DEF 14A of KB Home, Mar 7, 2025

DEF 14A of KB Home

Filed Mar 7, 2025 · FY20240001308179-25-000054

Open on EDGAR

  1. Jeffrey T. Mezger

    | | Non-Qualified Deferred Compensation During Fiscal Year 2024 | 45 | | | Pay Versus Performance | 45 | | | CEO Pay Ratio | 48 | | | Potential Payments Upon Termination of Employment or Change in Control | 48 | | ■ | Advisory Vote to Approve Named Executive Officer Compensation | 53 | | | Responsiveness to Stockholders | 53 | | | Pay for Performance and 2024 Fiscal Year CEO Compensation | 54 | | ■ | Ratify Ernst & Young LLP’s Appointment as Independent Auditor | 56 | | | Independent Auditor Services and Fees | 56 | | | Audit Committee Report | 57 | | ■ | Annual Meeting Voting Matters and Other Information | 58 | | | Voting Your Shares | 58 | | | Voting Standards | 58 | | | Voting Procedures | 58 | | | Proxy Solicitation Costs | 59 | | | Internet Availability of Proxy Materials | 59 | | | Stockholder Proposals for Our 2026 Annual Meeting of Stockholders | 59 | | ■ | Commitment to Sustainability | 60 | | ■ | Annex 1 Corporate Governance Processes and Procedures | 62 | | | Director Independence Determinations | 62 | | | Related Party Transactions | 62 | | | Director Qualifications and Nominations | 63 | | | Board Evaluation Process | 63 | | | Audit Fee Pre-Approval Policy; Audit Committee Designation | 63 | | ■ | Annex 2 Reconciliation of Non-GAAP Financial Measures | 64 |

  2. Director Compensation

    Director Compensation The Compensation Committee periodically evaluates, with FWC’s assistance, and makes recommendations to the Board regarding compensation and benefits for non-employee directors, with attention to maintaining competitive positioning relative to peer public homebuilders and similarly situated companies. Non-employee director compensation was last adjusted in July 2019. Directors, other than Mr. Mezger, who is not paid for his Board service, are compensated as described below. We also pay directors’ travel-related expenses for Board meetings and Board activities. Our director compensation program is shown in the table below. Directors elected to the Board other than at an annual meeting receive prorated compensation.

  3. Non-Employee Director Compensation

    Non-Employee Director Compensation

  4. Non-Employee Director Compensation

    | ■ | Lead Independent Director Retainer - $40,000 | | ■ | Committee Retainers: |

  5. Non-Employee Director Compensation

    | | Chair | Member | | Audit | $27,500 | $12,500 | | Compensation | $21,000 | $10,000 | | Nominating | $20,000 | $10,000 |

  6. Non-Employee Director Compensation

    | ■ | Meeting Fees – $1,500 per applicable meeting |

  7. Non-Employee Director Compensation

    Retainers Each director may elect to receive retainers in equal quarterly cash installments, in unrestricted shares of our common stock or in deferred common stock awards (“stock units”). Equity-based grants are made as described below. Equity Grants Except as noted below, each director may elect to receive their equity grant in common stock or stock units. Grants are made on election to the Board, with the rounded number of shares/units based on our common stock’s grant date closing price. Directors receive a share of our common stock for each stock unit they hold on the earlier of a change in control or leaving the Board. Directors receive cash dividends on their common stock holdings and cash dividend equivalent payments on their stock units. Stock units have no voting rights. If a director has not satisfied their stock ownership requirement (see under “Stock Ownership Requirements”), they can receive only stock units for their equity grant and must hold all shares of common stock until they satisfy the requirement or leave the Board. Meeting Fees Directors receive fees for each non-regularly scheduled Board or committee meeting they attend if they have also attended all the same body’s prior meetings during the applicable Director Year, which is the period between our annual meetings. Indemnification Agreements We have agreements with our directors, which were updated in January 2024, that provide them with indemnification and advancement of expenses to supplement what our Certificate of Incorporation and insurance policies provide, subject to certain limitations.

