KAUFMAN AND BROAD HOME CORPORATION
UNIT PERFORMANCE PROGRAM
SECTION 1. PURPOSE. The purposes of the Kaufman and Broad Home Corporation Unit Performance
Program (the "Program") are to promote the achievement of sustained long term growth in the shareholder value
of the Company by providing tangible, performance-driven compensation to Company executives for achieving
success against key performance measures, and to establish financial incentives to enhance the retention of key
SECTION 2. DEFINITIONS. As used in the Program, the following terms shall have the meanings set forth
"ACTUAL PERFORMANCE" shall mean the actual performance by the Company with respect to the
Performance Measures in effect for a Performance Period.
"AFFILIATE" shall mean (i) any entity that, directly or indirectly, is controlled by the Company and (ii) any entity
in which the Company has a significant equity interest, in either case as determined by the Committee.
"AWARD" shall mean an award of Performance Units to a Participant at the beginning of a Performance Period.
"AWARD AGREEMENT" shall mean any written agreement, contract, letter or other instrument or document
evidencing an Award, which may, but need not, be executed or acknowledged by a Participant.
"AWARD PAYOUT" shall mean the total payment, if any, made to a Participant in cash or in Shares, as shall be
determined by the Committee prior to the payment date, upon the vesting of Performance Units at the conclusion
of a Performance Period. The Award Payout shall be the product of (i) the number of Performance Units that
comprise the Award multiplied by (ii) the Unit Payout Factor multiplied by (iii) the stated dollar value of each
"BOARD" shall mean the Board of Directors of the Company.
"CHANGE OF OWNERSHIP" shall be deemed to have occurred if either (1) individuals who, as of the
effective date of this Program, constitute the Board of Directors of the Company (as of the date hereof, the