Exhibit 10.2
TOLL BROTHERS, INC.
NON-QUALIFIED STOCK OPTION GRANT
     THIS NON-QUALIFIED STOCK OPTION is granted as of [DATE] (the “Effective
Date”) by TOLL BROTHERS, INC., a Delaware corporation (the “Company”) under the
Toll Brothers, Inc. Stock Incentive Plan for Non-Employee Directors (2007) (the
“Plan”), to [NAME] (the “Optionee”).
WITNESSETH:
     1. Grant. As of the Effective Date, the Company granted to the Optionee an
option (the “Option”) to purchase on the terms and conditions hereinafter set
forth all or any part of an aggregate of [NUMBER] shares of the Company’s Common
Stock, par value $0.01 per share, (the “Option Shares”), at the purchase price
of [$                    ] per share (the “Option Price”). The Optionee shall
have the cumulative right to exercise the Option, and the Option is only
exercisable, with respect to the following number of Option Shares on or after
the following dates:

                  Number of Option Shares             that may be purchased on  
        Total or after [DATE]:           Option Shares
 
               
[DATE]
[# OF SHARES]
  [DATE]
[# OF SHARES]   [DATE]
[# OF SHARES]   [DATE]
[# OF SHARES]     [TOTAL]

The Committee may, in its sole discretion, accelerate the date on which the
Optionee may purchase Option Shares.
     2. Term. The Option granted hereunder shall expire in all events at 5:00
p.m. (local Philadelphia, Pennsylvania time) on [DATE], unless sooner terminated
as provided in Subparagraphs (a), (b), (c), (d) or (e) below.
          (a) Leaving Board of Directors. Except as otherwise provided herein or
in any separate provisions applicable to this Option, the Option shall terminate
three (3) months after the Optionee ceases to be a member of the Board of
Directors of the Company (the “Board”) for any reason other than provided in
paragraph 2(b) below. During such three month period the Optionee may purchase
any remaining Option Shares which could have been purchased on the date
Optionee’s service terminated, but may not purchase any Option Shares which
would otherwise first become purchasable during such three month period.
          (b) Disability or Death. Except as otherwise provided herein or in any
separate provisions applicable to this Option, the Option shall terminate one
(1) year after

 

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the Optionee’s employment with the Company and/or its Affiliates is terminated
by reason of the Optionee’s Disability or by death. During such one year period
the Optionee (or, as applicable, the Optionee’s heirs or legal representative)
may purchase any remaining Option Shares which could have been purchased on the
date Optionee’s employment terminated, but may not purchase any Option Shares
which would otherwise become purchasable during such one year period.
          (c) Change in Accounting Treatment. If the Committee finds that a
change in the financial accounting treatment for options granted under the Plan
from that in effect on December 13, 2006, when the Plan was adopted, adversely
affects the Company or, in the determination of the Committee, may adversely
affect the Company in the foreseeable future, the Committee may, in its
discretion, set an accelerated termination date for the Option. In such event,
the Committee may take whatever other action, including acceleration of any
exercise provisions, it deems necessary.
          (d) Change in Control. In the event of a Change in Control (as defined
in the Plan) the Option shall become immediately exercisable in full. In
addition, in such event the Committee may accelerate the termination date of the
Option to a date no earlier than thirty (30) days after notice of such
acceleration is given to the Optionee. Upon the giving of any such acceleration
notice, the Option shall become immediately exercisable in full.
          (e) Definitions. For purposes of this Option: (i) the term “Affiliate”
shall mean a corporation which is a parent corporation or a subsidiary
corporation with respect to the Company within the meaning of section 425(e) or
(f) of the Code; (ii) the term “Cause” shall mean a breach by the Optionee of
his or her employment or service contract with the Company or an Affiliate, or
an act by the Optionee involving any sort of disloyalty to the Company or an
Affiliate, including, without limitation, fraud, embezzlement, theft, commission
of a felony or proven dishonesty in the course of his or her employment or
service or a disclosure of trade secrets of the Company or an Affiliate;
(iii) the term “Committee” shall refer to the Committee designated to administer
the Plan; and (iv) the term Disabliity shall means any condition that
constitutes a “disability” as that term is defined in section 22(e)(3) of the
Internal Revenue Code of 1986, as amended (the “Code”).
     3. General Rules. To the extent otherwise exercisable, this Option may be
exercised in whole or in part except that (a) any partial exercise of this
Option must be for a round lot of 100 Option Shares or a whole number multiple
thereof and (b) this Option may in no event be exercised (i) with respect to
fractional shares or (ii) after the expiration of the Option term for any reason
under Paragraph 2 hereof.
     4. Transfers. Except as otherwise provided herein or in any separate
provisions applicable to this Option, the Option is transferable by the Optionee
only by will or pursuant to the laws of descent and distribution in the event of
the Optionee’s death, in which event the Option may be exercised by the heirs or
legal representatives of the Optionee. Any attempt at assignment, transfer,
pledge or disposition of the Option contrary to the provisions hereof or the
levy of any execution, attachment or similar