  8. Non-Employee Director Compensation

    | 12 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  9. Non-Employee Director Compensation

    | Director Compensation Director Compensation During Fiscal Year 2024 |

  10. Director Compensation During Fiscal Year 2024

    Director Compensation During Fiscal Year 2024

  11. Director Compensation During Fiscal Year 2024

    | Name | Fees Earned or Paid in Cash ($)(a) | Stock Awards ($)(b) | All Other Compensation ($)(c) | Total ($) | | Mr. Barra | $100,000 | $185,000 | $1,500 | $286,500 | | Mr. Collins | 100,000 | 182,500 | — | 282,500 | | Ms. Dominguez | 100,000 | 175,000 | 3,000 | 278,000 | | Mr. Eltife | 122,500 | 162,500 | 3,000 | 288,000 | | Dr. Gabriel | 112,500 | 162,500 | 1,500 | 276,500 | | Dr. Gilligan | 137,500 | 162,500 | 3,000 | 303,000 | | Ms. Henry | 27,500 | 81,250 | — | 108,750 | | Ms. Kozlak | 121,000 | 202,500 | 1,500 | 325,000 | | Ms. Lora | — | — | 3,000 | 3,000 | | Mr. Niccol | — | — | 3,000 | 3,000 | | Mr. Weaver | 130,000 | 162,500 | — | 292,500 |

  12. Director Compensation During Fiscal Year 2024

    | (a) Fees Earned or Paid in Cash. These amounts generally represent cash retainers paid to directors per their individual elections. The amount for Ms. Kozlak includes her Lead Independent Director retainer. Ms. Lora and Mr. Niccol each served during our 2024 fiscal year until they stepped down from the Board on April 18, 2024. | | (b) Stock Awards. These amounts represent the aggregate grant date fair value of the shares of our common stock or stock units granted to our directors in 2024 based on their individual elections with regard to their retainers and type of equity grant (i.e., shares or stock units). The grant date fair value of each such award is equal to the closing price of our common stock on the date of grant. All grants were made on April 18, 2024, except for Ms. Henry, who received her grant upon her being elected to the Board on October 10, 2024. The table below shows the respective grants to our directors in 2024. |

  13. Director Compensation During Fiscal Year 2024

    | Name | 2024 Common Stock Grants (#) | 2024 Stock Unit Grants (#) | | Mr. Barra | 3,061 | — | | Mr. Collins | 3,020 | — | | Ms. Dominguez | 2,895 | — | | Mr. Eltife | 2,689 | — | | Dr. Gabriel | 2,689 | — | | Dr. Gilligan | — | 2,689 | | Ms. Henry | 1,018 | — | | Ms. Kozlak | — | 3,351 | | Mr. Weaver | — | 2,689 |

  14. Director Compensation During Fiscal Year 2024

    | The aggregate number of outstanding equity awards held by our non-employee directors at the end of our 2024 fiscal year are shown under “Ownership of KB Home Securities.” | | (c) All Other Compensation. These amounts are additional meetings fees paid in 2024 for Board, Compensation Committee and Nominating Committee meetings during the 2023-2024 Director Year. |

  15. Director Compensation During Fiscal Year 2024

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 13 |

  16. Director Compensation During Fiscal Year 2024

    | Election of Directors | |

  17. Director Compensation During Fiscal Year 2024

    The Board will present as nominees at the Annual Meeting, and recommends our stockholders elect to the Board, each of the individuals named below for a one-year term ending at the election of directors at our 2026 annual meeting. Other than Ms. Henry, who was elected to the Board in October 2024, each nominee is standing for re-election. Each nominee has consented to being nominated and agreed to serve as a director if elected. Should any of the nominees become unable to serve as a director prior to the Annual Meeting, the named proxies, unless otherwise directed, may vote for the election of another person as the Board may recommend. If the Board’s nominees below are elected at the Annual Meeting, the Board will have ten directors.

  18. Long-Term Growth

    Long-Term Growth Over the five-year period from 2019 to 2024, we generated significant improvements in the financial metrics identified below.

