Exhibit 10h
HOVNANIAN ENTERPRISES, INC.
1999 STOCK INCENTIVE PLAN
STOCK OPTION AGREEMENT
(Directors)
Participant: Date of Grant:
Number of Class A Shares: Xxxxx Xxxxx:
Vesting Schedule:
Date: Number of Shares:
Option Termination Date:
1. Grant of the Option. For valuable consideration, receipt
of which is hereby acknowledged, Hovnanian Enterprises, Inc., a Delaware
Corporation (the "Company"), hereby grants the right to purchase, on the
terms and conditions hereinafter set forth, all or any part of an aggregate
number of Class A Shares set forth above. This grant is made subject to the
terms and conditions of the Company's 1999 Stock Incentive Plan, (the
"Plan"), which Plan is incorporated herein by reference and subject to the
amendments to the Plan. The purchase price of the Shares subject to the
Option (the "Xxxxx Xxxxx") shall be the price per Share set forth above.
This Option is not an Incentive Stock Option within the meaning of Section
422 of the Internal Revenue Code of 1986 (the "Code").
2. Vesting. The Option will vest in accordance with the
schedule set forth above.
3. Exercise of Option.
(a) Period of Exercise.
(i) In General. The Options must be exercised before the
Option Termination Date (the "Termination Date"). The Participant may
exercise less than the full installment available to him under the Options,
but he must exercise the Options in full shares of the Common Stock of the
Company. The Participant is limited to ten exercises of the Options prior to
the Termination Date.
(ii) Termination of Board of Directors Membership Other than Due
to Death or Disability. If, prior to the Termination Date, the Participant
ceases to be a member of the Board of Directors (otherwise than by reason of
death or disability within the meaning of Section 22(e)(3) of the Internal
Revenue Code of 1986, as amended ("Disability")), any Options, to the extent
not previously exercised, shall remain exercisable until the earlier of (i)
the Termination Date and (ii) the sixtieth (60th) day after the date the
Participant ceases to be a member of the Board of Directors, and thereafter
all Options to the extent not previously exercised shall terminate together
with all other rights hereunder. The Options shall be wholly void and of no
effect after the Termination Date.
(iii) Termination of Board of Directors Membership Due to Death.
If, prior to the Termination Date, the Participant ceases to be a member of
the Board of Directors due to the Participant's death, the Options shall
immediately become fully exercisable and shall remain exercisable until the
earlier of (i) the Termination Date and (ii) the first anniversary of the
Participant's death. The Options may be exercisable by the person or persons
to whom the Participant's rights under the Options shall pass by will or by
the applicable laws of descent and distribution, and thereafter all Options
to the extent not previously exercised shall terminate together with all
other rights hereunder.
(iv) Termination of Board of Directors Membership Due to
Disability. If, prior to the Termination Date, the Participant ceases to be
a member of the Board of Directors due to the Participant's Disability, the
Options shall immediately become fully exercisable and shall remain
exercisable until the earlier of (i) the Termination Date and (ii) the first
anniversary the date the Participant ceases to be a member of the Board of
Directors, by the Participant or his or her designated personal
representative on the Participant's behalf, and thereafter all Options to the
extent not previously exercised shall terminate together with all other
rights hereunder.
(b) Method of Exercise. Subject to the provisions of the Plan,
the Options may be exercised by written notice to the Company stating the
number of shares with respect to which it is being exercised and accompanied
by payment of the Option Price (a) by certified or bank cashier's check
payable to the order of the Company in New York Clearing House Funds, (b) by
surrender or delivery to the Company of shares of its Common Stock that have
been held by the Participant for at least six months (or such other period of
time as may be determined by the Board of Directors), or (c) in any other
form acceptable to the Company, together with payment or arrangement for
payment of any minimum federal income or other tax required to be withheld by
the Company. As soon as practical after receipt of such notice and payment,
the Company shall, without transfer or issue tax or other incidental expense
to the Participant, deliver to the Participant at the offices of the Company
at 00 Xxxxxxx 00, Xxx Xxxx, Xxx Xxxxxx, or such other place as may be
mutually acceptable, or, at the election of the Company, by first class
insured mail addressed to the Participant at his address shown in the
employment records of the Company or at the location at which he is employed
by the Company or subsidiary, a certificate or certificates for previously
unissued shares or reacquired shares of its Common Stock as the Company may
elect.
(c) Delivery of Shares.
