assets are included in other assets and lease liabilities are included in accrued expenses and other liabilities in the consolidated balance sheet.

In March 2020, the Securities and Exchange Commission (SEC) adopted amendments to the financial disclosure requirements applicable to registered debt offerings that include credit enhancements, such as subsidiary guarantees, in Rule 3-10 of Regulation S-X.

The amended rule focuses on providing material, relevant and decision-useful information regarding guarantees and other credit enhancements, while eliminating certain prescriptive requirements.

The Company adopted these amendments on March 31, 2020.

Accordingly, summarized financial information has been presented only for the issuers and guarantors of the Company's registered securities for the most recent fiscal year and as permitted, this information is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations.

In October 2020, the FASB issued ASU 2020-09, “Debt (Topic 470) - Amendments to SEC Paragraphs Pursuant to SEC Release No. 33-10762,” to reflect the SEC’s new disclosure rules on guaranteed debt securities offerings adopted by the Company in March 2020.

The Company collects insurance commissions on homeowner policies placed with third party carriers through its 100% owned insurance agency.

The Company recognizes revenue and a contract asset for estimated future renewals of these policies upon issuance of the initial policy, the date at which the performance obligation is satisfied.

At September 30, 2019, there was one variable interest entity reported in the Company’s consolidated balance sheet as a result of the related party transaction described in Note O.

Property under construction is not depreciated until the property is placed in service.

The depreciable lives of single-family rental homes and multi-family rental buildings typically range from 25 to 30 years.

| East | | | $ | 26.4 | | | | | $ | 26.4 | |

| Midwest | | | 49.7 | | | | | | 49.7 | | |

| Southeast | | | 40.1 | | | | | | 40.1 | | |

| West | | | 2.2 | | | | | | 2.2 | | |

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses,” which replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information in determining credit loss estimates.

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other,” which simplifies the measurement of goodwill impairment by removing the second step of the goodwill impairment test that requires the determination of the fair value of individual assets and liabilities of a reporting unit.

Under the new guidance, goodwill impairment is measured as the amount by which a reporting unit’s carrying amount exceeds its fair value with the loss recognized limited to the total amount of goodwill allocated to the reporting unit.

The Company is currently evaluating the impact of this guidance, and it is not expected to have a material impact on its consolidated financial position, results of operations or cash flows.

The homebuilding operating segments are aggregated into the following six reporting segments: East, Midwest, Southeast, South Central, Southwest and West.

These reporting segments have homebuilding operations located in the following states:

| | | | Midwest: | | | | | | Colorado, Illinois, Indiana, Iowa, Minnesota and Ohio | | |

These subsidiaries conduct insurance-related operations, construct and own income-producing multi-family rental properties, own non-residential real estate including ranch land and improvements and own and operate oil and gas related assets.

Based on that evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures as of September 30, [removed: 2020] [added: 2021] were effective in providing reasonable assurance that information required to be disclosed in the reports the Company files, furnishes, submits or otherwise provides the Securities and Exchange Commission (SEC) under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that information required to be disclosed in reports filed by the Company under the Exchange Act is accumulated and communicated to the Company’s management, including the CEO and CFO, in such a manner as to allow timely decisions regarding the required disclosure.

There have been no changes in the Company’s internal controls over financial reporting during the quarter ended September 30, [removed: 2020] [added: 2021] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as of September 30, [removed: 2020.][added: 2021.]

Ernst & Young LLP, an independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting as of September 30, [removed: 2020,] [added: 2021,] as stated in their report included herein.

The information required by this item is set forth under the captions *“Proposal One — Election of Directors,” “Corporate Governance and Board [removed: Matters,”*] [added: Matters”* and] *“Delinquent Section 16(a) [removed: Reports”* and *“Requesting Documents from the Company”*] [added: Reports,”* if applicable,] in the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and incorporated herein by reference.

The information required by this item is set forth under the captions *“Executive Compensation”* and [removed: *“Compensation Committee Interlocks and Insider Participation”*] [added: *“CEO Pay Ratio”*] in the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and incorporated herein by reference.