  19. Long-Term Growth

    | n | Total revenues rose from $4.55 billion to $6.93 billion, a 52% increase. | | n | Pretax income grew from $348.2 million to $850.9 million, up 144%. | | n | Net income increased from $268.8 million to $655.0 million, also a 144% improvement. | | n | Diluted earnings per share rose from $2.85 to $8.45, up 196%. | | n | Book value per share improved 112%, from $26.60 to $56.27, reflecting the impact of our common stock repurchases. | | n | Debt to capital ratio improved significantly from 42.3% to 29.4%. |

  20. Long-Term Growth

    In particular, we achieved strong total revenues, net income, and diluted earnings per share results, as well as improvement in book value per share, over the period illustrated in the charts below.

  21. Long-Term Growth

    | Total Revenues ($ in millions) | Net Income ($ in millions) | | | | | Diluted Earnings Per Share | Book Value Per Share | | | |

  22. Long-Term Growth

    | 24 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  23. Long-Term Growth

    | Compensation Discussion and Analysis Pay For Performance — 2024 Fiscal Year CEO Compensation |

  24. Pay For Performance — 2024 Fiscal Year CEO Compensation

    | n | Approximately 93% of our CEO’s 2024 total direct compensation (i.e., value of base salary and annual incentive award, and target value of long-term incentive award), was performance-based. His base salary has remained the same since 2017. | | n | While we achieved strong financial and operational performance in 2024, to better balance his cash and equity incentives, and enhance both retention and stockholder value creation, our CEO’s total annual incentive payout was approximately $1.16 million, or 13%, lower than the prior year, with a portion paid in three-year, ratable time-vesting restricted stock in lieu of cash. The $6.3 million portion paid in cash was nearly $1.0 million lower than the prior year, and the $1.5 million restricted stock portion was also less than last year. | | n | Our CEO’s long-term incentive award granted in October 2024 was, as in prior years, solely performance-based restricted stock units (“PSUs”), with the target award grant value increased from the prior year consistent with a shift in emphasis toward equity incentives, and reflecting peer group and general market data. This award will not fully vest until after our 2027 fiscal year concludes. | | n | Our CEO earned his long-term incentive award at 180% of target (as discussed under “2021 PSU Awards”), reflecting our strong performance on the three applicable measures over the performance period that ran from December 1, 2021 to November 30, 2024. | | n | Taken together, overall CEO total direct compensation was up a modest 3.4% over the prior year. |

  25. Pay For Performance — 2024 Fiscal Year CEO Compensation

    | Total Direct Compensation* | 2024 | 2023 | Change | | Base Salary | $1,150,000 | $1,150,000 | $— | | Annual Incentive Plan Compensation(a) | 7,795,702 | 8,958,644 | (1,162,942) | | Long-Term Incentive Awards(b) | 7,199,979 | 5,500,020 | 1,699,959 | | TOTAL | $16,145,681 | $15,608,664 | $537,017 |

  26. Pay For Performance — 2024 Fiscal Year CEO Compensation

    | * This table does not include certain amounts that are reported in the Summary Compensation Table. It excludes the change in our CEO’s pension value, a required reporting item that represents only the actuarial change in our CEO’s pension benefits based on interest rate fluctuations. It does not reflect any new benefits, cash or other compensation granted to or received by our CEO. This benefit has been frozen with no additional benefit accruals since 2004 (other than the same cost-of-living adjustments applied to federal social security benefits). Additionally, this table excludes amounts in the “All Other Compensation” category, which represents less than one-half of 1% of our CEO’s total annual compensation as reported in the Summary Compensation Table. | | (a) Reflects our CEO’s entire annual incentive for each year, including both the portion paid out in cash and the portion paid out in time-vesting restricted stock in lieu of cash. | | (b) Reflects the target value of our CEO’s long-term incentive award grants for each year, consisting solely of PSUs. |

  27. Pay For Performance — 2024 Fiscal Year CEO Compensation

    | Engaging With Our Stockholders | | | | Direct engagement with our stockholders is an integral part of managing our business to drive long-term value and aligns with our core value of building strong and collaborative relationships. |

  28. Actions Taken Following Stockholder Engagements

    | n | Developed with the Compensation Committee and FWC a structured scorecard methodology to guide annual incentive payout determinations. | | n | Implemented a limit on the cash payouts for annual incentives to our NEOs. | | n | Further reduced the cash payout of the CEO’s annual incentive by allocating a higher portion of his total annual incentive to time-vesting equity in lieu of cash to balance his cash and equity compensation and enhance alignment with stockholder value creation. | | n | The CEO’s non-equity incentive payout has been reduced each year since 2021 despite strong company and individual performance, with more emphasis placed on time- and performance-vesting equity awards that align the CEO’s interests with those of our stockholders. |