(i) The Company may postpone the time of delivery of
certificates for shares of its Common Stock for such additional time as the
Company shall deem necessary or desirable to enable it to comply with the
listing requirements of any securities exchange upon which the Common Stock
of the Company may be listed, or the requirements of the Securities Act of
1933 or the Securities Exchange Act of 1934 or any Rules or Regulations of
the Securities and Exchange Commission promulgates thereunder or the
requirements of applicable state laws relating to authorization, issuance or
sales of securities.
(ii) If the Participant fails to accept delivery of the shares
of Common Stock of the Company upon tender of delivery thereof, his or her
right to exercise the Options with respect to such undelivered shares may be
terminated by the Company
4. Adjustments Upon Certain Events. Subject to the terms of
the Plan, in the event of any change in the outstanding Shares by reason of
any Share dividend or split, reorganization, recapitalization, merger,
consolidation, amalgamation, spin-off or combination transaction or exchange
of Shares or other similar events (collectively, an "Adjustment Event"), the
Committee may, in its sole discretion, make an appropriate and equitable
adjustment in the number of Shares subject to this Agreement to reflect such
Adjustment Event. Any such adjustment made by the Committee shall be final
and binding upon the Participant, the Company and all other interested
persons.
5. No Acquired Rights. In participating in the Plan, the
Participant acknowledges and accepts that the Board has the power to amend or
terminate the Plan, to the extent permitted thereunder, at any time and that
the opportunity given to the Participant to participate in the Plan is
entirely at the discretion of the Board and does not obligate the Company or
any of its Affiliates to offer such participation in the future (whether on
the same or different terms).
6. No Rights of a Shareholder. The Participant shall not have
any rights or privileges as a shareholder of the Company until the Shares in
question have been registered in the Company's register of shareholders.
7. Legend on Certificates. Any Shares issued or transferred
to the Participant pursuant to Section 8 of this Agreement shall be subject
to such stop transfer orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations, and other requirements of
the Securities and Exchange Commission, any stock exchange upon which such
Shares are listed, and any applicable Federal or state laws or relevant
securities laws of the jurisdiction of the domicile of the Participant, and
the Committee may cause a legend or legends to be put on any certificates
representing such Shares to make appropriate reference to such restrictions.
8. Transferability. The Options shall, during the
Participant's lifetime, be exercisable only by the Participant, and neither
it nor any right hereunder shall be transferable otherwise than by will or
the laws of descent and distribution or be subject to attachment, execution
or other similar process. Notwithstanding the foregoing, an Participant may
transfer the Options in whole or in part by gift or domestic relations order
to a family member of the Participant (a "Permitted Transferee") and,
following any such transfer, such Options or portion thereof shall be
exercisable only by the Permitted Transferee, provided that no such Options
or portion thereof is transferred for value, and provided further that,
following any such transfer, neither such Options or any portion thereof nor
any right hereunder shall be transferable other than to the Participant or
otherwise than by will or the laws of descent and distribution or be subject
to attachment, execution or other similar process. For purposes of this
paragraph, "family member" includes any child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or
sister-in-law, including adoptive relationships, any person sharing the
Participant's household (other than a tenant or employee), trust in which
these persons have more than fifty percent of the beneficial interest, a
foundation in which these persons (or the Participant) control the management
of assets and any other entity in which these persons (or the Participant)
own more than fifty percent of the voting interests. In the event of any
attempt by the Participant to alienate, assign, pledge, hypothecate or
otherwise dispose of his or her Options or of any right hereunder, except as
provided for herein, or in the event of any levy or any attachment, execution
or similar process upon the rights or interest hereby conferred, the Company
may terminate his Options by notice to the Participant and it shall thereupon
become null and void.
9. Choice of Law. THE INTERPRETATION, PERFORMANCE AND
ENFORCEMENT OF THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
DELAWARE WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
10. Option Subject to Plan. By entering into this Agreement,
the Participant agrees and acknowledges that the Participant has received and
read a copy of the Plan. The Option is subject to the Plan. In the event of
a conflict between any term or provision contained herein and a term or
provision of the Plan, the applicable terms and provisions of the Plan will
govern and prevail.
11. Signature in Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement.
HOVNANIAN ENTERPRISES, INC.
/S/XXX X. HOVNVNIAN
Xxx X. Xxxxxxxxx
President
Chief Executive Officer
PARTICIPANT:
