Exhibit 10(bb)
2008 HOVNANIAN ENTERPRISES, INC.
STOCK INCENTIVE PLAN
INCENTIVE STOCK OPTION AGREEMENT
Participant:
Date of Grant:
Number of Class A Shares:
Grant Price:
Vesting Schedule:
Date
Number of Shares
Option Termination Date:
1.
GRANT OF THE OPTION. FOR VALUABLE CONSIDERATION, RECEIPT OF WHICH IS
HEREBY ACKNOWLEDGED, HOVNANIAN ENTERPRISES, INC., A DELAWARE CORPORATION (THE
"COMPANY"), HEREBY GRANTS THE RIGHT AND OPTION (THE "OPTION") TO PURCHASE, ON
THE TERMS AND CONDITIONS HEREINAFTER SET FORTH, ALL OR ANY PART OF AN AGGREGATE
NUMBER OF CLASS A SHARES SET FORTH ABOVE. THIS GRANT IS MADE SUBJECT TO THE
TERMS AND CONDITIONS OF THE 2008 COMPANY STOCK INCENTIVE PLAN (THE "PLAN"),
WHICH PLAN IS INCORPORATED HEREIN BY REFERENCE AND SUBJECT TO AMENDMENTS TO THE
PLAN. THE PURCHASE PRICE OF THE SHARES SUBJECT TO THE OPTION (THE "GRANT PRICE")
SHALL BE THE PRICE PER SHARE SET FORTH ABOVE.
THIS OPTION IS AN INCENTIVE STOCK
OPTION WITHIN THE MEANING OF SECTION 422 OF THE INTERNAL REVENUE CODE OF 1986
(THE "CODE").
2.
VESTING. THIS OPTION WILL VEST IN ACCORDANCE WITH THE SCHEDULE SET FORTH
ABOVE, SUBJECT TO SECTION 3 OF THIS AGREEMENT.
3.
EXERCISE OF OPTION.
(A)
PERIOD OF EXERCISE.
(I)
IN GENERAL. THE OPTION MUST BE EXERCISED BEFORE THE OPTION
TERMINATION DATE SET FORTH ABOVE (THE "OPTION TERMINATION DATE").
THE
PARTICIPANT MAY EXERCISE LESS THAN THE FULL INSTALLMENT AVAILABLE TO HIM OR HER
UNDER THIS OPTION, BUT THE PARTICIPANT MUST EXERCISE THIS OPTION IN FULL SHARES
OF THE COMMON STOCK OF THE COMPANY.
THE PARTICIPANT IS LIMITED TO TEN EXERCISES
DURING THE TERM OF THIS OPTION.
1
(II)
TERMINATION OF EMPLOYMENT OTHER THAN DUE TO DEATH, DISABILITY OR
RETIREMENT. IF, PRIOR TO THE OPTION TERMINATION DATE, THE PARTICIPANT CEASES TO
BE EMPLOYED BY THE COMPANY OR A SUBSIDIARY THEREOF (OTHERWISE THAN BY REASON OF
DEATH, DISABILITY OR RETIREMENT), THE NONVESTED PORTION OF THE OPTION SHALL BE
CANCELED AND THE VESTED PORTION OF THE OPTION, TO THE EXTENT NOT PREVIOUSLY
EXERCISED, SHALL REMAIN EXERCISABLE UNTIL THE EARLIER OF (A) THE OPTION
TERMINATION DATE AND (B) THE SIXTIETH (60TH) DAY AFTER THE DATE OF CESSATION OF
EMPLOYMENT, AND THEREAFTER ALL OPTIONS, TO THE EXTENT NOT PREVIOUSLY EXERCISED,
SHALL TERMINATE TOGETHER WITH ALL OTHER RIGHTS HEREUNDER.
THIS OPTION SHALL BE
WHOLLY VOID AND OF NO EFFECT AFTER THE OPTION TERMINATION DATE.
FOR PURPOSES OF
THIS AGREEMENT, "DISABILITY" SHALL MEAN DISABILITY WITHIN THE MEANING OF
SECTION 22(E)(3) OF THE CODE, AND "RETIREMENT" SHALL MEAN TERMINATION OF
EMPLOYMENT ON OR AFTER AGE 60, OR ON OR AFTER AGE 58 WITH AT LEAST 15 YEARS OF
"SERVICE" TO THE COMPANY AND ITS SUBSIDIARIES IMMEDIATELY PRECEDING SUCH
TERMINATION OF EMPLOYMENT.
FOR THIS PURPOSE, "SERVICE" MEANS THE PERIOD OF
EMPLOYMENT IMMEDIATELY PRECEDING RETIREMENT, PLUS ANY PRIOR PERIODS OF
EMPLOYMENT WITH THE COMPANY AND ITS SUBSIDIARIES OF ONE OR MORE YEARS' DURATION,
UNLESS THEY WERE SUCCEEDED BY A PERIOD OF NON-EMPLOYMENT WITH THE COMPANY AND
ITS SUBSIDIARIES OF MORE THAN THREE YEARS' DURATION.
(III)
TERMINATION OF EMPLOYMENT DUE TO DEATH. IF, PRIOR TO