The following table summarizes our equity compensation plans as of September 30, [removed: 2020.][added: 2021.]

(3)Amount includes [removed: 2,827,731] [added: 2,714,736] shares reserved for issuance under the Company’s Employee Stock Purchase Plan.

Under the Employee Stock Purchase Plan, employees purchased [removed: 131,348] [added: 112,995] shares of common stock in fiscal [removed: 2020.][added: 2021.]

The remaining information required by this item is set forth under the caption *“Beneficial Ownership of Common Stock”* in the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and incorporated herein by reference.

| Equity compensation plans approved by stockholders | | | 6,013,041 | | | (1) | | | | | | $ | 23.84 | | (2) | | | | | | 8,727,777 | | | (3) | | |

| Total | | | 6,013,041 | | | | | | | | | $ | 23.84 | | | | | | | | 8,727,777 | | | | | |

| Equity compensation plans approved by stockholders | | | 8,000,116 | | | (1) | | | | | | $ | 19.94 | | (2) | | | | | | 10,827,847 | | | (3) | | |

| Total | | | 8,000,116 | | | | | | | | | $ | 19.94 | | | | | | | | 10,827,847 | | | | | |

The information required by this item is set forth under the captions *“Certain Relationships and Related Person Transactions”* and *“Corporate Governance and Board Matters”* in the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and incorporated herein by reference.

The information required by this item is set forth under the caption *“Independent Registered Public Accountants”* in the registrant’s definitive Proxy Statement for the [removed: 2021] [added: 2022] Annual Meeting of Stockholders and incorporated herein by reference.

| 2.1 | | | | | | | | | [Agreement and Plan of Merger dated June 29, 2017 by and among the Company, Force Merger Sub, Inc. and Forestar Group Inc. (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form [removed: 8-K dated June 29, 2017, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312517217553/d371231dex21.htm) [](http://www.sec.gov/Archives/edgar/data/882184/000119312517217553/d371231dex21.htm)[filed] with the SEC on June 29, 2017).](http://www.sec.gov/Archives/edgar/data/882184/000119312517217553/d371231dex21.htm) | | |

| 3.2 | | | | | | | | | [Amended and Restated Bylaws (incorporated by reference from Exhibit 3.1 to the Company’s Current Report on Form [removed: 8-K, dated November 2, 2017, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312517337236/d489193dex31.htm) [filed] with the SEC on November 8, 2017).](http://www.sec.gov/Archives/edgar/data/882184/000119312517337236/d489193dex31.htm) | | |

| 4.2 | | | | | | | | | [Senior Debt Securities Indenture, dated as of May 1, 2012, between Company and American Stock Transfer & Trust Company, LLC, as Trustee (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated May 1, 2012, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312512198160/d343547dex41.htm) [filed] with the SEC on May 4, 2012).](http://www.sec.gov/Archives/edgar/data/882184/000119312512198160/d343547dex41.htm) | | |

| 4.3 | | | | | | | | | [Second Supplemental Indenture, dated as of September 14, 2012, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as Trustee, relating to the 4.375% Senior Notes due 2022 issued by the Company (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated September 14, 2012, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312512393218/d412364dex41.htm) [filed] with the SEC on September 17, 2012).](http://www.sec.gov/Archives/edgar/data/882184/000119312512393218/d412364dex41.htm) | | |

| 4.4 | | | | | | | | | [Fourth Supplemental Indenture, dated as of February 5, 2013, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as Trustee, relating to the 4.750% Senior Notes due 2023 issued by the Company (incorporated by reference from Exhibit 4.2 to the Company’s Current Report on Form [removed: 8-K dated February 5, 2013, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312513046290/d484515dex42.htm) [filed] with the SEC on February 8, 2013).](http://www.sec.gov/Archives/edgar/data/882184/000119312513046290/d484515dex42.htm) | | |

| 4.5 | | | | | | | | | [Fifth Supplemental Indenture, dated as of February 5, 2013, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as trustee (incorporated by reference from Exhibit 4.3 to the Company’s Current Report on Form [removed: 8-K dated February 5, 2013, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312513046290/d484515dex43.htm) [filed] with the SEC on February 8, 2013).](http://www.sec.gov/Archives/edgar/data/882184/000119312513046290/d484515dex43.htm) | | |