  29. Actions Taken Following Stockholder Engagements

    | Compensation Governance | | | | | What We Do | | What We Don’t Do | | | | Engage with and consider stockholder input in designing our executive pay programs. | | No re-pricing or cash-out of underwater stock options without stockholder approval. | | | Link one- and three-year NEO incentive pay to objective, pre-set, financial performance goals. | | We prohibit our employees and non-employee directors from hedging or pledging their holdings of our securities. | | | Solely utilize PSUs for our NEOs’ regular long-term incentive grants, and subject NEOs to robust stock ownership requirements. | | No new executive officer severance arrangements above a certain amount without stockholder approval (see under “Severance Arrangements”). | | | Employee equity awards are subject to double-trigger vesting in a change in control. | | No new excise tax “gross-ups” for any officer or employee. | | | Maintain an incentive-based compensation recovery (a/k/a “clawback”) policy that is consistent with NYSE rules. | | No payments of dividends or dividend equivalents on performance-based equity awards before they vest. | | | Perform, under Compensation Committee oversight, annual risk assessments to determine that our employee compensation policies and programs are not likely to have a material adverse effect on us. | | Avoid excessive perquisites. Perquisites are generally limited to market-competitive medical benefits and the opportunity to participate in a deferred compensation plan. | | | Engage, at the sole direction of the Compensation Committee, an independent compensation consultant. | | | | | Consider our sustainability-related programs’ progress in annual incentive plan performance assessments. | | | | | Maintain a relevant industry peer group. | | |

  30. Pay Program Overview

    As outlined above, we place a significant emphasis on at-risk, performance-based pay. As shown below, in 2024, approximately 93% of our CEO’s total direct compensation consisted of performance-based and/or at-risk vehicles. For our other NEOs, such vehicles, on average, approximated 80% of their total direct compensation. The long-term incentives identified below consist of PSUs and any time-vesting restricted stock paid in conjunction with annual incentives.

  31. NEO Compensation Components

    | Our CEO’s performance-driven annual incentive award payout of $7.80 million was determined pursuant to a largely formula-based plan. Our CEO’s total award decreased approximately $1.16 million, or 13.0%, from the prior year. The cash portion of this award was $6.30 million, approximately $984,000 less than the prior year. The remaining portion of the CEO’s award was paid out in time-vesting restricted stock in lieu of cash. The restricted stock vests ratably over the next three years, which, along with the performance-based long-term incentive awards described below, further aligns our CEO’s compensation with stockholder value creation. |

  32. NEO Compensation Components

    Our annual incentive program is designed to drive performance within a single fiscal year period, with pay outcomes tied to our performance on total adjusted pretax income (“API”). The program is based on two components. First, threshold and target API goals are set based on our internal operational objectives established near the beginning of each year, which take into account expected business conditions for the year. API is our total pretax income excluding certain compensation expense and certain inventory-related charges. Payouts under this first component are capped at 100% of the participants’ respective target level. Second, for the participants to earn any above-target payouts, API must exceed a hurdle based on a pre-set minimum asset efficiency objective. If the hurdle is met, an asset efficiency performance pool is funded for every dollar of API over the hurdle. The funded pool is then allocated based on the participants’ individual performance and contributions as measured under a structured scorecard methodology, which is outlined below, and such allocations are further limited by the individual maximum payout amounts approved under the plan. We view API as a comprehensive short-term measure of our senior officers’ performance, as it reflects their ability to produce profits by generating revenues, managing expenses and controlling fixed costs. In addition, with the homebuilding industry’s significant cyclicality and its volatility in recent years, using API as a primary measure intrinsically scales senior officer pay outcomes (down or up) to a degree relative to the API generated in a one-year period. Combining the API and asset efficiency measures is intended to motivate our senior officers to generate profitable growth aligned with our strategic goals. In 2022, based on stockholder feedback and FWC’s recommendations, the Compensation Committee refined the annual incentive program to further align it with our strategic focus on expanding our scale and to incorporate features to enhance its rigor, including the following, which were maintained in the 2024 program:

