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Exhibit 10.14  


 
 

COMSTOCK HOMEBUILDING COMPANIES, INC.    
    




 
 

2004 EMPLOYEE STOCK PURCHASE PLAN    
    







 
 

COMSTOCK HOMEBUILDING COMPANIES, INC.
  
    2004 Employee Stock Purchase Plan    
    



	1.	 	Purpose	 	1
	2.	 	Definitions	 	1
	3.	 	Eligibility	 	3
	 	 	 	(a)	 	First Offering Date	 	3
	 	 	 	(b)	 	Subsequent Offering Dates	 	3
	4.	 	Offering Periods	 	3
	 	 	 	(a)	 	In General	 	3
	 	 	 	(b)	 	Automatic Reset of Offering Period	 	3
	 	 	 	(c)	 	Changes by Committee	 	4
	5.	 	Participation	 	3
	 	 	 	(a)	 	Entry Dates	 	4
	 	 	 	(b)	 	Special Rule for First Offering Date	 	4
	6.	 	Plan Contributions	 	4
	 	 	 	(a)	 	Contribution by Payroll Deduction	 	4
	 	 	 	(b)	 	Payroll Deduction Election on Enrollment Agreement	 	4
	 	 	 	(c)	 	Commencement of Payroll Deduction	 	4
	 	 	 	(d)	 	Automatic Continuation of Payroll Deductions	 	5
	 	 	 	(e)	 	Change of Payroll Deduction Election	 	5
	 	 	 	(f)	 	Automatic Changes in Payroll Deduction	 	5
	 	 	 	(g)	 	Special Rule for Initial Offering Period	 	5
	7.	 	Grant of Option	 	6
	 	 	 	(a)	 	Shares of Common Stock Subject to Option	 	6
	 	 	 	(b)	 	Exercise Price	 	6
	 	 	 	(c)	 	Fair Market Value	 	7
	 	 	 	(d)	 	Limitation on Option that may be Granted	 	7
	 	 	 	(e)	 	No Rights as Shareholder	 	7
	8.	 	Exercise of Options 7	 	 
	 	 	 	(a)	 	Automatic Exercise 7	 	 
	 	 	 	(b)	 	Carryover of Excess Contributions	 	8
	9.	 	Issuance of Shares	 	8
	 	 	 	(a)	 	Delivery of Shares	 	8
	 	 	 	(b)	 	Registration of Shares	 	8
	 	 	 	(c)	 	Compliance with Applicble Laws	 	8
	 	 	 	(d)	 	Withholding	 	8
	10.	 	Participant Accounts	 	8
	 	 	 	(a)	 	Bookkeeping Accounts Maintained	 	8
	 	 	 	(b)	 	Participant Account Statements	 	8
	 	 	 	(c)	 	Withdrawal of Account Balance Following Exercise Date	 	9
	11.	 	Designation of Beneficiary	 	9
	 	 	 	(a)	 	Designation	 	9
	 	 	 	(b)	 	Change of Designation	 	9
	12.	 	Transferability	 	9
	13.	 	Withdrawal; Termination of Employment	 	9
	 	 	 	(a)	 	Withdrawal	 	9
	 	 	 	(b)	 	Effect of Withdrawal on Subsequent Participation	 	10
	 	 	 	(c)	 	Termination of Employment	 	10
	14.	 	Common Stock Available under the Plan	 	10
	 	 	 	(a)	 	Number of Shares	 	10
	 	 	 	(b)	 	Adjustments Upon Changes in Capitalization; Corporate Transactions	 	10
	 	 	 	 	 	 	 	 









	15.	 	Administration	 	11
	 	 	 	(a)	 	Committee	 	11
	 	 	 	(b)	 	Requirements of Exchange Act 11	 	 
	16.	 	Amendment, Suspension, and Termination of the Plan	 	11
	 	 	 	(a)	 	Amendment of the Plan	 	12
	 	 	 	(b)	 	Suspension of the Plan	 	12
	 	 	 	(c)	 	Termination of the Plan	 	12
	17.	 	Notices	 	12
	18.	 	Expenses of the Plan	 	12
	19.	 	No Employment Rights	 	12
	20.	 	Applicable Law	 	13
	21.	 	Additional Restrictions of Rule 16b-3	 	13
	22.	 	Effective Date	 	13











 
 

COMSTOCK HOMEBUILDING COMPANIES, INC.    
    