| 4.6 | | | | | | | | | [Sixth Supplemental Indenture, dated as of August 5, 2013, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as Trustee, relating to the 5.750% Senior Notes Due 2023 issued by the Company (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated August 5, 2013, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312513324904/d581912dex41.htm) [filed] with the SEC on August 8, 2013).](http://www.sec.gov/Archives/edgar/data/882184/000119312513324904/d581912dex41.htm) | | |

| [removed: 4.7] [added: 4.11] | | | | | | | | | [removed: [Ninth] [added: [Second] Supplemental Indenture, dated as of [removed: December] [added: May] 5, [removed: 2017,] [added: 2020,] among the Company, the [removed: Guarantors] [added: guarantors] named [removed: therein, American Stock Transfer & Trust Company, LLC, as original trustee,] [added: therein] and Branch Banking and Trust Company, as [removed: series] trustee, relating to the [removed: 2.550%] [added: 2.600%] Senior Notes Due [removed: 2020] [added: 2025] issued by the Company (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated December 5, 2017, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312520133727/d792024dex41.htm) [filed] with the SEC on [removed: December] [added: May] 5, [removed: 2017).](http://www.sec.gov/Archives/edgar/data/882184/000119312517360835/d367203dex41.htm)] [added: 2020).](http://www.sec.gov/Archives/edgar/data/882184/000119312520133727/d792024dex41.htm)] | | |

| [removed: 4.8] [added: 4.7] | | | | | | | | | [Tenth Supplemental Indenture, dated as of December 5, 2017, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as trustee (incorporated by reference from Exhibit 4.2 to the Company’s Current Report on Form [removed: 8-K dated December 5, 2017, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312517361588/d498980dex42.htm) [filed] with the SEC on December 5, 2017).](http://www.sec.gov/Archives/edgar/data/882184/000119312517361588/d498980dex42.htm) | | |

| [removed: 4.9] [added: 4.8] | | | | | | | | | [Eleventh Supplemental Indenture, dated as of October 10, 2019, among the Company, the guarantors named therein, American Stock Transfer & Trust Company, LLC, as original trustee, and Branch Banking and Trust Company, as series trustee (incorporated by reference from Exhibit 4.3 to the Company’s Current Report on Form [removed: 8-K dated October 10, 2019, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex43.htm) [filed] with the SEC on October 10, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex43.htm) | | |

| [removed: 4.10] [added: 4.15] | | | | | | | | | [Indenture, dated as of April [removed: 12, 2019,] [added: 21, 2021,] by and among Forestar Group Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of Forestar’s Current Report on Form 8-K filed with the SEC on April [removed: 12, 2019).](http://www.sec.gov/Archives/edgar/data/1406587/000119312519105160/d679086dex41.htm)] [added: 21, 2021).](http://www.sec.gov/Archives/edgar/data/1406587/000119312521124943/d147723dex41.htm)] | | |

| [removed: 4.11] [added: 4.9] | | | | | | | | | [Senior Debt Securities Indenture, dated as of October 10, 2019, among the Company and Branch Banking and Trust Company, as trustee (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated October 10, 2019, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex41.htm) [filed] with the SEC on October 10, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex41.htm) | | |

| [removed: 4.12] [added: 4.10] | | | | | | | | | [First Supplemental Indenture, dated as of October 10, 2019, among the Company, the guarantors named therein and Branch Banking and Trust Company, as trustee, relating to the 2.500% Senior Notes Due 2024 issued by the Company (incorporated by reference from Exhibit 4.2 to the Company’s Current Report on Form [removed: 8-K dated October 10, 2019, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex42.htm) [filed] with the SEC on October 10, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000119312519265816/d817968dex42.htm) | | |

