Forestar Group Inc. — Director's Dealing 2010

Feb 3, 2010

SEC Form 4 — Statement of Changes in Beneficial Ownership

Issuer: Forestar Group Inc. (FOR)
CIK: 0001406587
Period of Report: 2010-02-02

Reporting Person: Etheredge Charles T JR (Executive Vice President)

Non-Derivative Transactions

Date	Security	Code	Shares	Price	A/D	Holdings After	Ownership
2010-02-02	Common Stock	M	700	$18.84	Acquired	17536	Direct
2010-02-02	Common Stock	D	700	$18.84	Disposed	16836	Direct

Derivative Transactions

Date	Security	Exercise Price	Code	Shares	A/D	Expiration	Underlying	Ownership
2010-02-02	Restricted Share Units	$	M	700	Disposed		Common Stock (700)	Direct

Holdings (Derivative)

Security	Exercise Price	Expiration	Underlying	Shares	Ownership
Option (right to buy)	$13.26	2012-02-01	Common Stock (166)	166	Direct
Option (right to buy)	$8.68	2013-02-07	Common Stock (1000)	1000	Direct
Option (right to buy)	$15.02	2014-02-06	Common Stock (533)	533	Direct
Option (right to buy)	$20.26	2015-02-04	Common Stock (533)	533	Direct
Option (right to buy)	$27.06	2016-02-03	Common Stock (1708)	1708	Direct
Option (right to buy)	$30.56	2017-02-02	Common Stock (1708)	1708	Direct
Option (right to buy)	$28.85	2018-02-12	Common Stock (42800)	42800	Direct
Option (right to buy)	$9.29	2019-02-10	Common Stock (14162)	14162	Direct
Stock Appreciation Right	$9.29	2019-02-10	Common Stock (31523)	31523	Direct
Restricted Share Units	$		Common Stock (9688)	9688	Direct

Footnotes

F1: Restricted share units vested on 2/2/2010; payable in cash based on the fair market value on vesting date.

F2: In accordance with the Rights Agreement adopted by the Company on December 11, 2007, Preferred Stock Purchase Rights are deemed to be attached to the shares of Common Stock.

F3: Options Vesting Schedule - Exercise price is $13.26: Options Exercisable 02/01/2006 - 166.

F4: Shares acquired in a pro rata distribution by Temple-Inland Inc. through a spin-off on or around December 28, 2007.

F5: Options Vesting Schedule - Exercise price is $8.68: Options Exercisable 02/07/2006 - 1,000.

F6: Options Vesting Schedule - Exercise price of $15.02: Options Exercisable 02/06/2007 - 400; Options Exercisable 02/06/2008 - 133.

F7: Options Vesting Schedule - Exercise price of $20.26: Options Exercisable 02/04/2007 - 266; Options Exercisable 02/04/2008 - 133; Options Exercisable 02/04/2009 - 134.

F8: Options Vesting Schedule - Exercise price of $27.06: Options Exercisable 02/03/2007 - 427; Options Exercisable 02/03/2008 - 427; Options Exercisable 02/03/2009 - 427; and Options Exercisable 02/03/2010 - 427.

F9: Options Vesting Schedule - Exercise price of $30.56: Options Exercisable 02/02/2008 - 427; Options Exercisable 02/02/2009 - 427; Options Exercisable 02/02/2010 - 427; Options Exercisable 02/02/2011 - 427.

F10: Options Vesting Schedule for Options Granted 02/12/2008 - Exercise price is $28.85: Options Exercisable 02/12/2009 - 10,700; Options Exercisable 02/12/2010 - 10,700; Options Exercisable 02/12/2011 - 10,700; Options Exercisable 02/12/2012 - 10,700.

F11: Vesting schedule for Options granted 02/10/2009 - Exercise price is $9.29: Options Exercisable 02/10/2010 - 3,540; Options Exercisable 02/10/2011 - 3,540; Options Exercisable 02/10/2012 - 3,541; and Options Exercisable 02/10/2013 - 3,541.

F12: Vesting schedule for Stock Appreciation Rights (SARs) granted 02/10/2009 - Exercise price is $9.29: SARs Exercisable 02/10/2010 - 7,880; SARs Exercisable 02/10/2011 - 7,881; SARs Exercisable 02/10/2012 - 7,881; and SARs Exercisable 02/10/2013 - 7,881.

F13: Restricted share units will vest effective 02/02/2010. Restricted share units will be settled for cash based on the fair market value on the vesting date.

F14: Restricted share units granted on 2/10/2009 will vest effective 2/10/2012. Restricted share units will be settled for cash based on the fair market value on the vesting date subject to a 1% ROA performance criteria.