  33. NEO Compensation Components

    | n | limiting each participating officer’s cash payouts to no more than 80% of their respective maximum opportunity, with the balance of any earned award above that level paid out in time-vesting restricted stock in lieu of cash. As discussed below, the Compensation Committee limited the CEO’s cash payout under the 2024 program beyond the program’s threshold. | | n | applying a detailed, structured scorecard methodology to determine the annual incentive awards’ asset efficiency component. |

  34. 2024 Annual Incentive Program Component Determinations

    2024 Annual Incentive Program Component Determinations Our NEOs received annual incentive payouts under the 2024 program as described below.

  35. 2024 API PERFORMANCE LEVELS AND PAYOUT SUMMARY

    2024 API PERFORMANCE LEVELS AND PAYOUT SUMMARY

  36. 2024 API PERFORMANCE LEVELS AND PAYOUT SUMMARY

    | | Threshold | Target | Actual Result | | API Performance Levels | $525.0 million | $700.0 million | $937.0 million | | API Performance Levels Relative to Target | 75% | 100% | 134% | | Payout Level Ratios | 50% | 100% | 100% |

  37. Annual Incentive Compensation Scorecard and Individual Performance Factor (or “IPF”)

    Annual Incentive Compensation Scorecard and Individual Performance Factor (or “IPF”) The Compensation Committee determined the asset efficiency performance pool’s allocation to the participating officers (which included the NEOs and several other of our senior officers), guided by a detailed scorecard methodology through which their individual 2024 performance and contributions were assessed across four key dimensions: financial results, execution, strategic planning and leadership. Within the scorecard structure, each participating officer received points in each dimension based on our CEO’s assessment of their performance, and on the Compensation Committee’s assessment, with FWC’s assistance, of our CEO’s performance. The respective cumulative points a participating officer achieved corresponded to an IPF range with upper and lower limits of potential payouts to the officer of the total available asset efficiency performance pool. These pre-established IPF-based payout ranges, outlined below, took into consideration each participating officer’s 2024 annual incentive payout opportunities at threshold, target and maximum levels; historical relative annual incentive payouts by functional role; additional individual accomplishments and competitive market pay information.

  38. Annual Incentive Compensation Scorecard and Individual Performance Factor (or “IPF”)

    | 30 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  39. 2024 Annual Incentive Compensation Scorecard

    2024 Annual Incentive Compensation Scorecard

  40. 2024 Annual Incentive Compensation Scorecard

    | Dimension | Financial Results (0-8 pts.) | Execution (0-4 pts.) | | Goals and Objectives | Meet or exceed FY24 goals for: ■ Homebuilding revenues ■ Homebuilding operating income as a percentage of total revenues ■ Selling, general and administrative expenses as a percentage of homebuilding revenues ■ Cash flow ■ Return on equity ■ Diluted earnings per share | ■ Optimize performance of each community by balancing pricing, sales pace and return on investment ■ Generate year-over-year community count growth, targeting 250+ communities open at November 30, 2024 ■ Achieve a minimum 90% customer satisfaction rating in the majority of served markets, per an outside firm ■ Enhance supply chain to ensure ability to support the business with qualified partners that have committed to our Supplier Code of Conduct ■ Analyze workplace practices, including as to pay, to ensure equitable outcomes | | | Strategic Planning (0-4 pts.) | Leadership (0-4 pts.) | | | ■ Build forecasts and business plans to reflect current and expected future market conditions ■ Establish future community count pipeline through 2026 in response to current market conditions and community needs ■ Develop long-term objectives supported by concrete action plans for sustainability-related goals, such as average RESNET Home Energy Rating System (HERS®) Index score and workforce inclusion, wellness and safety | ■ Attract, retain and develop critical talent, especially in land disciplines, to drive growth and future results ■ Enhance culture of customer obsession, driving best in class results in homebuyer satisfaction ■ Strive to achieve top homebuilder rankings and external recognition for our sustainability-related accomplishments |