 
 

2004 Employee Stock Purchase Plan    
    


        1.    Purpose. The purpose of the Plan is to provide an incentive for present and future employees of the Company and any
Designated Subsidiary to acquire a proprietary interest (or increase an existing proprietary interest) in the Company through the purchase of Common Stock. It is the Company's intention that the Plan
qualify as an "employee stock purchase plan" under Section 423 of the Code. Accordingly, the provisions of the Plan shall be administered, interpreted and construed in a manner consistent with
the requirements of that section of the Code. 


        2.        Definitions. 



        (a)    "Applicable Percentage" means the percentage specified in Section 7(b), subject to adjustment by the Committee as
provided in Section 7(b). 


        (b)    "Board" means the Board of Directors of the Company. 


        (c)    "Code" means the Internal Revenue Code of 1986, as amended, and any successor thereto. 



        (d)    "Committee" means the committee appointed by the Board to administer the Plan as described in Section 15 of the
Plan or, if no such Committee is appointed, the Board. 


        (e)    "Common Stock" means the Company's Class A common stock, par value $0.01 per share. 


        (f)    "Company" means Comstock Homebuilding Companies, Inc., a Delaware corporation. 



        (g)    "Compensation" means, with respect to each Participant for each pay period, the full base salary and overtime paid to
such Participant by the Company or a Designated Subsidiary. Except as otherwise determined by the Committee, "Compensation" does not include: (i) bonuses or commissions, (ii) any amounts
contributed by the Company or a Designated Subsidiary to any pension plan, (iii) any automobile or relocation allowances (or reimbursement for any such expenses), (iv) any amounts paid
as a starting bonus or finder's fee, (v) any amounts realized from the exercise of any stock options or incentive awards, (vi) any amounts paid by the Company or a Designated Subsidiary
for other fringe benefits, such as health and welfare, hospitalization and group life insurance benefits, or perquisites, or paid in lieu of such benefits, or (vii) other similar forms of
extraordinary compensation. 


        (h)    "Continuous Status as an Employee" means the absence of any interruption or termination of service as an Employee.
Continuous Status as an Employee shall not be considered interrupted in the case of a leave of absence agreed to in writing by the Company or the Designated Subsidiary that employs the Employee,
provided that such leave is for a period of not more than 90 days or reemployment upon the expiration of such leave is guaranteed by contract or statute. 



        (i)    "Designated Subsidiaries" means the Subsidiaries that have been designated by the Board from time to time in its sole
discretion as eligible to participate in the Plan. 


        (j)    "Employee" means any person, including an Officer, whose customary employment with the Company or one of its Designated
Subsidiaries is at least twenty (20) hours per week and more than five months in any calendar year. 


        (k)    "Exchange Act" means the Securities Exchange Act of 1934, as amended. 



        (l)    "Exercise Date" means the last Trading Day ending on or before the last day of each Offering Period. 


        (m)    "Exercise Price" means the price per share of Common Stock offered in a given Offering Period determined as provided in
Section 7(b). 








 




        (n)    "Fair Market Value" means, with respect to a share of Common Stock, the Fair Market Value as determined under
Section 7(c). 


        (o)    "First Offering Date" means the commencement date of the initial public offering contemplated by the Registration
Statement on Form S-1 filed by the Company with the Securities and Exchange Commission. 


        (p)    "Offering Date" means the first Trading Day of each Offering Period. 



        (q)    "Offering Period" means, subject to adjustment as provided in Section 4(b), the bi-monthly periods
during which the Company's Common Stock will be offered under the Plan, beginning on the first Trading Day on or after each January 1, March 1, May 1, July 1,
September 1, and November 1 and ending on the last Trading Day on or before the immediately following February 28, April 30, June 30, August 31,
October 31, and December 31 of each year while the Plan is in effect. The initial Offering Period shall be the period beginning on the First Offering Date and ending on the last Trading
Day on or before February 28, 2005. 


        (r)    "Officer" means a person who is an officer of the Company within the meaning of Section 16 under the Exchange Act
and the rules and regulations promulgated thereunder. 


        (s)    "Participant" means an Employee automatically enrolled in the Plan pursuant to Section 5(b) hereof, or an Employee
who has elected to participate in the Plan by filing an enrollment agreement with the Company as provided in Section 5(a) hereof. 



        (t)    "Plan" means this Comstock Homebuilding Companies, Inc. 2004 Employee Stock Purchase Plan. 


        (u)    "Plan Contributions" means, with respect to each Participant, the lump sum cash transfers, if any, made by the
Participant to the Plan pursuant to Section 6(a) or 6(g)(ii) hereof, plus the after-tax payroll deductions, if any, withheld from the Compensation of the Participant
and contributed to the Plan for the Participant as provided in Section 6 hereof, and any other amounts contributed to the Plan for the Participant in accordance with the terms of the Plan. 