| 4.13 | | | | | | | | | [removed: [Second] [added: [Third] Supplemental Indenture, dated as of [removed: May 5,] [added: October 2,] 2020, among the Company, the guarantors named therein and [added: Truist Bank (formerly known as] Branch Banking and Trust [removed: Company,] [added: Company),] as trustee, relating to the [removed: 2.600%] [added: 1.400%] Senior Notes Due [removed: 2025] [added: 2027] issued by the Company (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form [removed: 8-K dated May 5, 2020, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312520262510/d32970dex41.htm) [filed] with the SEC on [removed: May 5, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000119312520133727/d792024dex41.htm)] [added: October 2, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000119312520262510/d32970dex41.htm)] | | |

| [removed: 4.14] [added: 4.12] | | | | | | | | | [Indenture, dated as of February 25, 2020, by and among Forestar Group Inc., the subsidiary guarantors party thereto and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of Forestar’s Current Report on Form 8-K filed with the SEC on February 25, 2020).](http://www.sec.gov/Archives/edgar/data/1406587/000119312520047692/d884928dex41.htm) | | |

| [removed: 4.15] [added: 4.16] | | | | | | | | | [removed: [Third] [added: [Fourth] Supplemental Indenture, dated as of [removed: October 2, 2020,] [added: August 5, 2021,] among [removed: the Company,] [added: D.R. Horton, Inc.,] the guarantors named therein and Truist Bank (formerly known as Branch Banking and Trust Company), as trustee, relating to the [removed: 1.400%] [added: 1.300%] Senior Notes [removed: Due 2027 issued by the Company] [added: due 2026 of D.R. Horton, Inc.] (incorporated by reference [removed: from] [added: to] Exhibit 4.1 [removed: to] [added: of] the Company’s Current Report on Form 8-K [removed: dated October 2, 2020,] filed with the SEC on [removed: October 2, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000119312520262510/d32970dex41.htm)] [added: August 5, 2021).](http://www.sec.gov/Archives/edgar/data/882184/000119312521237701/d201320dex41.htm)] | | |

| [removed: 4.16] [added: 4.14] | | | | | | | | | [Description of Securities (incorporated by reference from Exhibit 4.17 to the Company’s Annual Report on Form 10-K for the year ended September 30, 2019, filed with the SEC on November 25, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000088218419000147/a2019930-10kexhibit417.htm) | | |

| 10.1 | | | | | | | | | [Form of Indemnification Agreement between the Company and each of its [removed: directors](#ibded95f24f424326a39dded243103ee0_1)] [added: directors](#i8300e37934874469bb7650f2efbd8dd1_1)] [and executive officers and schedules of substantially identical documents (incorporated by reference from Exhibit 10.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 1995, filed with the SEC on November 22, 1995 (file number 1-14122); Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998, filed with the SEC on August 6, 1998; and Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2001, filed with the SEC on May 15, 2001).](http://www.sec.gov/Archives/edgar/data/882184/000095013401501950/d87419ex10-4.txt) | | |

| 10.6 | | | † | | | | | | [D.R. Horton, Inc. 2006 Stock Incentive Plan, as amended and restated (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated January 20, 2011, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000095012311005585/d79260exv10w1.htm) [filed] with the SEC on January 26, 2011).](http://www.sec.gov/Archives/edgar/data/882184/000095012311005585/d79260exv10w1.htm) | | |

| 10.7 | | | † | | | | | | [D.R. Horton, Inc. 2006 Stock Incentive Plan, as amended and restated, effective as of December 11, 2014 (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated January 22, 2015, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312515019980/d857731dex101.htm) [filed] with the SEC on January 26, 2015).](http://www.sec.gov/Archives/edgar/data/882184/000119312515019980/d857731dex101.htm) | | |

| 10.10 | | | † | | | | | | [Form of Non-Qualified Stock Option Agreement (Employee-Term Vesting 2008 Form) pursuant to the Company’s 2006 Stock Incentive Plan (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form [removed: 8-K dated February 11, 2008, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312508032689/dex102.htm) [filed] with the SEC on February 15, 2008).](http://www.sec.gov/Archives/edgar/data/882184/000119312508032689/dex102.htm) | | |

