Company: HOVVB
Filing Date: 2025-02-07
Form Type: DEF 14A
Source: 0001140361-25-003579
Chunk: 53

Company: HOVNANIAN ENTERPRISES INC
Filing Date: 2025-02-07
Form: DEF 14A
Chunk 53
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’s performance. Award payouts, if any, will be based on a specific target multiple of each participant’s base salary in effect on January 1, 2024. Relative to the 2023 LTIP, the Committee determined to increase Mr. Ara Hovnanian’s specific target multiple of base salary for the 2024 LTIP from 1.35 to 1.75 in order to (1) account for the fact that Mr. Hovnanian had not in recent years, upon his recommendation, received an increase in base salary whereas the other NEOs have received increases in their respective base salaries consistent with the Company’s ordinary course merit-based salary and cost of living increase practices and (2) more closely align Mr. Hovnanian’s LTIP award value with peer group practices. 97 The following describes the target multiple of base salary and form of payout for each NEO:

|                            | Target Multiple 
  of Base Salary | Payout Method                 |
| Mr. Ara K. Hovnanian       |            1.75 | 50% shares/50% phantom shares |
| Mr. Brad G. O’Connor       |            0.75 | 50% shares/50% phantom shares |
| Mr. Michael P. Wyatt       |           0.675 | 50% shares/50% phantom shares |
| Mr. Alexander A. Hovnanian |            0.75 | 50% shares/50% phantom shares |

The Awards are reflected in the Summary Compensation Table as “Stock Awards” in fiscal 2024 even though the LTIP share portion remains subject to mandatory delayed delivery restrictions through fiscal 2028, as discussed above. Potential award payouts range from 0% to 250% of the target award depending on performance against two metrics: (1) EBIT Return on Investment relative to the Peer Group for the four most recently completed fiscal quarters as of October 31, 2026; and (2) specified levels of net debt to capital as of October 31, 2026. For purposes of the LTIP, “EBIT Return on Investment” shall mean the quotient resulting from dividing EBIT by Average Investment. For purposes of the LTIP, “EBIT” shall mean income (loss) before interest and income tax expense during the performance period as reflected on each company’s audited financial statements for such performance period, excluding losses from land impairments and gains or losses from debt repurchases/debt retirement such as