BETWEEN

1
EXHIBIT 4.7

--------------------------------------------------------------------------------

GUARANTEE AGREEMENT

BETWEEN

TEXAS INDUSTRIES, INC.

(AS GUARANTOR)

AND

---------------------
(AS TRUSTEE)

DATED AS OR

__________, 1998

--------------------------------------------------------------------------------

CROSS-REFERENCE TABLE*

Section of Section of
Trust Indenture Act Guarantee Agreement
Of 1939, as amended -------------------
-------------------

310(a)....................................................................... 4.1(a)
310(b)....................................................................... 4.1(c), 2.8
310(c)....................................................................... Inapplicable
311(a)....................................................................... 2.2(b)
311(b)....................................................................... 2.2(b)
311(c)....................................................................... Inapplicable
312(a)....................................................................... 2.2(a)
312(b)....................................................................... 2.2(b)
313.......................................................................... 2.3
314(a)....................................................................... 2.4
314(b)....................................................................... Inapplicable
314(c)....................................................................... 2.5
314(d)....................................................................... Inapplicable
314(e)....................................................................... 1.1, 2.5, 3.2
314(f)....................................................................... 2.1, 3.2
315(a)....................................................................... 3.1(d)
315(b)....................................................................... 2.7
315(c)....................................................................... 3.1
315(d)....................................................................... 3.1(d)
316(a)....................................................................... 1.1, 2.6, 5.4
316(b)....................................................................... 5.3
316(c)....................................................................... 8.2
317(a)....................................................................... Inapplicable
317(b)....................................................................... Inapplicable
318(a)....................................................................... 2.1(b)
318(b)....................................................................... 2.1
318(c)....................................................................... 2.1(a)

* This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms
or provisions.

TABLE OF CONTENTS

PAGE
----

ARTICLE I. DEFINITIONS........................................................................................... 1

SECTION 1.1. Definitions............................................................................... 1

ARTICLE II. TRUST INDENTURE ACT.................................................................................. 3

SECTION 2.1. Trust Indenture Act; Application.......................................................... 3
SECTION 2.2. List of Holders........................................................................... 4
SECTION 2.3. Reports by Guarantee Trustee.............................................................. 4
SECTION 2.4. Periodic Reports to Guarantee Trustee..................................................... 4
SECTION 2.5. Evidence of Compliance with Conditions Precedent.......................................... 4
SECTION 2.6. Events of Default; Waiver................................................................. 5
SECTION 2.7. Event of Default; Notice.................................................................. 5
SECTION 2.8. Conflicting Interests..................................................................... 5

ARTICLE III. POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE...................................................... 5

SECTION 3.1. Powers and Duties of Guarantee Trustee.................................................... 5
SECTION 3.2. Certain Rights of Guarantee Trustee....................................................... 7
SECTION 3.3. Indemnity................................................................................. 8

ARTICLE IV. GUARANTEE TRUSTEE.................................................................................... 8

SECTION 4.1. Guarantee Trustee: Eligibility........................................................... 8
SECTION 4.2. Appointment, Removal and Resignation of Guarantee Trustee................................. 9

ARTICLE V. GUARANTEE............................................................................................. 10
SECTION 5.1. Guarantee................................................................................. 10
SECTION 5.2. Waiver of Notice and Demand............................................................... 10
SECTION 5.3. Obligations Not Affected.................................................................. 10
SECTION 5.4. Rights of Holders......................................................................... 11
SECTION 5.5. Guarantee of Payment...................................................................... 11
SECTION 5.6. Subrogation............................................................................... 11
SECTION 5.7. Independent Obligations................................................................... 11

ARTICLE VI. SUBORDINATION........................................................................................ 12

SECTION 6.1. Subordination............................................................................. 12