        (v)    "Subsidiary" means any corporation, domestic or foreign, of which the Company owns, directly or indirectly, 50% or more
of the total combined voting power of all classes of stock, and that otherwise qualifies as a "subsidiary corporation" within the meaning of Section 424(f) of the Code. 


        (w)    "Trading Day" means a day on which the national stock exchanges and the Nasdaq system are open for trading. 




        3.    Eligibility. 



        (a)    First Offering Date. Any individual who is an Employee as of the First Offering Date shall be eligible to become a
Participant as of the First Offering Date. 


        (b)    Subsequent Offering Dates. Any Employee who has completed at least three (3) months of employment with the Company
or any Subsidiary shall be eligible to become a Participant as of any subsequent Offering Date under the Plan. 




        4.    Offering Periods. 



        (a)    In General. The Plan shall generally be implemented by a series of successive Offering Periods, with purchases of Common
Stock occurring on each Exercise Date. 


        (b)    Changes by Committee. 



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        (i)    The
Committee shall have the power to make changes to the duration and/or the frequency of Offering Periods with respect to future offerings if such change is announced
at least five days prior to the scheduled beginning of the first Offering Period to be affected. 


        (ii)    The
Committee may shorten the duration of any Offering Period then in progress, if such change is announced at least five days prior to the date on which the Committee
proposes that the Offering Period terminate. The Committee may shorten the Offering Period by setting a new Exercise Date, or by terminating the Offering Period and refunding any Plan Contributions
back to the Participants. 





        5.    Participation. 



        (a)    Entry Dates. Employees meeting the eligibility requirements of Section 3(b) hereof after the First Offering Date
may elect to participate in the Plan commencing on any Offering Date by completing an enrollment agreement on the form provided by the Company and filing the enrollment agreement with the Company on
or prior to such Offering Date, unless a later time for filing the enrollment agreement is set by the Committee for all eligible Employees with respect to a given offering. 


        (b)    Special Rule for First Offering Date. All Employees who are eligible as of the First Offering Date shall automatically
become Participants in the Plan as of the First Offering Date. 




        6.    Plan Contributions. 



        (a)    Contribution by Payroll Deduction. Contributions to the Plan generally shall be made only by payroll deductions. The
Committee may, but need not, permit Participants to make lump sum cash transfers to the Plan at such times and subject to such terms and conditions as the Committee may in its discretion determine,
and may from time to time require that all contributions with respect to an Offering Period be made solely by Participant lump sum cash transfers. All such additional contributions shall be made in a
manner consistent with the provisions of Section 423 of the Code or any successor thereto, and shall be treated in the same manner as payroll deductions contributed to the Plan as provided
herein. 


        (b)    Payroll Deduction Election on Enrollment Agreement. At the time a Participant files the enrollment agreement with respect
to an Offering Period, the Participant may authorize payroll deductions to be made on each payroll date during the portion of the Offering Period that he or she is a Participant in an amount not less
than 1% and not more than 10% of the Participant's Compensation on each payroll date. The amount of payroll deductions must be a whole percentage (e.g., 1%, 2%, 3%, etc.) of the Participant's
Compensation. 


        (c)    Commencement of Payroll Deductions. Except as otherwise determined by the Committee under rules applicable to all
Participants, payroll deductions for Participants enrolling in the Plan after the First Offering Date under Section 5(a) shall commence with the earliest administratively practicable payroll
period that begins on or after the Offering Date with respect to which the Participant files an enrollment agreement in accordance with Section 5(a). 


        (d)    Automatic Continuation of Payroll Deductions. Unless a Participant elects otherwise prior to the Exercise Date of any
Offering Period, such Participant shall be deemed (i) to have elected to participate in the immediately succeeding Offering Period and (ii) to have authorized the same payroll deduction
for the immediately succeeding Offering Period as was in effect for the Participant immediately prior to the commencement of the succeeding Offering Period. 


        (e)    Change of Payroll Deduction Election. A Participant may decrease or increase the rate or amount of his or her payroll
deductions during an Offering Period (within the limitations of Section 6(b) above) by completing and filing with the Company a new enrollment agreement authorizing a change in the rate or
amount of payroll deductions; provided, that a Participant may 



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not
change the rate or amount of his or her payroll deductions more than once in any Offering Period. Except as otherwise determined by the Committee under rules applicable to all Participants, the
change in rate or amount shall be effective as of the earliest administratively practicable payroll period that begins on or after the date the Committee receives the new enrollment agreement.
Additionally, a Participant may discontinue his or her participation in the Plan as provided in Section 13(a). 