  41. Maximum Potential IPF Per Cumulative Scorecard Points

    The Total Payout in the table below represents a cash payment to each officer other than Messrs. Mezger and Woram. Under the 2024 program terms, cash payouts were limited to 80% of a participating officer’s respective maximum payout opportunity, with any earned award balance above the cash maximum paid in time-vesting restricted stock in lieu of cash. As an annual incentive payout, this stock grant is not part of our separate long-term incentive program described below. Mr. Mezger’s total payout included $6,295,702 in cash, which was nearly $2,000,000 million less than his cash maximum under the 2024 program terms, as the Compensation Committee allocated $1,500,000 of his total payout into time-vesting restricted stock in lieu of cash to balance his overall cash and equity compensation, and to increase its alignment with stockholder value creation. Per the 2024 program, Mr. Woram’s total payout included $1,601,600 in cash and $69,902 in time-vesting restricted stock in lieu of cash.

  42. 2024 ANNUAL INCENTIVE PROGRAM COMPONENT AND TOTAL PAYOUT LEVELS(a)

    2024 ANNUAL INCENTIVE PROGRAM COMPONENT AND TOTAL PAYOUT LEVELS(a)

  43. 2024 ANNUAL INCENTIVE PROGRAM COMPONENT AND TOTAL PAYOUT LEVELS(a)

    | NEO | API Performance Component Payout | Asset Efficiency Component Payout | Total Payout(b) | | Mr. Mezger | $2,587,500 | $5,208,202 | $7,795,702 | | Mr. Kaminski | 1,197,000 | 1,052,419 | 2,249,419 | | Mr. McGibney | 1,575,000 | 2,193,968 | 3,768,968 | | Mr. Praw | 1,001,000 | 802,306 | 1,803,306 | | Mr. Woram | 1,001,000 | 670,502 | 1,671,502 |

  44. 2024 ANNUAL INCENTIVE PROGRAM COMPONENT AND TOTAL PAYOUT LEVELS(a)

    | (a) Annex 2 to this Proxy Statement contains a reconciliation of our pretax income calculated in accordance with U.S. generally accepted accounting principles (“GAAP”) to the non-GAAP financial measure of API. | | (b) As discussed above, and as reflected in the Summary Compensation Table, Messrs. Mezger’s and Woram’s respective total payouts are comprised of cash and time-vesting restricted stock. The total payouts for Messrs. Kaminski, McGibney and Praw comprised only cash. |

  45. 2025 Annual Incentive Program

    2025 Annual Incentive Program The 2025 annual incentive program will be similar to our 2024 program, including a primarily formula-driven funding structure established by API and asset efficiency performance measures with payout levels determined by our outcomes on these measures and individual performance against key scorecard objectives. The pre-established 2025 annual incentive program’s API target performance goal will reflect, among other things, the Compensation Committee’s consideration of expected business conditions for the current year. Long-Term Incentives In October 2024, the Compensation Committee approved long-term incentive awards to our NEOs consisting solely of PSUs to reinforce the alignment of pay with our performance and stockholder value creation. The target value of Mr. Mezger’s award was increased consistent with our shift in emphasis toward equity in the ratio of cash and equity compensation components and to enhance stockholder value creation. Mr. Kaminiski was not granted an award due to his previously announced retirement as Executive Vice President and Chief Financial Officer effective early 2025. The following target awards were made to our NEOs with the intention to maintain competitive pay arrangements, grounded in peer group and market data analysis; reward strong long-term performance; and aid in retaining key talent:

  46. NEO LONG-TERM INCENTIVES GRANTED IN 2024

    NEO LONG-TERM INCENTIVES GRANTED IN 2024

  47. NEO LONG-TERM INCENTIVES GRANTED IN 2024

    | | PSUs # | PSUs $ | | Mr. Mezger | 90,214 | $7,199,979 | | Mr. McGibney | 37,589 | 2,999,978 | | Mr. Praw | 11,903 | 949,978 | | Mr. Woram | 11,903 | 949,978 |

  48. NEO LONG-TERM INCENTIVES GRANTED IN 2024

    | 34 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  49. Performance-Based Restricted Stock Units

    Performance-Based Restricted Stock Units We have granted PSUs to our executive officers each year since 2012. As with prior PSU grants, the PSUs granted in 2024 are designed to focus our executive officers on achieving important long-term financial objectives over a three-year period. The 2024 PSU measures described below are a combination of absolute and relative metrics that should generate positive outcomes for our business, and, if achieved, are expected to be strong drivers of stockholder value creation.

