| 11. Ara K. Hovnanian, Hovnanian Enterprises | 2014 Salary | % Total |
| % Change Vs. 2013 | Breakdown ($) | Comp |
| -33.24% | ||
| Base salary | 1,092,606 | 18.47% |
| Bonus | 0 | 0.00% |
| Stock Awards | 3,433,500 | 58.03% |
| Options Awards | 0 | 0.00% |
| Non-Equity Incentive | 1,140,293 | 19.27% |
| Change in Pension Value | 0 | 0.00% |
| All Other Comp | 250,220 | 4.23% |
| TOTAL COMP | 5,916,619 |
- Hovnanian’s base salary was unchanged from 2013
- The non-equity incentive of $1,140,293 was based on achieving targets for the company’s pre-tax profit based on its return on average capital employed, capped at $2.5 million. “The CEO’s 2014 cash bonus was entirely attributed to the Pre-tax Profit plus Liquidity Balances Calculation Method of his bonus formula. Fiscal 2014 Pre-tax Profit was $26.6 million … and the Liquidity balances at the end of all four fiscal 2014 quarters were above $170 million. As a result, Mr. Hovnanian earned a cash bonus equal to $1,140,293, which represented a 24% decrease from his fiscal 2013 bonus.”
- The $3,433,500 in stock awards reflects the grant date fair value of the MSUs Hovnanian was granted in 2014. All told, 600,000 target MSUs were given in 2014, same as in 2013 (though in 2013 it was made in the form of stock options), but split into two incentive targets, subject to the stock price and other financial performance conditions, of 300,000 shares. The grant date fair value of the awards were $1,705,500 and $1,728,000.