 

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process upon the Option shall be null and void and without effect. Any exercise
of the Option by a person other than the Optionee shall be accompanied by
appropriate proofs of the right of such person to exercise the Option.
     5. Method of Exercise and Payment.
          (a) Method of Exercise. When exercisable under Paragraphs 1, 2 and 3,
the Option may be exercised by written notice, pursuant to Paragraph 9, to the
Committee specifying the number of Option Shares to be purchased and, unless the
Option Shares are covered by a then-current registration statement or a
Notification under Regulation A under the Securities Act of 1933 (the “Act”) and
current registrations under all applicable state securities laws, containing the
Optionee’s acknowledgement, in form and substance satisfactory to the Company,
that the Optionee (a) is purchasing such Option Shares for investment and not
for distribution or resale (other than a distribution or resale which, in the
opinion of counsel satisfactory to the Company, may be made without violating
the registration provisions of the Act), (b) has been advised and understands
that (i) the Option Shares have not been registered under the Act and are
“restricted securities” within the meaning of Rule 144 under the Act and are
subject to restrictions on transfer and (ii) the Company is under no obligation
to register the Option Shares under the Act or to take any action which would
make available to the Optionee any exemption from such registration, and (c) has
been advised and understands that such Option Shares may not be transferred
without compliance with all applicable federal and state securities laws. The
notice shall be accompanied by payment of the aggregate Option Price of the
Option Shares being purchased. Such exercise shall be effective upon the actual
receipt by the Committee of such written notice and payment. For these purposes,
the Optionee shall be deemed to have made the payment required for exercise of
the Option at such time as it is determined that satisfactory arrangements have
been made to ensure payment of all amounts as are required to be paid by
Optionee in connection with the exercise of the Option.
          (b) Medium of Payment. An Optionee may pay for Option Shares, and the
amount of any tax withholding required, (i) in cash, (ii) by certified check
payable to the order of the Company, (iii) by means of arranging through a
broker designated by the Company to have the broker remit sufficient proceeds
from the sale of such shares, (iv) by means of a net issuance (as described
below), (v) by a combination of the foregoing, or (vi) by such other method as
the Committee may determine to be appropriate from time to time. Furthermore,
subject to the restrictions described below, payment of the Option Price of the
Option Shares being purchased may be made all or in part in shares of the Common
Stock of the Company held by the Optionee for more than one year. If payment is
made in whole or in part in shares of the Common Stock, then the Optionee shall
(1) deliver to the Company certificates registered in the name of such Optionee
representing shares of Common Stock legally and beneficially owned by such
Optionee, free of all liens, claims and encumbrances of every kind and having a
fair market value on the date of delivery of such notice that is not greater
than the product of the Option Price and the number of Option Shares with
respect to which such Option is to be exercised, accompanied by stock powers
duly endorsed in blank by the record holder of the shares represented by such
certificates or (2) attest to his ownership of shares of Common Stock having a
fair

