Form of Notice of Eligibility and Participation Agreement for Douglas G. Borror


 Exhibit 10.1 
 DOMINION HOMES, INC. 
 AMENDED AND RESTATED INCENTIVE GROWTH PLAN 
 NOTICE OF ELIGIBILITY AND PARTICIPATION AGREEMENT - 2006 
  

			
	 To:
	 	Douglas G. Borror
		
	 From:
	 	Dominion Homes, Inc., Compensation Committee
		
	Re:	 	Dominion Homes, Inc. Incentive Growth Plan

 The Compensation Committee has designated you as a participant in the Dominion Homes, Inc. Incentive Growth Plan
(“Plan”). 
 Our shareholders adopted the Plan [1] to provide incentive compensation to our most senior officers and [2] to
ensure that the Company may deduct that incentive compensation when calculating its taxable income. To achieve these objectives, both you, as a Plan participant, and the Company must comply with procedures imposed by the IRS. This Notice describes
those procedures. Please read this Notice carefully to ensure that you completely understand what must happen if you are to earn incentive compensation for 2006 and when this compensation, if earned, will be paid. 
 Note: As a condition of eligibility, you must return a signed copy of this form (see Section 3.00) to the Company’s Compensation Committee at the address
shown in Section 3.00. 
 1.00 Your incentive compensation will be paid if certain conditions are met . . . 
 The Plan (and the IRS) require that the Compensation Committee establish: 
  

	 	•	 	The conditions that must be met if you are to receive incentive compensation under the Plan (“Performance Criteria”); 

  

	 	•	 	The period over which the Performance Criteria are to be met (“Performance Cycle”); and 

  

	 	•	 	The amount you will receive if the Performance Criteria are met. 

 1.01 The Company must achieve certain financial goals 
 Your incentive compensation for 2006 will depend on the
Company’s corporate net income, corporate debt management, and customer satisfaction for the 2006 Performance Cycle. As described in Section 1.03, your incentive compensation has been allocated between each of these three elements.







 1.02 And, these goals must be met during a limited period of time . . . 
 The Performance Cycle will be the Company’s 2006 fiscal year. 
 1.03 If these conditions are met, you will receive incentive compensation . . . 
 If the Performance Criteria
described in Section 1.03[1] are met at any time during the 2006 Performance Cycle (see Section 1.02), you will receive the incentive compensation described in this section, subject to forfeiture as described in Section 1.03[4]. 
 If the Performance Criteria described in Section 1.03[2] are met at the end of the 2006 Performance Cycle (see Section 1.02), you will receive the incentive
compensation described in this section. 
 If the Performance Criteria described in Section 1.03[3] are met at the end of the 2006 Performance Cycle
(see Section 1.02), you will receive the incentive compensation described in this section. 
 [1] Net Income Performance Criteria

 If the Net Income Performance Criteria is met, you will receive incentive compensation in the following amount:

  

						
	Category	 	Net Income Achieved	 	Incentive Compensation Paid
		 	Target	 	$	78,000
		 	Stretch	 	$	195,000
		 	Exceptional	 	$	325,000

 [2] Corporate Debt Management 
 If the Corporate Debt Management Performance Criteria is met, you will receive incentive compensation in the following amount: 
  

						
	Category	 	Corporate Debt Level	 	Incentive Compensation Paid
	Target	 	100% of Target Debt Reduction	 	$	78,000
	Stretch	 	133% of Target Debt Reduction	 	$	195,000
	Exceptional	 	166% of Target Debt Reduction	 	$	325,000

  

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 [3] Customer Satisfaction Performance Criteria 
 If the Customer Satisfaction Performance Criteria (as measured by affirmative customer survey responses to the question “Would you recommend us to a friend?”)
is met at the end of the Performance Cycle, you will receive incentive compensation in the following amount: 
  

							
	Category	 	Customer Satisfaction Achieved	 	 	Incentive Compensation Paid
	Target	 	94	%	 	$	39,000
	Stretch	 	95	%	 	$	97,500
	Exceptional	 	96	%	 	$	162,500

 [3] Limitation 
 If the Company’s net income, corporate debt level, or customer satisfaction fall between the levels specified in Section 1.03[1] or [2], you will receive the amount associated with the next lowest stated increment (no incremental
bonus amounts will be paid). 
 [4] Forfeiture 
 If, after you have been paid your incentive compensation for 2006, the Company restates its net income such that the Net Income Performance Criteria specified in Section 1.03[1] was not met during the Performance Period (or the
Compensation Committee otherwise determines that the Net Income Performance Criteria was not met during the Performance Period), you must repay to the Company the incentive compensation you received pursuant to Section 1.03[1] within 30 days of
the restatement or the Compensation Committee’s determination. 
 2.00 There are a few other rules . . . 
 The Plan imposes a few additional rules that may affect your incentive compensation: 
  

	 	•	 	If you die, Retire (i.e., terminate employment after age 55) or become disabled (as defined in the Company’s disability plan) during the 2006 Performance Cycle, you may receive
Plan incentive compensation but only to the extent the Performance Criteria described in Section 1.03[1] are met at any time during the 2006 Performance Cycle. In this case, you (or your beneficiary) will receive the amount described in
Section 1.03[1] reduced to reflect the number of whole months that you worked during the 2006 Performance Cycle (e.g., if you worked only 50 percent of the 2006 Performance Cycle, you (or your beneficiary) would receive only 50 percent of the
amount described in Section 1.03[1]). 