        (f)    Automatic Changes in Payroll Deduction. Notwithstanding the foregoing, to the extent necessary to comply with
Section 423(b)(8) of the Code, Section 7(a) or 7(d) hereof, or any other applicable law, a Participant's payroll deductions may be decreased, including to 0%, at such time during any
Offering Period which is scheduled to end during the current calendar year that the aggregate of all payroll deductions accumulated with respect to such Offering Period and any other Offering Period
ending within the same calendar year are equal to the product of $25,000 multiplied by the Applicable Percentage for the calendar year. Payroll deductions shall recommence at the rate provided in the
Participant's enrollment agreement at the beginning of the next Offering Period which is scheduled to end in the following calendar year, unless the Participant terminates participation as provided in
Section 13(a). 


        (g)    Special Rule for Initial Offering Period.



        (i)    Prior to Effectiveness of Form S-8. No payroll deductions shall be made (and no payroll deduction
elections shall be accepted) by the Company for Participants during the initial Offering Period prior to the time that a registration statement with respect to the shares of Common Stock being offered
under the Plan has been filed with the Securities and Exchange Commission on Form S-8, and is effective. Each Participant shall be eligible to purchase shares of Common Stock on the
Exercise Date of such Offering Period in an amount equal to the lesser of (A) the aggregate purchase price for 400 shares of Common Stock or (B) ten (10%) percent of the Compensation
that the Participant receives during such Offering Period. 


        (ii)    Offering Period During Which Form S-8 Becomes Effective. Once the registration statement with respect
to the shares of Common Stock being offered under the Plan has been filed with the Securities Exchange Commission on Form S-8, and is effective, the Committee may permit a
Participant to make a payroll deduction election with respect to the Offering Period then in progress, by filing an enrollment agreement containing the payroll deduction election with the Company, as
provided in Section 6(b) above. If the Committee so permits, a Participant may at that time elect a lower level of participation than that provided in Section 6(g)(i) above, or
may withdraw from the Plan. If a payroll deduction election is made under this Section 6(g)(ii), payroll deductions may commence as early as with the first pay period beginning after the First
Offering Date. Subject to the overall participation level specified in Section 6(g)(i), the rate of payroll deduction during the Offering Period during which the Form S-8
becomes effective may exceed the maximum permitted rate under Section 6(b) hereof to make up for the payroll deductions, if any, which would otherwise have been made prior to the effectiveness
of the Form S-8 with respect to the Plan. If a payroll deduction election is made under this Section 6(g)(ii), payroll deductions shall continue at the rate elected by the
Participant for subsequent Offering Periods, unless the Participant makes a change permitted under Section 6(e), or withdraws from the Plan under Section 13(a). Alternatively, the
Committee may permit or require purchases on the Exercise Date of the initial Offering Period to be made by direct lump sum cash transfer by the Participant. 


        (iii)    Subsequent Offering Periods. For all Offering Periods subsequent to the Offering Period during which the Company's
Form S-8 with respect to the Plan becomes effective, purchases generally must be made via payroll deduction. Participants in the Offering Period 




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during
which the Form S-8 becomes effective who do not make a payroll deduction election pursuant to Section 6(g)(ii) must file an enrollment agreement containing a
payroll deduction election with respect to subsequent Offering Periods with the Company prior to the commencement of a subsequent Offering Period (unless a later time for filing is set by the
Committee for all Participants) in order to make further purchases under the Plan. Payroll deductions for Participants required to file a payroll deduction election under this
Section 6(g)(iii) shall commence, except as otherwise determined by the Committee under rules applicable to all Participants, effective as of the earliest administratively practicable
payroll period that begins on or after the first day of the subsequent Offering Period. A Participant who does not timely file an enrollment agreement shall be treated as having withdrawn under
Section 13(a) hereof. 





        7.    Grant of Option. 



        (a)    Shares of Common Stock Subject to Option. Subject to the limitations set forth in Section 7(d) and this
Section 7(a), a Participant shall be granted an option on each Offering Date to purchase on the next Exercise Date (at the Exercise Price determined as provided in Section 7(b) below) up
to a number of shares of Common Stock determined by dividing such Participant's Plan Contributions accumulated prior to such Exercise Date and retained in the Participant's account as of such Exercise
Date by the Exercise Price; provided, that the maximum number of shares a Participant may purchase on any Exercise Date shall be 400, and that no Participant may purchase in any one calendar year
Common
Stock having a cumulative Fair Market Value (determined as of the time such Common Stock is purchased) of more than $6,000. 