ARTICLE VII. TERMINATION......................................................................................... 12

SECTION 7.1. Termination............................................................................... 12

i
4

ARTICLE VIII. MISCELLANEOUS...................................................................................... 12

SECTION 8.1. Successors and Assign..................................................................... 12
SECTION 8.2. Amendments................................................................................ 12
SECTION 8.3. Notice.................................................................................... 13
SECTION 8.4. Benefit................................................................................... 13
SECTION 8.5. Interpretation............................................................................ 13
SECTION 8.6. Governing Law............................................................................. 14
SECTION 8.7. Counterparts.............................................................................. 14

ii
5

GUARANTEE AGREEMENT

THIS GUARANTEE AGREEMENT, dated as of _________________, 1998, is
executed and delivered by TEXAS INDUSTRIES, INC., a Delaware corporation (the
"Guarantor"), having its principal office at 0000 Xxxx Xxxxxxxxxxx Xxxx, Xxxxxx,
Xxxxx 00000-0000, and ____________________, a ____________________ corporation,
as trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Capital Securities and Common Securities (each
as defined herein and together, the "Securities") of TXI CAPITAL TRUST I, a
Delaware statutory business trust (the "Issuer").

WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as
of ____________________, 1998 (the "Trust Agreement"), among the Guarantor, as
Depositor, the Property Trustee and the Delaware Trustee named therein, the
Administrative Trustees named therein and the Holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing $____________ aggregate Liquidation Amount (as defined in the Trust
Agreement) of its __________% Convertible Trust Preferred Securities,
Liquidation Amount $25 per security (the "Capital Securities"), representing
preferred undivided beneficial interests in the assets of the Issuer and having
the terms set forth in the Trust Agreement;

WHEREAS, the Capital Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Common
Securities of the Issuer, will be used to purchase the Debentures (as defined in
the Trust Agreement) of the Guarantor which will be deposited with
____________________, as Property Trustee under the Trust Agreement, as trust
assets; and

WHEREAS, as incentive for the Holders to purchase Securities, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth herein, to pay to the Holders of the Securities the Guarantee Payments (as
defined herein) and to make certain other payments on the terms and conditions
set forth herein.

NOW, THEREFORE, in consideration of the purchase by each Holder of
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders from time to time of the Securities.

ARTICLE I. DEFINITIONS

SECTION 1. 1. Definitions. As used in this Guarantee Agreement, the
terms set forth below shall, unless the context otherwise requires, have the
following meanings. Capitalized or otherwise defined terms used but not
otherwise defined herein shall have the meanings assigned to such terms in the
Trust Agreement as in effect on the date hereof.

"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; provided, however, that an Affiliate of the
Guarantor shall not be deemed to be an

Affiliate of the Issuer. For the purposes of this definition, "control" when
used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.

"Board of Directors" means either the board of directors of the
Guarantor or any committee of that board duly authorized to act hereunder or any
directors or officers of the Guarantor to whom such board of directors or such
committee shall have duly delegated its authority.

"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.

"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement; provided, however,
that, except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 90 days after receipt of such notice.

"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions
required to be paid on the Securities, to the extent that the Issuer shall have
funds on hand available therefor at such time, (ii) the redemption price,
including all accrued and unpaid Distributions to the date of redemption (the
"Redemption Price"), with respect to any Securities called for redemption by the
Issuer, to the extent the Issuer shall have funds on hand available therefor at
such time and (iii) upon a voluntary or involuntary termination, winding up or
liquidation of the Issuer, unless Debentures are distributed to the Holders, the
lesser of (a) the aggregate of the Liquidation Amount plus accrued and unpaid
Distributions to the date of payment and (b) the amount of assets of the Issuer
remaining available for distribution to Holders in liquidation of the Issuer
after satisfaction of liabilities to creditors of the Issuer as required by
applicable law (in either case, the "Liquidation Distribution").

"Guarantee Trustee" means ____________________, until a Successor
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Guarantee Agreement, and thereafter means each such
Successor Guarantee Trustee.

"Holder" means any holder, as registered on the books and records of
the Issuer, of any Securities; provided, however, that in determining whether
the holders of the requisite percentage of Securities have given any request,
notice, consent or waiver hereunder, "Holder" shall not include the Guarantor,
the Guarantee Trustee or any Affiliate of the Guarantor or the Guarantee
Trustee.

"Indenture" means the Indenture dated as of ____________, 1993, between
the Guarantor and ______________________, as trustee.