  50. Performance-Based Restricted Stock Units

    | PSU Measures | | Weight | Purpose | | ■ | Cumulative Adjusted Earnings Per Share (“AEPS”) | 40% | Measures profitability trajectory over the period | | ■ | Average Adjusted Return on Invested Capital (“AROIC”) | 35% | Measures profitability relative to capital deployed | | ■ | Revenue Growth Rank Versus Peers | 25% | Measures top-line growth relative to peers |

  51. Performance-Based Restricted Stock Units

    The 2024 PSU amounts shown in the table above reflect a target award of shares of our common stock and their grant date fair value. Each 2024 PSU entitles a recipient to a grant of 0% to 200% of his target award depending on our performance relative to the above-noted performance measures over the three-year period of December 1, 2024 to November 30, 2027. The AEPS and AROIC measures’ performance will be determined on a tax-effected basis that excludes only pre-specified categories of compensation expense; certain inventory-related charges; and other extraordinary items approved by the Compensation Committee. Upon vesting, each 2024 PSU recipient is entitled to receive a proportionate amount of credited cash dividends that are paid in respect of one share of our common stock with a record date between the grant date and the date the Compensation Committee determines the applicable performance achievements, if any. Except for death, disability or certain retirement circumstances, a recipient will forfeit any rights to a 2024 PSU payout if the recipient terminates service before the date the Compensation Committee determines the applicable performance achievements. The following tables present our goals with respect to the 2021 – 2024 absolute PSU performance measures. As shown below, the goals for both the AEPS and AROIC measures generally increased year over year at threshold, target and maximum performance levels, reflecting the consistent improvement in our performance in the prior-year periods and stockholder feedback. As it relates to fiscal 2022, when the Compensation Committee established the PSU measures and goals in the fourth quarter of that year, homebuyer demand had turned sharply lower, stemming from higher mortgage interest rates, persistent inflationary pressures and an uncertain economic outlook. Given this environment, the Compensation Committee established 2022 PSU goals for both AEPS and AROIC that were lower than the goals for the same measures under the 2021 PSUs. Considering then-current market conditions, the Compensation Committee established AEPS goals for the 2023 and 2024 PSUs and AROIC goals for the 2023 PSUs at levels higher than those for all prior years. For the 2024 PSUs, the AROIC goals were increased modestly at threshold and target compared to the prior year. In all cases, the goals have reflected our expectations regarding future performance against the measures at the times that the goals were set.

  52. Performance-Based Restricted Stock Units

    | Performance Measure | PSU Grant Year | Performance Period | Threshold Goal | Target Goal | Maximum Goal | | AEPS | 2021 | 2022-2024 | $7.22 | $10.32 | $13.42 | | | 2022 | 2023-2025 | $5.43 | $7.75 | $10.08 | | | 2023 | 2024-2026 | $7.35 | $10.50 | $13.65 | | | 2024 | 2025-2027 | $12.40 | $15.50 | $18.60 | | AROIC | 2021 | 2022-2024 | 6.2% | 8.9% | 11.6% | | | 2022 | 2023-2025 | 4.3% | 6.1% | 7.9% | | | 2023 | 2024-2026 | 6.3% | 9.0% | 11.7% | | | 2024 | 2025-2027 | 7.5% | 9.4% | 11.3% |

  53. Performance-Based Restricted Stock Units

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 35 |

  54. Performance-Based Restricted Stock Units

    We utilize a percentile rank approach to determine the target award multiplier for the relative revenue growth measure as outlined in the table below. The applicable peer group is established at the respective grant date and adjustments are made if a peer group member ceases to be a peer during the relevant performance period. Payouts for performance between the levels shown below are determined by straight-line interpolation.