        (b)    Exercise Price. 



        (i)    Subject
to Clause (ii) below, the Exercise Price per share of Common Stock offered to each Participant in a given Offering Period shall be the Applicable
Percentage of the Fair Market Value of a share of Common Stock on the Exercise Date. 


        (ii)    The
Committee may, in its sole discretion, determine that the Exercise Price per share of Common Stock offered to each Participant in a given Offering Period shall be
the lower of: (1) the Applicable Percentage of the Fair Market Value of a share of Common Stock on the Offering Date or (2) the Applicable Percentage of the Fair Market Value of a share
of Common Stock on the Exercise Date, provided the Committee announces such change at least five days prior to the Offering Date thereof. 



        (iii)    The
Applicable Percentage with respect to each Offering Period shall be 85%, unless and until such Applicable Percentage is increased by the Committee, in its sole
discretion, provided that any such increase in the Applicable Percentage with respect to a given Offering Period must be established not less than five days prior to the Offering Date thereof. 




        (c)    Fair Market Value. The Fair Market Value of a share of Common Stock on a given date shall be determined by the Committee
in its discretion; provided, that if there is a public market for the Common Stock, the Fair Market Value per share shall be either (i) the closing price of the Common Stock on such date (or,
in the event that the Common Stock is not traded on such date, on the immediately preceding trading date), as reported by the National Association of Securities Dealers Automated Quotation (Nasdaq)
National Market System, (ii) if such price is not reported, the average of the bid and asked prices for the Common Stock on such date (or, in the event that the Common Stock is not traded on
such date, on the immediately preceding trading date), as reported by Nasdaq, (iii) in the event the Common Stock is listed on a stock exchange, the closing price of the Common Stock on such
exchange on such date (or, in the event that the Common Stock is not traded on such date, on the immediately preceding trading date), For purposes of the 



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First
Offering Date, the Fair Market Value of a share of Common Stock shall be the Price to Public as set forth in the final prospectus filed by the Company with the Securities and Exchange Commission
pursuant to Rule 424 under the Securities Act of 1933, as amended. 


        (d)    Limitation on Option that may be Granted. Notwithstanding any provision of the Plan to the contrary, no Participant shall
be granted an option under the Plan (i) to the extent that if, immediately after the
grant, such Employee (or any other person whose stock would be attributed to such Employee pursuant to Section 424(d) of the Code) would own stock and/or hold outstanding options to purchase
stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or of any Subsidiary of the Company, or (ii) to the extent that his or her rights
to purchase stock under all employee stock purchase plans of the Company and its Subsidiaries intended to qualify under Section 423 of the Code accrue at a rate which exceeds $25,000 of fair
market value of stock (determined at the time such option is granted) for each calendar year in which such option is outstanding at any time. 


        (e)    No Rights as Shareholder. A Participant will have no interest or voting right in shares covered by his or her option
until such option has been exercised. 




        8.    Exercise of Options. 



        (a)    Automatic Exercise. A Participant's option for the purchase of shares will be exercised automatically on each Exercise
Date, and the maximum number of full shares subject to the option shall be purchased for the Participant at the applicable Exercise Price with the accumulated Plan Contributions then credited to the
Participant's account under the Plan. During a Participant's lifetime, a Participant's option to purchase shares hereunder is exercisable only by the Participant. 



        (b)    Carryover of Excess Contributions. Any amount remaining to the credit of a Participant's account after the purchase of
shares by the Participant on an Exercise Date, or which is insufficient to purchase a full share of Common Stock, shall remain in the Participant's account, and be carried over to the next Offering
Period, unless the Participant withdraws from participation in the Plan or elects to withdraw his or her account balance in accordance with Section 10(c). 




        9.    Issuance of Shares. 



        (a)    Delivery of Shares. As promptly as practicable after each Exercise Date, the Company shall arrange for the delivery to
each Participant (or the Participant's beneficiary), as appropriate, or to a custodial account for the benefit of each Participant (or the Participant's beneficiary) as appropriate, of a certificate
representing the shares purchased upon exercise of the Participant's option. 


        (b)    Registration of Shares. Shares to be delivered to a Participant under the Plan will be registered in the name of the
Participant or in the name of the Participant and his or her spouse, as requested by the Participant. 


