Edgar Filing: SCHULER HOMES INC

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
13D-1(a) AND AMENDMENTS THERETO FILED
PURSUANT TO RULE 13d-2(a)
(AMENDMENT NO. )(1)
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Schuler Homes, Inc.
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(Name of Issuer)

Class A Common Stock, par value $.001 per share
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(Title of Class of Securities)

808188 10 6
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(CUSIP Number)

Paul W. Buchschacher, Esq.
D.R. Horton, Inc.
1901 Ascension Blvd., Suite 100
Arlington, TX 76006
(817) 856-8200
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

October 22, 2001
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(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].

Note: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits. See
Rule 13d-7(b) for other parties to whom copies are to be sent.

(Continued on following pages)

Page 1 of 11 Pages

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(1) The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the subject class
of securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).

SEC 1746 (02-06-98)

CUSIP No. 808188 10 6 13D Page 2 of 11 Pages

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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

D.R. Horton, Inc.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
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3 SEC USE ONLY

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4 SOURCE OF FUNDS*

BK, WC, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [X]

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6 CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware
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7 SOLE VOTING POWER

10
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NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 5,216,914 (1)(2)
OWNED BY ---------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON
WITH 10
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10 SHARED DISPOSITIVE POWER

-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

5,216,924 (1)(2)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]

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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

23.8%
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14 TYPE OF REPORTING PERSON*

CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!

(1) D.R. Horton, Inc. has entered into a Voting Agreement, dated as of October
22, 2001, with certain stockholders of Schuler Homes, Inc., pursuant to which
such stockholders have agreed to vote shares of Class A and Class B Common Stock
of Schuler Homes, Inc. in favor of a proposal to approve and adopt the Merger
Agreement (as defined below). D.R. Horton, Inc. does not have any rights as a
stockholder of Schuler Homes, Inc. pursuant to such Voting Agreement, except
pursuant to the proxy granted thereby. Accordingly, D.R. Horton, Inc. expressly
disclaims beneficial ownership of all shares subject to such Voting Agreement.

(2) Class A Common Stock; does not include shares of Class B Common Stock
because these are not registered under Sections 12(b) or 12(g) of the Securities
Exchange Act of 1934.

CUSIP No. 808188 10 6 13D Page 3 of 11 Pages

This Schedule 13D is filed by D.R. Horton, Inc. ("D.R. Horton" or the
"Reporting Person") to report the Reporting Person's agreement with James K.
Schuler and WPH-Schuler, LLC (and its members) (collectively, the "Schuler
Stockholders"), pursuant to which the Schuler Stockholders have agreed to vote
the shares of Class A and Class B common stock of Schuler Homes, Inc. ("Schuler
Homes") described herein in favor of the proposed merger of Schuler Homes with
and into D.R. Horton (the "Merger").

Item 1. Security and Issuer.

(a) Name of Issuer: Schuler Homes, Inc.

(b) Title of Class of Securities: Class A Common Stock, par value
$.001 per share

Item 2. Identity and Background.

This Schedule 13D is filed by D.R. Horton, Inc., a Delaware
corporation. The address of the principal executive office of D.R. Horton is
1901 Ascension Blvd., Suite 100, Arlington, Texas 76006. D.R. Horton is a
national homebuilder engaged in constructing and selling single-family homes in
metropolitan areas of the Mid-Atlantic, Midwest, Southeast, Southwest and West
regions of the United States.

To the best of D.R. Horton's knowledge as of the date hereof, the name,
business address, present principal occupation or employment and citizenship of
each executive officer and director of D.R. Horton, and the name, principal
business and address of any corporation or other organization in which such
employment is conducted is set forth in Schedule I hereto. The information
contained in Schedule I is incorporated herein by reference.

During the last five years, neither D.R. Horton nor, except as provided
in Schedule I hereto, to the best of D.R. Horton's knowledge, any of the
executive officers or directors of D.R. Horton listed in Schedule I hereto, has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or has been a party to a civil proceeding or a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violation of, or prohibiting or mandating activities subject to, Federal or
state securities laws or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

On October 22, 2001, D.R. Horton entered into a Voting Agreement, dated
as of October 22, 2001 (the "Voting Agreement") with James K. Schuler and
WPH-Schuler, LLC (and its members). No funds or consideration were involved in
the Voting Agreement, except that the Voting Agreement was a condition for D.R.
Horton to enter into the Merger Agreement (defined below).