2
7

"Majority in Aggregate Liquidation Amount of the Securities" means,
except as provided by the Trust Indenture Act, a vote by the Holders, voting
separately as a class, of more than 50% of the aggregate Liquidation Amount of
all then outstanding Securities issued by the Issuer.

"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman or a Vice Chairman of the Board of Directors
of such Person or the President, a Managing Director or a Vice President of such
Person, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of such Person, and delivered to the Guarantee Trustee. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Guarantee Agreement shall include:

(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;

(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;

(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and

(d) a statement as to whether, in the opinion of each officer, such
condition or covenant has been complied with.

"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.

"Responsible Officer" when used with respect to the Guarantee Trustee
means any officer of the Guarantee Trustee assigned by the Guarantee Trustee
from time to time to administer its corporate trust matters.

"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.

"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.

ARTICLE II. TRUST INDENTURE ACT

SECTION 2.1. Trust Indenture Act; Application.

(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.

3
8

(b) If and to the extent that any provision of this Guarantee Agreement
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.

SECTION 2.2. List of Holders.

(a) The Guarantor will furnish or cause to be furnished to the
Guarantee Trustee:

(i) semi-annually, not more than 15 days after January 15 and
July 15 in each year, a list in such form as the Guarantee Trustee may
reasonably require, of the names and addresses of the Holders as of
such January 1 and July 1, and

(ii) at such other times as the Guarantee Trustee may request
in writing, within 30 days after the receipt by the Guarantor of any
such request, a list of similar form and content as of a date not more
than 15 days prior to the time such list is furnished, excluding from
any such list names and addresses received by the Guarantee Trustee in
its capacity as Securities Registrar.

(b) The Guarantee Trustee shall comply with its obligations under
Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act.

SECTION 2.3. Reports by Guarantee Trustee.

The Guarantee Trustee shall transmit to Holders such reports concerning
the Guarantee Trustee and its actions under this Guarantee Agreement as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto. If required by Section 313(a) of the Trust Indenture
Act, the Guarantee Trustee shall, within 60 days after each May 15 following the
date of this Guarantee Agreement deliver to Holders a brief report, dated as of
such May 15, which complies with the provisions of such Section 313(a).

SECTION 2.4. Periodic Reports to Guarantee Trustee.

The Guarantor shall provide to the Guarantee Trustee, the Securities
and Exchange Commission and the Holders such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
Delivery of such reports, information and documents to the Guarantee Trustee
shall be for informational purposes only and the Guarantee Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein, including the Guarantor's compliance with any of its covenants
hereunder (as to which the Guarantee Trustee shall be entitled to rely
exclusively on Officers' Certificates).

SECTION 2.5. Evidence of Compliance with Conditions Precedent. The
Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with such conditions precedent, if any, provided for in this Guarantee Agreement
that relate to any of the matters set forth in

4
9

Section 314(c) of the Trust Indenture Act. Any certificate or opinion required
to be given by an officer pursuant to Section 314(c)(1) may be given in the form
of an Officers' Certificate.

SECTION 2.6. Events of Default; Waiver. The Holders of a Majority in
Aggregate Liquidation Amount of the Securities may, by vote, on behalf of the
Holders, waive any past Event of Default and its consequences. Upon such waiver,
any such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.

SECTION 2.7. Event of Default; Notice.

(a) The Guarantee Trustee shall, within 90 days after the occurrence of
an Event of Default, transmit by mail, first class postage prepaid, to the
Holders, notices of all Events of Default actually known to the Guarantee
Trustee, unless such defaults have been cured before the giving of such notice,
provided, that, except in the case of a default in the payment of a Guarantee
Payment, the Guarantee Trustee shall be protected in withholding such notice if
and so long as the Board of Directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.

(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Event of Default unless the Guarantee Trustee shall have received written
notice, or a Responsible Officer charged with the administration of this
Guarantee Agreement shall have obtained written notice, of such Event of
Default.

SECTION 2.8. Conflicting Interests. The Trust Agreement shall be deemed
to be specifically described in this Guarantee Agreement for the purposes of
clause (i) of the first proviso contained in Section 310(b) of the Trust
Indenture Act.