        (c)    Compliance with Applicable Laws. The Plan, the grant and exercise of options to purchase shares under the Plan, and the
Company's obligation to sell and deliver shares upon the exercise of options to purchase shares shall be subject to compliance with all applicable federal, state and foreign laws, rules and
regulations and the requirements of any stock exchange on which the shares may then be listed. 



        (d)    Withholding. The Company may make such provisions as it deems appropriate for withholding by the Company pursuant to
federal or state tax laws of such amounts as the Company determines it is required to withhold in connection with the purchase or sale by a Participant of any Common Stock acquired pursuant to the
Plan. The Company may require a Participant to 



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satisfy
any relevant tax requirements before authorizing any issuance of Common Stock to such Participant. 




        10.    Participant Accounts. 



        (a)    Bookkeeping Accounts Maintained. Individual bookkeeping accounts will be maintained for each Participant in the Plan to
account for the balance of his Plan Contributions, options issued, and shares purchased under the Plan. However, all Plan Contributions made for a Participant shall be deposited in the Company's
general corporate accounts, and no interest shall accrue or be credited with respect to a Participant's Plan Contributions. All Plan Contributions received or held by the Company may be used by the
Company for any corporate purpose, and the Company shall not be obligated to segregate or otherwise set apart such Plan Contributions from any other corporate funds. 


        (b)    Participant Account Statements. Statements of account will be given to Participants semi-annually in due
course following each Exercise Date, which statements will set forth the amounts of payroll deductions, the per share purchase price, the number of shares purchased and the remaining cash balance, if
any. 


        (c)    Withdrawal of Account Balance Following Exercise Date. A Participant may elect at any time within the first thirty
(30) days following any Exercise Date, or at such other time as the Committee may from time to time prescribe, to receive in cash any amounts carried-over in accordance with
Section 8(b). An election under this Section 10(c) shall not be treated as a withdrawal from participation in the Plan under Section 13(a). 




        11.    Designation of Beneficiary. 



        (a)    Designation. A Participant may file a written designation of a beneficiary who is to receive any shares and cash,
if any, from the Participant's account under the Plan in the event of the Participant's death subsequent to an Exercise Date on which the Participant's option hereunder is exercised but prior to
delivery to the Participant of such shares and cash. In addition, a Participant may file a written designation of a beneficiary who is to receive any cash from the Participant's account under
the Plan in the event of the Participant's death prior to the exercise of the option. 



        (b)    Change of Designation. A Participant's beneficiary designation may be changed by the Participant at any time by written
notice. In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the
Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the Participant, or if no spouse, dependent or relative is known to the
Company, then to such other person as the Company may designate. 




        12.    Transferability. Neither Plan Contributions credited to a Participant's account nor any rights to exercise any option or
receive shares of Common Stock under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will or the laws of descent and distribution, or as provided in
Section 11). Any attempted assignment, transfer, pledge or other distribution shall be without effect, except that the Company may treat such act as an election to withdraw in accordance with
Section 13(a). 


        13.    Withdrawal; Termination of Employment. 



        (a)    Withdrawal. A Participant may withdraw from the Plan at any time after the Company's registration statement on
Form S-8 with respect to the Plan is effective by giving written notice to 



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the
Company. Payroll deductions, if any have been authorized, shall cease as soon as administratively practicable after receipt of the Participant's notice of withdrawal, and, subject to
administrative practicability, no further purchases shall be made for the Participant's account. All Plan Contributions credited to the Participant's account, if any, and not yet invested in Common
Stock, will be paid to the Participant as soon as administratively practicable after receipt of the Participant's notice of withdrawal. The Participant's unexercised options to purchase shares
pursuant to the Plan automatically will be terminated. Payroll deductions will not resume on behalf of a Participant who has withdrawn from the Plan (a "Former Participant") unless the Former
Participant enrolls in a subsequent Offering Period in accordance with Section 5(a) and subject to the restriction provided in Section 13(b), below. 


        (b)    Effect of Withdrawal on Subsequent Participation. A Former Participant who has withdrawn from the Plan pursuant to this
Section 13(b) shall not again be eligible to participate in the Plan prior to the
beginning of the Offering Period that commences at least 12 months from the date the Former Participant withdrew, and the Former Participant must submit a new enrollment agreement in order to
again become a Participant as of that date. 