CUSIP No. 808188 10 6 13D Page 4 of 11 Pages

On October 22, 2001, D.R. Horton and Schuler Homes entered into an
Agreement and Plan of Merger, dated as of October 22, 2001 (the "Merger
Agreement"), which provides that D.R. Horton acquire Schuler Homes by means of a
merger of Schuler Homes with and into D.R. Horton (the "Merger"), with D.R.
Horton as the surviving corporation. Under the Merger Agreement, subject to the
adjustments, elections and limitations described in the Merger Agreement, if the
Merger is completed, each share of Schuler Homes Class A and Class B common
stock outstanding immediately prior to the effective time of the Merger will be
converted into the right to receive a combination of cash and D.R. Horton's
common stock or, at such stockholder's election and subject to the limitations
and prorations stated in the Merger Agreement, cash or shares of D.R. Horton's
common stock. In the Merger, Schuler Homes stockholders will be entitled to
receive $4.09 in cash plus a fraction of a share of D.R. Horton common stock
equal to an exchange ratio based on the average price of D.R. Horton common
stock. The aggregate amount of cash consideration is currently estimated to be
approximately $166,321,000. It is currently anticipated that the cash component
of the Merger consideration, together with any required refinancing of the debt
of Schuler Homes in connection with the Merger, will be funded from D.R.
Horton's working capital and borrowings under its revolving credit facility,
which is included as Exhibit 3 to this Schedule 13D. However, D.R. Horton
reserves the right to obtain such additional sources of financing as it
considers advisable. The outstanding debt of Schuler Homes that may need to be
refinanced in connection with the Merger is estimated to be approximately
$552,000,000.

The foregoing descriptions of the Voting Agreement and the Merger
Agreement are qualified in their entirety by reference to such agreements, each
of which have been filed as exhibits to this Schedule 13D and incorporated
herein by reference.

Item 4. Purpose of Transaction.

The information set forth or incorporated by reference in Items 2 and 3
is hereby incorporated by reference.

The purpose of the Voting Agreement is to facilitate the consummation
of the transactions contemplated by the Merger Agreement. In order to approve
and adopt the Merger Agreement, the certificate of incorporation of Schuler
Homes requires the affirmative vote of the holders of a majority of the
outstanding shares of Class A and Class B common stock, voting as separate
classes, as well as the affirmative vote of a majority of the outstanding shares
of common stock, voting together as a single class with the holders of Class A
common stock entitled to one vote per share and the holders of Class B common
stock entitled to one-half vote per share. Under the Voting Agreement, Mr.
Schuler agreed to vote, and granted an irrevocable proxy for the term of the
Voting Agreement to D.R. Horton with respect to, 5,216,914 of the 10,433,828
shares of Class A common stock beneficially owned by him in favor the Merger and
the Merger Agreement and against any proposal for a Third Party Acquisition (as
defined therein) and against certain other proposals. In addition, WPH-Schuler,
LLC (and its members Apollo Real Estate Investment Fund, L.P., Highridge Pacific
Housing Investors, L.P., and Blackacre WPH, LLC) agreed to vote, and granted an
irrevocable proxy for the term of the Voting Agreement to D.R. Horton with
respect to, all 18,754,727 shares of Class B common stock, par value $.001 per
share, of Schuler Homes held by WPH-Schuler, LLC in favor of the Merger and the
Merger Agreement and against any proposal for a Third Party Acquisition and
against certain other proposals. The shares subject to the Voting Agreement
represent approximately 23.8% of the outstanding shares of Class A common stock,
100% of the outstanding shares of Class B common stock and 46.9% of the combined
voting power of the Class A and Class B common stock voting together as a single
class. Further, under the Voting Agreement and during the term of the

CUSIP No. 808188 10 6 13D Page 5 of 11 Pages

Voting Agreement, Mr. Schuler and WPH-Schuler, LLC may not transfer, sell,
assign, gift, pledge, hypothecate or dispose, whether directly or indirectly by
contribution, distribution, dissolution or otherwise, any of the shares of
Schuler Homes Class A and Class B common stock subject to the Voting Agreement,
except that Mr. Schuler would be permitted to transfer shares of Class A common
stock to his affiliates who are subject to the Voting Agreement and transfers of
membership interests in WPH-Schuler, LLC to its members or their affiliates will
be deemed not to be a transfer of the shares of Class B common stock held by
WPH-Schuler, LLC. The Voting Agreement provides that it will terminate on the
earlier of (a) the effective time of the Merger, (b) termination of the Merger
Agreement according to its terms or (c) the written mutual consent of the
parties thereto.