ARTICLE III. POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE

SECTION 3.1. Powers and Duties of Guarantee Trustee.

(a) This Guarantee Agreement shall be held by the Guarantee Trustee for
the benefit of the Holders, and the Guarantee Trustee shall not transfer this
Guarantee Agreement to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on acceptance by
such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee. The right, title and interest of the Guarantee Trustee shall
automatically vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.

5
10

(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.

(c) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Guarantee Agreement, and no implied covenants shall be read into this
Guarantee Agreement against the Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6), the
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Guarantee Agreement, and use the same degree of care and skill in its
exercise thereof, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.

(d) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct, except that:

(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:

(A) the duties and obligations of the Guarantee
Trustee shall be determined solely by the express provisions
of this Guarantee Agreement, and the Guarantee Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Guarantee
Agreement; and

(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and conforming to
the requirements of this Guarantee Agreement; but in the case
of any such certificates or opinions that by any provision
hereof or of the Trust Indenture Act are specifically required
to be furnished to the Guarantee Trustee, the Guarantee
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Guarantee Agreement;

(ii) the Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the
Guarantee Trustee, unless it shall be proved that the Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which such
judgment was made;

(iii) the Guarantee Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
Majority in Aggregate Liquidation Amount of the Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any trust or power
conferred upon the Guarantee Trustee under this Guarantee Agreement;
and

6
11

(iv) no provision of this Guarantee Agreement shall require
the Guarantee Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if the
Guarantee Trustee shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to it
under the terms of this Guarantee Agreement or adequate indemnity
against such risk or liability is not reasonably assured to it.

SECTION 3.2. Certain Rights of Guarantee Trustee.

(a) Subject to the provisions of Section 3.1:

(i) The Guarantee Trustee may rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document reasonably believed by it to be
genuine and to have been signed, sent or presented by the proper party
or parties.

(ii) Any direction or act of the Guarantor contemplated by
this Guarantee Agreement shall be sufficiently evidenced by an
Officers' Certificate unless otherwise prescribed herein.

(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter
be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.

(iv) The Guarantee Trustee may consult with legal counsel of
its selection, and the advice or opinion of such legal counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by it hereunder in good faith and in accordance with such advice
or opinion. Such legal counsel may be legal counsel to the Guarantor or
any of its Affiliates and may be one of its employees. The Guarantee
Trustee shall have the right at any time to seek instructions
concerning the administration of this Guarantee Agreement from any
court of competent jurisdiction.

(v) The Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or direction of any Holder, unless such Holder
shall have provided to the Guarantee Trustee such adequate security and
indemnity, as would satisfy a reasonable person in the position of the
Guarantee Trustee, against the costs, expenses (including attorneys'
fees and expenses) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Guarantee Trustee; provided that,
nothing contained in this Section 3.2(a)(v) shall be taken to relieve

7
12

the Guarantee Trustee, upon the occurrence of an Event of Default, of
its obligation to exercise the rights and powers vested in it by this
Guarantee Agreement.

(vi) The Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.

(vii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through its agents or attorneys, and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any such
agent or attorney appointed with due care by it hereunder.

(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive
written instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Guarantee Trustee (A) may
request instructions from the Holders, (B) may refrain from enforcing
such remedy or right or taking such other action until such written
instructions are received and (C) shall be protected in acting in
accordance with such written instructions.

(ix) The Guarantee Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Guarantee Agreement.

(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.

SECTION 3.3. Indemnity. The Guarantor agrees to indemnify the Guarantee
Trustee for, and to hold it harmless against, any loss, liability or expense
incurred without negligence or bad faith on the part of the Guarantee Trustee,
arising out of or in connection with the acceptance or administration of this
Guarantee Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.

ARTICLE IV. GUARANTEE TRUSTEE

SECTION 4.1. Guarantee Trustee: Eligibility.