  

 -3- 








	 	•	 	If you die, Retire (i.e., terminate employment after age 55) or become disabled (as defined in the Company’s disability plan) during the 2006 Performance Cycle, you may receive
Plan incentive compensation but only to the extent the Performance Criteria described in Section 1.03[2] are met at the end of the 2006 Performance Cycle. In this case, you (or your beneficiary) will receive the amount described in
Section 1.03[2] reduced to reflect the number of whole months that you worked during the 2006 Performance Cycle (e.g., if you worked only 50 percent of the 2006 Performance Cycle, you (or your beneficiary) would receive only 50 percent
of the amount described in Section 1.03[2]). 

  

	 	•	 	If you die, Retire (i.e., terminate employment after age 55) or become disabled (as defined in the Company’s disability plan) during the 2006 Performance Cycle, you may receive
Plan incentive compensation but only to the extent the Performance Criteria described in Section 1.03[3] are met at the end of the 2006 Performance Cycle. In this case, you (or your beneficiary) will receive the amount described in
Section 1.03[3] reduced to reflect the number of whole months that you worked during the 2006 Performance Cycle (e.g., if you worked only 50 percent of the 2006 Performance Cycle, you (or your beneficiary) would receive only 50 percent
of the amount described in Section 1.03[2]). 

  

	 	•	 	If you terminate employment before the end of the 2006 Performance Cycle for any reason other than death, retirement or disability, you will not receive any incentive compensation
for the 2006 Performance Cycle, even if the Performance Criteria described in Section 1.03 are met. 

  

	 	•	 	If a “change in control” (as defined in the Plan) occurs during the 2006 Performance Cycle, you will receive 100 percent of your Stretch bonus amount regardless of whether
(1) the Performance Criteria for the 2006 Performance Cycle have been met and (2) the 2006 Performance Cycle has been completed. 

  

	 	•	 	As of the end of the 2006 Performance Cycle, the Compensation Committee will review the extent to which Performance Criteria have been met and whether (and how much) incentive
compensation is due under the Plan. The Compensation Committee will certify its conclusions to the Board. 

  

	 	•	 	Any incentive compensation you earn for 2006 will be paid in a lump sum no later than 90 days after the end of the 2006 Performance Cycle. However, if there is a change in control
during the 2006 Performance Cycle, 100 percent of your Stretch bonus amount will be paid no later than 60 days after the change in control occurs. 

  

	 	•	 	You may designate a beneficiary to receive any Plan incentive compensation that becomes due after your death. This can be done by completing the attached beneficiary designation
form. If you do not complete this form, any Plan incentive compensation due at your death will be paid to your surviving spouse or, if you leave no surviving spouse, to your estate. 

  

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 3.00 You must sign this form . . . 
 Note: You will not receive any Plan incentive compensation unless you return a signed copy of this Notice to the Compensation Committee, c/o Christine A. Murry, Vice President, Corporate Counsel and Secretary of
the Company, at the Company’s corporate offices, 5000 Tuttle Crossing Boulevard, Dublin, Ohio no later than March 31, 2006. 
 By signing
below, I acknowledge that I understand the terms of the Dominion Homes, Inc. Incentive Growth Plan and the conditions that must be met before I can receive any incentive compensation from that plan. 
 EMPLOYEE: 
  

					
	  
	 		 	  

	Douglas G. Borror	 		 	(Date)
			
	RECEIVED BY:	 		 	
			
	  
	 		 	  

	(Authorized Dominion Homes, Inc. representative)	 		 	(Date)
			
	  
	 		 	
	Print Name	 		 	

  

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 ATTACHMENT 
 TO 
 DOMINION HOMES, INC. 
 INCENTIVE GROWTH PLAN 
 NOTICE OF PARTICIPATION AND ELGIBILITY 

Beneficiary Designation 
 Primary Beneficiary
Designation. I designate the following persons as my Primary Beneficiary or Beneficiaries to receive any amounts payable on my death under this Agreement. This benefit will be paid, in the proportion specified, to: 
  

							
	100	  	% to	  	the then acting trustee of the trust agreement executed by Douglas G. Borror as grantor and as trustee, on June 18, 2001, as
amended.
		  		  	(Name)	  	(Relationship)
				
	  	  	% to	  	  	  	  
		  		  	(Name)	  	(Relationship)
				
	Address:	  	  	  	  	  	  
				
	  	  	% to	  	  	  	  
		  		  	(Name)	  	(Relationship)
				
	Address:	  	  	  	  	  	  
				
	  	  	% to	  	  	  	  
		  		  	(Name)	  	(Relationship)
				
	Address:	  	  	  	  	  	  

 Note: You are not required to name more than one Primary Beneficiary but if you do, the sum of these
percentages may not be larger than 100 percent. 
  

 -6- 







 Contingent Beneficiary Designation. If one or more of my Primary Beneficiaries dies before I die, I direct that
any amounts payable on my death under this Agreement benefit that might otherwise have been paid to that Beneficiary: 
  

							
	  	 	Be paid to my other named Primary Beneficiaries in proportion to the allocation given above (ignoring the interest allocated
to the deceased Primary Beneficiary);
or
		
	  	 	Be distributed among the following Contingent Beneficiaries.
				
	  	 	% to	 	  	 	  
		 		 	(Name)	 	(Relationship)
				
	Address:	 	  	 	  	 	  
				
	  	 	% to	 	  	 	  
		 		 	(Name)	 	(Relationship)
				
	Address:	 	  	 	  	 	  
				
	  	 	% to	 	  	 	  
		 		 	(Name)	 	(Relationship)
				
	Address:	 	  	 	  	 	  

 Note: You are not required to name more than one Contingent Beneficiary but if you do, the sum of these
percentages may not be larger than 100 percent. 
  
  

					
	(Signature)	 		 	(Date)
			
	Douglas G. Borror	 		 	
	 (Print Name)
  
  
	 		 	
	(Address)	 		 	
			
	 RECEIVED BY:
  
  
	 		 	
	(Authorized Dominion Homes, Inc. representative)	 		 	(Date)