 

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market value on the date of exercise at least equal to the options being
exercised. Notwithstanding the foregoing, the Board of Directors, in its sole
discretion, may refuse to accept shares of Common Stock in payment of the Option
Price. In that event, any certificates representing shares of Common Stock which
were delivered to the Company shall be returned to the Optionee with notice of
the refusal of the Board of Directors to accept such shares in payment of the
Option Price. The Board of Directors may impose such limitations and
prohibitions on the use of shares of the Common Stock to exercise an Option as
it deems appropriate.
     The Optionee may arrange for exercise of an Option and payment of the
Option Price by means of a net issuance of shares as described below, provided,
however, that exercise by means of a net issuance shall be permitted only if
approved in advance by the Committee. If a net issuance of shares is so approved
and the Optionee chooses to exercise in that manner, the exercise of the Option
shall be treated as follows: Upon notice of exercise, the Optionee shall be
deemed, as of the date of exercise, to have received all of the shares of Common
Stock subject to the Option (or such portion of such shares as corresponds to
the portion of the Option being exercised), and shall simultaneously be deemed
to have delivered back to the Company that number of such shares as have a fair
market value (determined as of the date of exercise) equal to the Option Price
required to be paid on exercise of the Option (or portion being exercised).
     6. Adjustments on Changes in Common Stock. In the event that, prior to the
delivery by the Company of all of the Option Shares in respect of which the
Option is granted, there shall be an increase or decrease in the number of
issued shares of Common Stock of the Company as a result of a subdivision or
consolidation of shares or other capital adjustment, or the payment of a stock
dividend or other increase or decrease in such shares, effected without receipt
of consideration by the Company, the remaining number of Option Shares still
subject to the Option and the Option Price therefor shall be adjusted in a
manner determined by the Committee so that the adjusted number of Option Shares
and the adjusted Option Price shall be the substantial equivalent of the
remaining number of Option Shares still subject to the Option and the Option
Price thereof prior to such change. For purposes of this Paragraph no adjustment
shall be made as a result of the issuance of Common Stock upon the conversion of
other securities of the Company which are convertible into Common Stock.
     7. Legal Requirements. If the listing, registration or qualification of the
Option Shares upon any securities exchange or under any federal or state law, or
the consent or approval of any governmental regulatory body is necessary as a
condition of or in connection with the purchase of such Option Shares, the
Company shall not be obligated to issue or deliver the certificates representing
the Option Shares as to which the Option has been exercised unless and until
such listing, registration, qualification, consent or approval shall have been
effected or obtained. If registration is considered unnecessary by the Company
or its counsel, the Company may cause a legend to be placed on the Option Shares
being issued calling attention to the fact that they have been acquired for
investment and have not been registered.

 

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     8. Administration. The Option has been granted pursuant to, and is subject
to the terms and provisions of, the Plan. All questions of interpretation and
application of the Plan and the Option shall be determined by the Committee, and
such determination shall be final, binding and conclusive. The Option shall not
be treated as an incentive stock option (as such term is defined in section
422(b) of the Code) for federal income tax purposes.
     9. Notices. Any notice to be given to the Company shall be addressed to the
Committee at its principal executive office, and any notice to be given to the
Optionee shall be addressed to the Optionee at the address then appearing on the
personnel records of the Company or the Affiliate of the Company by which he is
employed, or at such other address as either party hereafter may designate in
writing to the other. Any such notice shall be deemed to have been duly given
when deposited in the United States mail, addressed as aforesaid, registered or
certified mail, and with proper postage and registration or certification fees
prepaid.
     IN WITNESS WHEREOF, the Company has granted this Option as of the day and
year first above written.

            TOLL BROTHERS, INC.
      By:                        

(Corporate Seal)