(a) There shall at all times be a Guarantee Trustee which shall:

8
13

(i) not be an Affiliate of the Guarantor; and

(ii) be a Person that is eligible pursuant to the
Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000, and shall be a
corporation meeting the requirements of Section 310(a) of the
Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority, then,
for the purposes of this Section 4.1 and to the extent
permitted by the Trust Indenture Act, the combined capital and
surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published.

(b) If at any time the Guarantee Trustee shall cease to be eligible to
so act under Section 4. 1(a), the Guarantee Trustee shall immediately resign in
the manner and with the effect set out in Section 4.2(c).

(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.

SECTION 4.2. Appointment, Removal and Resignation of Guarantee Trustee.

(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed
or removed without cause at any time by the Guarantor.

(b) The Guarantee Trustee shall not be removed until a Successor
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Guarantee Trustee and delivered to
the Guarantor. If an instrument of acceptance by a Successor Guarantee Trustee
shall not have been delivered to the Guarantee Trustee within 30 days after such
removal, the Guarantee Trustee being removed may petition any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee.

(c) The Guarantee Trustee appointed hereunder shall hold office until a
Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.

(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Guarantee Trustee may petition, at the expense of the Guarantor, any court of
competent jurisdiction for appointment of a Successor Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Guarantee Trustee.

9
14

ARTICLE V. GUARANTEE

SECTION 5.1. Guarantee. The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by or on behalf of the Issuer), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer may
have or assert. The Guarantor's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Issuer to pay such amounts to the Holders.

SECTION 5.2. Waiver of Notice and Demand. The Guarantor hereby waives
notice of acceptance of the Guarantee Agreement and of any liability to which it
applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee Trustee, the Issuer or any other Person
before proceeding against the Guarantor, protest, notice of nonpayment, notice
of dishonor, notice of redemption and all other notices and demands.

SECTION 5.3. Obligations Not Affected. The obligations, covenants,
agreements and duties of the Guarantor under this Guarantee Agreement shall in
no way be affected or impaired by reason of the happening from time to time of
any of the following:

(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Securities to be performed or
observed by the Issuer;

(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment of
Distributions that results from the extension of any interest payment period on
the Debentures as provided in the Indenture), Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the Securities or the
extension of time for the performance of any other obligation under, arising out
of, or in connection with, the Securities;

(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Securities, or any action
on the part of the Issuer granting indulgence or extension of any kind;

(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;

(e) any invalidity of, or defect or deficiency in, the Securities;

(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or

10
15

(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.

There shall be no obligation of the Holders to give notice to, or
obtain the consent of, the Guarantor with respect to the happening of any of the
foregoing.

SECTION 5.4. Rights of Holders. The Guarantor expressly acknowledges
that: (i) this Guarantee Agreement will be deposited with the Guarantee Trustee
to be held for the benefit of the Holders; (ii) the Guarantee Trustee has the
right to enforce this Guarantee Agreement on behalf of the Holders; (iii) he
Holders of a Majority in Aggregate Liquidation Amount of the Securities have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Guarantee Trustee in respect of this Guarantee Agreement
or exercising any trust or power conferred upon the Guarantee Trustee under this
Guarantee Agreement; and (iv) any Holder may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Guarantee
Agreement, without first instituting a legal proceeding against the Guarantee
Trustee, the Issuer or any other Person.

SECTION 5.5. Guarantee of Payment. This Guarantee Agreement creates a
guarantee of payment and not of collection. This Guarantee Agreement will not be
discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by the Issuer) or upon distribution of
Debentures to Holders as provided in the Trust Agreement.

SECTION 5.6. Subrogation. The Guarantor shall be subrogated to all (if
any) rights of the Holders against the Issuer in respect of any amounts paid to
the Holders by the Guarantor under this Guarantee Agreement and shall have the
right to waive payment by the Issuer pursuant to Section 5.1; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which it may
acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Guarantee Agreement,
if, at the time of any such payment, any amounts are due and unpaid under this
Guarantee Agreement. If any amount shall be paid to the Guarantor in violation
of the preceding sentence, the Guarantor agrees to hold such amount in trust for
the Holders and to pay over such amount to the Holders.