| 10.11 | | | † | | | | | | [Form of Non-Qualified Stock Option Agreement (Outside Director-Term Vesting 2008 Form) pursuant to the Company’s 2006 Stock Incentive Plan (incorporated by reference from Exhibit 10.3 to the Company’s Current Report on Form [removed: 8-K dated February 11, 2008, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312508032689/dex103.htm) [filed] with the SEC on February 15, 2008).](http://www.sec.gov/Archives/edgar/data/882184/000119312508032689/dex103.htm) | | |

| 10.12 | | | † | | | | | | [Form of Restricted Stock Unit Agreement pursuant to the Company’s 2006 Stock Incentive Plan (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated September 30, 2010, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000095012310091822/d76661exv10w1.htm) [filed] with the SEC on October 6, 2010).](http://www.sec.gov/Archives/edgar/data/882184/000095012310091822/d76661exv10w1.htm) | | |

| 10.13 | | | † | | | | | | [Form of Restricted Stock Unit Agreement pursuant to the Company’s 2006 Stock Incentive Plan, as amended and restated (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form [removed: 8-K dated November 9, 2011, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312511314518/d256830dex102.htm) [filed] with the SEC on November 16, 2011).](http://www.sec.gov/Archives/edgar/data/882184/000119312511314518/d256830dex102.htm) | | |

| 10.15 | | | † | | | | | | [Form of Restricted Stock Unit Agreement (Employees) pursuant to the Company’s 2006 Stock Incentive Plan, as amended and restated (incorporated by reference from Exhibit 10.4 to the Company’s Current Report on Form [removed: 8-K dated November 5, 2014, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312514409217/d820272dex104.htm) [filed] with the SEC on November 12, 2014).](http://www.sec.gov/Archives/edgar/data/882184/000119312514409217/d820272dex104.htm) | | |

| 10.17 | | | † | | | | | | [Form of Stock Award Agreement pursuant to the Company’s 2006 Stock Incentive Plan (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form [removed: 8-K dated September 30, 2010, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000095012310091822/d76661exv10w2.htm) [filed] with the SEC on October 6, 2010).](http://www.sec.gov/Archives/edgar/data/882184/000095012310091822/d76661exv10w2.htm) | | |

| 10.19 | | | † | | | | | | [D.R. Horton, Inc. Amended and Restated Deferred Compensation Plan (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated December 10, 2008, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000136231008008261/c78340exv10w1.htm) [filed] with the SEC on December 16, 2008).](http://www.sec.gov/Archives/edgar/data/882184/000136231008008261/c78340exv10w1.htm) | | |

| 10.20 | | | † | | | | | | [D.R. Horton, Inc. Amended and Restated Supplemental Executive Retirement Plan No. 2 (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form [removed: 8-K dated December 10, 2008, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000136231008008261/c78340exv10w2.htm) [filed] with the SEC on December 16, 2008).](http://www.sec.gov/Archives/edgar/data/882184/000136231008008261/c78340exv10w2.htm) | | |

| 10.21 | | | † | | | | | | [D.R. Horton, Inc. 2018 Incentive Bonus Plan, dated November 6, 2018 (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated November 6, 2018, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000088218418000112/exhibit1012018incentivebon.htm) [filed] with the SEC on November 9, 2018).](http://www.sec.gov/Archives/edgar/data/882184/000088218418000112/exhibit1012018incentivebon.htm) | | |

| 10.22 | | | † | | | | | | [Summary of Executive Compensation Notification - Chairman, CEO and COO (fiscal [removed: 2020)] [added: 2021)] (incorporated by reference from Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the year ended September 30, [removed: 2019,] [added: 2020,] filed with the SEC on November [removed: 25, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000088218419000147/a2019930-10kexhibit1023.htm)] [added: 20, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1023.htm)] | | |

| 10.23 | | | * † | | | | | | [Summary of Executive Compensation Notification - Chairman, CEO and COO (fiscal [removed: 2021).](https://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1023.htm)] [added: 2022).](https://www.sec.gov/Archives/edgar/data/882184/000088218421000190/a9302021exhibit1023.htm)] | | |

