Company: HOVVB
Filing Date: 2025-02-07
Form Type: DEF 14A
Source: 0001140361-25-003579
Chunk: 43

Company: HOVNANIAN ENTERPRISES INC
Filing Date: 2025-02-07
Form: DEF 14A
Chunk 43
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 for the twelve months ended October 31, 2024, excluding: (1) expense/income recorded during the performance period from any phantom share based awards related to changes in the stock price above or below the stock price at the date of grant; (2) the impact of any items deemed by the Committee to be unusual or nonrecurring items and excluding losses from land impairments; and (3) gains or losses from debt repurchases/debt retirement such as call premiums and related issuance costs. The Liquidity Balancescomponent of the NEOs’ bonus formulas was based on the number of fiscal 2024 quarter-ends in which Liquidity Balances were at or above $200 million. “Liquidity Balances” are defined as homebuilding cash and cash equivalents plus restricted cash that collateralizes letters of credit plus the available borrowing capacity under the Company’s revolving credit facility. This element of the bonus calculation directly correlates with the Company’s strategic goal of enhancing our liquidity in order to grow the Company in light of our challenges accessing the capital markets. The Alternative Capital Raisescomponent of the NEOs’ bonus formulas measured amounts raised by the Company or its unconsolidated joint ventures from alternative capital sources as determined by the Committee (including, but not limited to, financing by joint ventures, land banking transactions and non-recourse debt, but excluding SEC registered and 144A debt financing transactions) that were closed during fiscal 2024. This element of the bonus calculation directly correlates with the Company’s strategic goal of enhancing our liquidity through innovative sources of additional capital in order to grow the Company in light of our challenges accessing the capital markets. 85 The bonus formulas for Mr. Ara Hovnanian,
Mr. O’Connor and Mr. Alexander Hovnanian
are illustrated by the following tables.

|                | Mr. Ara Hovnanian 
 Bonus*            | Mr. O’Connor  
 Bonus**       | Mr. Alexander Hovnanian 
 Bonus**                 |
| ROAE           |                   |               |                         |
|                | Percentage of     
 Pre-tax Profit    | Percentage of 
 Base Salary   | Percentage of           
 Base Salary             |
| 0.00% or less  | 0.00%             | 0.00%         | 0.00%                   |
| 5.00%          | 1.00%             | 20.00%        | 20.00%                  |
| 10.00%         | 1.25