SECTION 5.7. Independent Obligations. The Guarantor acknowledges that
its obligations hereunder are independent of the obligations of the Issuer with
respect to the Securities and that the Guarantor shall be liable as principal
and as debtor hereunder to make Guarantee Payments pursuant to the terms of this
Guarantee Agreement notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.

SECTION 5.8. Conversion. The Guarantor acknowledges and agrees to honor
and perform all of its obligations to issue and deliver common stock of the
Guarantor upon the conversion of the Capital Securities as provided in Article
XII of the Indenture.

11
16

ARTICLE VI. SUBORDINATION

SECTION 6.1. Subordination. The obligations of the Guarantor under this
Guarantee Agreement will constitute unsecured obligations of the Guarantor and
will rank subordinate and junior in right of payment to all Senior Debt (as
defined in the Indenture) of the Guarantor, except those made pari passu or
subordinate to such obligations expressly by their terms in the same manner as
set forth in Article XIII of the Indenture.

ARTICLE VII. TERMINATION

SECTION 7.1. Termination. This Guarantee Agreement shall terminate and
be of no further force and effect upon (i) full payment of the Redemption Price
of all Securities, (ii) the distribution of Debentures to the Holders in
exchange for all of the Securities or (iii) full payment of the amounts payable
in accordance with the Trust Agreement upon liquidation of the Issuer.
Notwithstanding the foregoing, this Guarantee Agreement will continue to be
effective or will be reinstated, as the case may be, if at any time any Holder
must restore payment of any sums paid with respect to Securities or this
Guarantee Agreement.

ARTICLE VIII. MISCELLANEOUS

SECTION 8.1. Successors and Assign. All guarantees and agreements
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Securities then outstanding. Except in connection
with a consolidation, merger or sale involving the Guarantor that is permitted
under Article VIII of the Indenture and pursuant to which the successor or
assignee agrees in writing to perform the Guarantor's obligations hereunder, the
Guarantor shall not assign its obligations hereunder.

SECTION 8.2. Amendments. Except with respect to any changes which do
not adversely affect the rights of the Holders or the Guarantee Trustee in any
material respect (in which case no consent of the Holders or the Guarantee
Trustee, as the case may be, will be required), this Guarantee Agreement may
only be amended with the prior approval of the Holders of not less than a
Majority in Aggregate Liquidation Amount of all the outstanding Securities and
of the Guarantee Trustee. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.

12
17

SECTION 8.3. Notice. Any notice, request or other communication
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by first class
mail as follows:

(a) if given to the Guarantor, to the address set forth below or such
other address, facsimile number or to the attention of such other Person as the
Guarantor may give notice to the Holders:

Texas Industries, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx
Xxxxxx, Xxxxx 75247-691347739
Attention:

(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) address set forth below or such other
address as the Guarantee Trustee on behalf of the Issuer may give notice to the
Holders:

TXI Capital Trust I
c/o Texas Industries, Inc.
0000 Xxxx Xxxxxxxxxxx Xxxx
Xxxxxx, Xxxxx 75247-691347739
Attention:

with a copy to:

---------------------

Attention:
----------------------

All notices hereunder shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.

SECTION 8.4. Benefit. This Guarantee Agreement is solely for the
benefit of the Holders and is not separately transferable from the Securities.

SECTION 8.5. Interpretation. In this Guarantee Agreement, unless the
context otherwise requires:

13
18

(a) capitalized terms used in this Guarantee Agreement but not defined
in the preamble hereto have the respective meanings assigned to them in Section
1.1;

(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;

(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time;

(d) all references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless otherwise
specified;

(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires;

(f) a reference to the singular includes the plural and vice versa; and

(g) the masculine, feminine or neuter genders used herein shall include
the masculine, feminine and neuter genders.

SECTION 8.6. Governing Law. THUS GUARANTEE AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

SECTION 8.7. Counterparts. This instrument may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.

14
19

THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.

TEXAS INDUSTRIES, INC.

By:
--------------------------------
[Name]
[Title]

--------------------
as Guarantee Trustee

By:
--------------------------------
Name:
Title:

Document Metadata

Table of Contents

BETWEEN

Document Metadata