| 10.24 | | | † | | | | | | [Summary of Executive Compensation Notification - Other Executive Officer - CFO (fiscal [removed: 2020)] [added: 2021)] (incorporated by reference from Exhibit 10.25 to the Company’s Annual Report on Form 10-K for the year ended September 30, [removed: 2019,] [added: 2020,] filed with the SEC on November [removed: 25, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000088218419000147/a2019930-10kexhibit1025.htm)] [added: 20, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1025.htm)] | | |

| 10.25 | | | * † | | | | | | [Summary of Executive Compensation Notification - Other Executive Officer - CFO (fiscal [removed: 2021).](https://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1025.htm)] [added: 2022).](https://www.sec.gov/Archives/edgar/data/882184/000088218421000190/a9302021exhibit1025.htm)] | | |

| 10.26 | | | † | | | | | | [Summary of Director, Committee and Chairperson Compensation (fiscal [removed: 2020)] [added: 2021)] (incorporated by reference from Exhibit 10.27 to the Company’s Annual Report on Form 10-K for the year ended September 30, [removed: 2019,] [added: 2020,] filed with the SEC on November [removed: 25, 2019).](http://www.sec.gov/Archives/edgar/data/882184/000088218419000147/a2019930-10kexhibit1027.htm)] [added: 20, 2020).](http://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1027.htm)] | | |

| 10.27 | | | * † | | | | | | [Summary of Director, Committee and Chairperson Compensation (fiscal [removed: 2021).](https://www.sec.gov/Archives/edgar/data/882184/000088218420000143/a9302020exhibit1027.htm)] [added: 202](https://www.sec.gov/Archives/edgar/data/882184/000088218421000190/a9302021exhibit1027.htm)[2](https://www.sec.gov/Archives/edgar/data/882184/000088218421000190/a9302021exhibit1027.htm)[).](https://www.sec.gov/Archives/edgar/data/882184/000088218421000190/a9302021exhibit1027.htm)] | | |

| 10.29 | | | | | | | | | [Credit Agreement, dated September 7, 2012, among the Company, the Lenders named therein and The Royal Bank of Scotland PLC, as Administrative Agent (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated September 7, 2012, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312512386201/d407372dex101.htm) [filed] with the SEC on September 10, 2012).](http://www.sec.gov/Archives/edgar/data/882184/000119312512386201/d407372dex101.htm) | | |

| 10.30 | | | | | | | | | [Amendment No.1 to Credit Agreement, dated November 1, 2012, among the Company, The Royal Bank of Scotland PLC, as Administrative Agent, and the Lenders named therein (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated November 1, 2012, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000119312512451766/d433316dex101.htm) [filed] with the SEC on November 5, 2012).](http://www.sec.gov/Archives/edgar/data/882184/000119312512451766/d433316dex101.htm) | | |

| 10.31 | | | | | | | | | [Amendment No. 2 to Credit Agreement, dated August 8, 2013 by and among the Company, The Royal Bank of Scotland PLC, as Administrative Agent, and the Lenders named therein (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated August 8, 2013, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000088218413000056/exhibit101.htm) [filed] with the SEC on August 13, 2013).](http://www.sec.gov/Archives/edgar/data/882184/000088218413000056/exhibit101.htm) | | |

| 10.32 | | | | | | | | | [Amendment No. 3 to Credit Agreement, dated August 22, 2014 by and among Company, The Royal Bank of Scotland PLC, as Administrative Agent, and the Lenders named therein (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated August 22, 2014, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000088218414000073/a3rdamend-exh101.htm) [filed] with the SEC on August 25, 2014).](http://www.sec.gov/Archives/edgar/data/882184/000088218414000073/a3rdamend-exh101.htm) | | |

| 10.33 | | | | | | | | | [Amendment No. 5 to Credit Agreement, dated August 26, 2015 by and among Company, Mizuho Bank, Ltd., as successor Administrative Agent, and the Lenders named therein (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form [removed: 8-K dated August 26, 2015, filed] [added: 8-K](http://www.sec.gov/Archives/edgar/data/882184/000088218415000069/a5thamend-exh101.htm) [filed] with the SEC on August 27, 2015).](http://www.sec.gov/Archives/edgar/data/882184/000088218415000069/a5thamend-exh101.htm) | | |