Upon consummation of the Merger, (a) the certificate of incorporation
and the bylaws of the D.R. Horton will be the certificate of incorporation and
bylaws of the surviving corporation, (b) the directors of D.R. Horton will be
the directors of the surviving corporation and (c) the officers of D.R. Horton
will be the officers of the surviving corporation. The Merger Agreement provides
that D.R. Horton will use its best efforts to elect Mr. Schuler to the board of
directors and, contemporaneous with the signing of the Merger Agreement, D.R.
Horton entered into agreements with Mr. Schuler and Craig A. Manchester,
Executive Vice President and Chief Operating Officer of Schuler Homes, providing
that, upon consummation of the Merger, Mr. Schuler will become a Senior Vice
President of D.R. Horton and President of its Schuler Homes region and Mr.
Manchester will become a Vice President of D.R. Horton and Chief Operating
Officer of its Schuler Homes region.

D.R. Horton does not have any right to dispose of (or the direct the
disposition of) the shares of Schuler Homes Class A or Class B common stock
subject to the Voting Agreement. Accordingly, D.R. Horton expressly disclaims
beneficial ownership of all such shares.

The foregoing description of the Voting Agreement is qualified in its
entirety by reference to such agreement, which has been filed as an exhibit to
this Schedule 13D and incorporated herein by reference.

Item 5. Interest In Securities Of The Issuer.

The information set forth or incorporated by reference in Items 2, 3
and 4 is hereby incorporated by reference.

The aggregate number of shares of Schuler Homes Class A common stock
covered by the Voting Agreement is 5,216,914, representing approximately 23.8%
of the shares of Schuler Homes Class A common stock outstanding as of October
22, 2001, based on the representations of Schuler Homes contained in the Merger
Agreement. The aggregate number of shares of Schuler Homes Class B common stock
covered by the Voting Agreement is 18,754,727, representing 100% of the shares
of Schuler Homes Class B common stock outstanding as of October 22, 2001, as
represented by Schuler Homes in the Merger Agreement. The shares of Class A and
Class B common stock covered by the Voting Agreement also represent 46.9% of the
combined voting power of the Class A and Class B common stock. The names and
business addresses of the parties to the Voting Agreement and the number of
outstanding shares of Schuler Homes Class A and Class B common stock held by
each such party (beneficially and of record) and subject to the Voting Agreement
are also set forth on Schedule I thereto and are incorporated herein by
reference. Mr. Schuler is the Chairman, President and Chief Executive Officer of
Schuler Homes. WPH-Schuler, LLC is a Delaware limited liability company formed
to hold the shares of Schuler Homes Class B common stock on behalf of its
members, as listed on Schedule I

CUSIP No. 808188 10 6 13D Page 6 of 11 Pages

to the Voting Agreement. To the best of D.R. Horton's knowledge, during the last
five years, none of the parties to the Voting Agreement have been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
have been a party to any civil proceeding of a judicial or administrative body
of competent jurisdiction that, as a result of such proceeding, subjected
Schuler Homes to a judgment, decree or final order enjoining Schuler Homes from
future violations of, or prohibiting or mandating activities subject to, Federal
or state securities laws or finding any violations with respect to such laws.

By virtue of the Voting Agreement and the proxy granted thereby, during
the term of the Voting Agreement, D.R. Horton may be deemed to share with the
Schuler Stockholders the power to vote, and to have the power to restrict the
Schuler Stockholders' disposition of, the shares of Schuler Homes Class A and
Class B common stock subject to the Voting Agreement. D.R. Horton, however, is
not entitled to any other rights as a stockholder of Schuler Homes as to the
shares of Schuler Homes Class A and Class B common stock covered by the Voting
Agreement and expressly disclaims any beneficial ownership of the shares of
Schuler Homes Class A and Class B common stock subject to the Voting Agreement.

D.R. Horton beneficially owns 10 shares of Schuler Homes Class A common
stock. Other than as set forth in this Schedule 13D, to the best of D.R.
Horton's knowledge, as of the date hereof, (i) neither D.R. Horton nor any
subsidiary or affiliate of D.R. Horton nor any of D.R. Horton's executive
officers or directors, beneficially owns any shares of Schuler Homes Class A or
Class B common stock and (ii) there have been no transactions in the shares of
Schuler Homes Class A or Class B common stock effected during the past 60 days
by D.R. Horton, nor to the best of D.R. Horton's knowledge, by any subsidiary or
affiliate of D.R. Horton or any of D.R. Horton's executive officers or
directors.

References to the Voting Agreement are qualified in its entirety by
reference to such agreement, which has been filed as an exhibit to this Schedule
13D and incorporated herein by reference.

Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect To Securities of the Issuer.

Except as described elsewhere in this Schedule 13D, D.R. Horton has no
other contract, arrangement, understanding or relationship (legal or otherwise)
with any person with respect to any securities of Schuler Homes, including but
not limited to transfer or voting of any of the securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of profits,
division of profits or losses, or the giving or withholding of proxies.