        (c)    Termination of Employment. Upon termination of a Participant's Continuous Status as an Employee prior to any Exercise
Date for any reason, including retirement or death, the Plan Contributions credited to the Participant's account and not yet invested in Common Stock will be returned to the Participant or, in the
case of death, to the Participant's beneficiary as determined pursuant to Section 11, and the Participant's option to purchase shares under the Plan will automatically terminate. 




        14.    Common Stock Available under the Plan. 



        (a)    Number of Shares. Subject to adjustment as provided in Section 14(b) below, the maximum number of shares of the
Company's Common Stock that shall be made available for sale under the Plan shall be 200,000 shares, plus an automatic annual increase on the first day of each of the Company's fiscal years beginning
in 2005 and ending in 2014 equal to the lesser of (i) 100,000 shares, (ii) 1% of all shares of Common Stock outstanding on the last day of the immediately preceding fiscal year, or
(iii) a lesser amount determined by the Board. Shares of Common Stock subject to the Plan may be newly issued shares or shares reacquired in private transactions or open market purchases. If
and to the extent that any right to purchase reserved shares shall not be exercised by any Participant for any reason or if such right to purchase shall terminate as provided herein, shares that have
not been so purchased hereunder shall again become available for the purpose of the Plan unless the Plan shall have been terminated, but all shares sold under the Plan, regardless of source, shall be
counted against the limitation set forth above. 




        (b)    Adjustments Upon Changes in Capitalization; Corporate Transactions. 




	i.
	If
the outstanding shares of Common Stock are increased or decreased, or are changed into or are exchanged for a different number or kind of shares, as a result of one or
more reorganizations, restructurings, recapitalizations, reclassifications, stock splits, reverse stock splits, stock dividends or the like, upon authorization of the Committee, appropriate
adjustments shall be ade in the number and/or kind of shares, and the per-share option price thereof, which may be issued in the aggregate and to any Participant upon exercise of options
granted under the Plan.



	ii.
	In
the event of the proposed dissolution or liquidation of the Company, the Offering Period will terminate immediately prior to the consummation of such proposed action,
unless otherwise provided by the Committee. 




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	iii.
	In
the event of a proposed sale of all or substantially all of the Company's assets, or the merger of the Company with or into another corporation (each, a "Sale
Transaction"), each option under the Plan shall be assumed or an equivalent option shall be substituted by such successor corporation or a parent or subsidiary of such successor corporation, unless
the Committee determines, in the exercise of its sole discretion and in lieu of such assumption or substitution, to shorten the Offering Period then in progress by setting a new Exercise Date (the
"New Exercise Date"). If the Committee shortens the Offering Period then in progress in lieu of assumption or substitution in the event of a Sale Transaction, the Committee shall notify each
Participant in writing, at least ten (10) days prior to the New Exercise Date, that the exercise date for such Participant's option has been changed to the New Exercise Date and that such
Participant's option will be exercised automatically on the New Exercise Date, unless prior to such date the Participant has withdrawn from the Plan as provided in Section 13(a). For purposes
of this Section 14(b), an option granted under the Plan shall be deemed to have been assumed if, following the Sale Transaction, the option confers the right to purchase, for each share of
option stock subject to the option immediately prior to the Sale Transaction, the consideration (whether stock, cash or other securities or property) received in the Sale Transaction by holders of
Common Stock for each share of Common Stock held on the effective date of the Sale Transaction (and if such holders were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding shares of Common Stock); provided, that if the consideration received in the Sale Transaction was not solely common stock of the successor corporation or its
parent (as defined in Section 424(e) of the Code), the Committee may, with the consent of the successor corporation and the Participant, provide for the consideration to be received upon
exercise of the option to be solely common stock of the successor corporation or its parent equal in fair market value to the per share consideration received by the holders of Common Stock in the
Sale Transaction.



	iv.
	In
all cases, the Committee shall have sole discretion to exercise any of the powers and authority provided under this Section 14, and the Committee's actions
hereunder shall be final and binding on all Participants. No fractional shares of stock shall be issued under the Plan pursuant to any adjustment authorized under the provisions of this
Section 14. 





        15.
Administration. 



        (a)    Committee. The Plan shall be administered by the Committee. The Committee shall have the authority to interpret the Plan,
to prescribe, amend and rescind rules and regulations relating to the
Plan, and to make all other determinations necessary or advisable for the administration of the Plan. The administration, interpretation, or application of the Plan by the Committee shall be final,
conclusive and binding upon all persons. 


        (b)    Requirements of Exchange Act. Notwithstanding the provisions of Section 15(a) above, in the event that
Rule 16b-3 promulgated under the Exchange Act or any successor provision thereto ("Rule 16b-3") provides specific requirements for the administrators of plans of
this type, the Plan shall only be administered by such body and in such a manner as shall comply with the applicable requirements of Rule 16b-3. Unless permitted by
Rule 16b-3, no discretion concerning decisions regarding the Plan shall be afforded to any person that is not "disinterested" as that term is used in Rule 16b-3. 




        16.    Amendment, Suspension, and Termination of the Plan. 



        (a)    Amendment of the Plan. The Board or the Committee may at any time, or from time to time, amend the Plan in any respect;
provided, that (i) except as otherwise provided in Section 4(c) hereof, no such amendment may make any change in any option theretofore granted 



9







 

which
adversely affects the rights of any Participant and (ii) the Plan may not be amended in any way that will cause rights issued under the Plan to fail to meet the requirements for employee
stock purchase plans as defined in Section 423 of the Code or any successor thereto. To the extent necessary to comply with Rule 16b-3 under the Exchange Act,
Section 423 of the Code, or any other applicable law or regulation), the Company shall obtain shareholder approval of any such amendment. 



        (b)    Suspension of the Plan. The Board or the Committee may, as of the close of any Exercise Date, suspend the Plan; provided,
that the Board or Committee provides notice to the Participants at least five business days prior to the suspension. The Board or Committee may resume the normal operation of the Plan as of any
Exercise Date; provided further, that the Board or Committee provides notice to the Participants at least 20 business days prior to the date of termination of the suspension period. A Participant
shall remain a Participant in the Plan during any suspension period (unless he or she withdraws pursuant to Section 13(a)), however no options shall be granted or exercised, and no payroll
deductions shall be made in respect of any Participant during the suspension period. Participants shall have the right to withdraw carryover funds provided in Section 10(c) throughout any
suspension period. The Plan shall resume its normal operation upon termination of a suspension period. 


        (c)    Termination of the Plan. The Plan and all rights of Employees hereunder shall terminate on the earliest of: 



	i.
	the
Exercise Date that Participants become entitled to purchase a number of shares greater than the number of reserved shares remaining available for purchase under the
Plan;



	ii.
	such
date as is determined by the Board in its discretion; or



	iii.
	the
last Exercise Date immediately preceding the tenth (10th) anniversary of the Plan's effective date. 





        In
the event that the Plan terminates under circumstances described in Section 16(c)(i) above, reserved shares remaining as of the termination date shall be sold to
Participants on a pro rata basis, based on the relative value of their cash account balances in the Plan as of the termination date. 



        17.    Notices. All notices or other communications by a Participant to the Company under or in connection with the Plan shall
be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof. 


        18.    Expenses of the Plan. All costs and expenses incurred in administering the Plan shall be paid by the Company, except that
any stamp duties or transfer taxes applicable to participation in the Plan may be charged to the account of such Participant by the Company. 



        19.    No Employment Rights. The Plan does not, directly or indirectly, create any right for the benefit of any employee or
class of employees to purchase any shares under the Plan, or create in any employee or class of employees any right with respect to continuation of employment by the Company or any Subsidiary, and it
shall not be deemed to interfere in any way with the right of the Company or any Subsidiary to terminate, or otherwise modify, an employee's employment at any time. 


        20.    Applicable Law. The internal laws of the State of Delaware shall govern all matters relating to this Plan except to the
extent (if any) superseded by the laws of the United States. 


        21.    Additional Restrictions of Rule 16b-3. The terms and conditions of options granted hereunder to, and
the purchase of shares by, persons subject to Section 16 of the Exchange Act shall comply with the applicable provisions of Rule 16b-3. This Plan shall be deemed to contain,
and such options shall contain, and the shares issued upon exercise thereof shall be subject to, such additional conditions and 


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restrictions
as may be required by Rule 16b-3 to qualify for the maximum exemption from Section 16 of the Exchange Act with respect to Plan transactions. 


        22.    Effective Date. Subject to adoption of the Plan by the Board and approval of the Plan by the shareholders of the Company,
the Plan shall become effective on the First Offering Date. The Board shall submit the Plan to the shareholders of the Company for approval within twelve months after the date the Plan is adopted by
the Board. 


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QuickLinks


COMSTOCK HOMEBUILDING COMPANIES, INC.

2004 EMPLOYEE STOCK PURCHASE PLAN

COMSTOCK HOMEBUILDING COMPANIES, INC. 2004 Employee Stock Purchase Plan



COMSTOCK HOMEBUILDING COMPANIES, INC.

2004 Employee Stock Purchase Plan