Item 7. Materials to be Filed as Exhibits.

Exhibit 1 Agreement and Plan of Merger, dated as of October 22, 2001,
between D.R. Horton, Inc. and Schuler Homes, Inc.
(incorporated by reference from Exhibit 2.1 to D.R. Horton's
Current Report on Form 8-K, dated as of October 22, 2001,
filed with the Commission on October 24, 2001).

Exhibit 2 Voting Agreement, dated as of October 22, 2001, among the
Reporting Person, James K. Schuler, WPH-Schuler, LLC and the
other signatories thereto.

CUSIP No. 808188 10 6 13D Page 7 of 11 Pages

Exhibit 3 Amended and Restated Master Loan and Inter-Creditor
Agreement dated as of July 1, 1999, among D.R. Horton, Inc.,
as Borrower; NationsBank, N.A., Fleet National Bank, Bank
United, Comerica Bank, Credit Lyonnais New York Branch,
Societe Generale, Southwest Agency, The First National Bank of
Chicago, PNC Bank, National Association, Amsouth Bank, Bank
One, Arizona, NA, First American Bank Texas, SSB, Harris Trust
and Savings Bank, Sanwa Bank California, Norwest Bank Arizona,
National Association, Wachovia Mortgage Company and Summit
Bank, as Banks; and NationsBank, N.A., as Administrative Agent
(incorporated by reference from Exhibit 10.21 to D.R. Horton's
Annual Report on Form 10-K for the fiscal year ended September
30, 2000, filed with the Commission on December 10, 1999).

CUSIP No. 808188 10 6 13D Page 8 of 11 Pages

SIGNATURE

After reasonable inquiry and to the best of its knowledge and
belief, the undersigned certify that the information set forth in this statement
is true, complete and correct.

Dated: October 31, 2001 D.R. HORTON, INC.

By: /s/ SAMUEL R. FULLER
----------------------------------------
Samuel R. Fuller
Executive Vice President, Treasurer
and Chief Financial Officer

CUSIP No. 808188 10 6 13D Page 9 of 11 Pages

SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF D.R. HORTON, INC.

The following table sets forth the name, business address and present principal
occupation or employment of each director and executive officer of D.R. Horton,
Inc. Each such person is a U.S. citizen and the business address of each such
person is 1901 Ascension Blvd., Suite 100, Arlington, Texas 76006.

Name and Title Present Principal Occupation
-------------- ----------------------------

Donald R. Horton Chairman of the Board, D.R. Horton, Inc.
Chairman of the Board

Donald J. Tomnitz Vice Chairman, President and Chief Executive Officer, D.R. Horton,
Vice Chairman, President and Chief Executive Inc.
Officer

Bradley S. Anderson Mr. Anderson is a Senior Vice President of CB Richard Ellis, Inc.,
Director an international real estate brokerage company

Richard Beckwitt Owner and principal of EVP Capital, L.P.
Director

Samuel R. Fuller Executive Vice President, Treasurer and Chief Financial Officer,
Director, Executive Vice President, Treasurer D.R. Horton, Inc.
and Chief Financial Officer

Richard I. Galland Mr. Galland is an attorney and a director of Associated Materials,
Director Inc.

Richard L. Horton Retired
Director

Terrill J. Horton Retired
Director

Francine I. Neff Ms. Neff is a Vice President of NETS, Inc., a privately-owned
Director investment company, and a partner in EVEN Resources, a
privately-owned consulting service and investment company

CUSIP No. 808188 10 6 13D Page 10 of 11 Pages

Name and Title Present Principal Occupation
-------------- ----------------------------

Scott J. Stone Vice President, D.R. Horton, Inc.
Director

Stacey H. Dwyer Executive Vice President, D.R. Horton, Inc.
Executive Vice President

On November 14, 1996, Mr. Beckwitt settled an investigation by the Securities
and Exchange Commission in connection with his purchase of stock in an
unaffiliated corporation in September 1994. Without admitting or denying the
allegations, Mr. Beckwitt consented to a final judgment announced that day
enjoining him from violating Sections 10(b) and 14(e) of the Securities Exchange
Act of 1934 and rules 10b-5 and 14e-3 thereunder, and providing for his payment
of the alleged profit and a civil penalty. Mr. Beckwitt advised D.R. Horton that
he believed that it was in his best interest to resolve the matter without
litigation in order to avoid additional cost and distraction.

CUSIP No. 808188 10 6 13D Page 11 of 11 Pages

EXHIBIT INDEX

Exhibit 2 Voting Agreement, dated as of October 22, 2001, among the
Reporting Person, James K. Schuler, WPH-Schuler, LLC and the
other signatories thereto.