  55. Performance-Based Restricted Stock Units

    | Relative Revenue Growth | Performance (Rank) | Target Award Multiplier | | | 75th Percentile or above | 200% | | | 50th Percentile (Median) | 100% | | | 25th Percentile | 25% | | | Below 25th Percentile | 0% | | As with our annual incentive program, the Compensation Committee intends the threshold performance levels outlined above to be reasonably achievable, yet uncertain to be met under expected market and business conditions at the time of grant. Target performance levels are designed to require significant management effort to achieve, and maximum performance levels are designed to be measurably more difficult to achieve than target performance levels. Each of these performance levels directly scale to threshold, target and maximum payout opportunities. As vesting for the PSUs granted in 2022 – 2024 will not be determined until after their respective performance periods end, we cannot predict the extent to which any shares under these awards will ultimately vest. 2021 PSU Awards The PSUs granted to our executive officers in 2021 entitled recipients to a grant of 0% to 200% of a target award of shares of our common stock based on our AEPS performance, AROIC performance, and relative revenue growth performance (with the respective rankings and multipliers as shown in the above table) over the three-year period from December 1, 2021 to November 30, 2024. The applicable AEPS and AROIC performance measures and goals are set forth below. | | | | 2021 PSU Performance Measure | 2021 PSU Performance Goals | 2021 PSU Target Award Multiplier | | AEPS | $13.42 and above | 200% | | | $10.32 | 100% | | | $7.22 | 25% | | | Below $7.22 | 0% | | AROIC | 11.6% and above | 200% | | | 8.9% | 100% | | | 6.2% | 25% | | | Below 6.2% | 0% |

  56. 2021 PSU AWARD DETERMINATIONS

    2021 PSU AWARD DETERMINATIONS

  57. 2021 PSU AWARD DETERMINATIONS

    | Performance Measure | Average Annual Performance | Aggregate Total Performance | Target Award Multiplier | | AEPS (40% weight) | N/A | $24.99* | 200% | | AROIC (35% weight) | 13.0%* | N/A | 200% | | Relative Revenue Growth (25% weight) | N/A | 55th percentile (6th) | 118% |

  58. 2021 PSU AWARD DETERMINATIONS

    | * Annex 2 to this Proxy Statement contains a reconciliation of our net income and diluted earnings per share calculated in accordance with GAAP to the non-GAAP financial measures of adjusted net income and adjusted earnings per share used in computing AEPS and AROIC. |

  59. 2021 PSU AWARD DETERMINATIONS

    | 36 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  60. 2021 PSU AWARD DETERMINATIONS

    The AEPS performance result for the 2021 PSUs exceeded the challenging $13.42 maximum goal level set at the time of grant and reflected our emphasis on growing our diluted earnings per share by 41% amid volatile housing market conditions during the entire performance period. The increase in our diluted earnings per share also reflected the favorable impact of our share repurchases. Historically strong profitability and cumulative adjusted net income of approximately $2.09 billion contributed to a significant increase in our adjusted return on invested capital, exceeding our maximum goal for this measure. The relative revenue ranking for the 2021 PSUs reflected our solid revenue growth performance over the applicable period, placing us 6th in the peer group for rate of revenue growth. Based on the relative revenue scale outlined in the above table, our performance placed us at approximately the 55th percentile of our peer group, resulting in a payment of 118% for this measure. All of these outcomes were uncertain at the time the 2021 PSUs were granted, and the Compensation Committee determined that they required significant management effort to achieve and sustain through the entirety of the performance period. On February 21, 2025, the Compensation Committee certified the performance we achieved for the three-year period ended November 30, 2024 and approved share payouts with respect to the 2021 PSUs at 180% of target as set forth in the table below.

  61. 2021 PSU AWARDS

    2021 PSU AWARDS

  62. 2021 PSU AWARDS

    | NEO | Target Award(#) | Actual Award(#) | | Mr. Mezger | 127,194 | 228,949 | | Mr. Kaminski | 35,614 | 64,105 | | Mr. McGibney | 50,878 | 91,580 | | Mr. Praw | 22,895 | 41,211 | | Mr. Woram | 21,623 | 38,921 |

  63. Executive Compensation Decision-Making Process and Policies

    Executive Compensation Decision-Making Process and Policies Pursuant to its charter, the Compensation Committee oversees the decision-making process for our executive compensation and benefits policies and programs. In making executive compensation decisions, the Compensation Committee considers a variety of factors and data, most importantly our performance and individual executives’ performance, and the totality of compensation that may be paid. Among the data the Compensation Committee considers is our financial and operational performance, including comparisons to prior years’ performance, our current business plans and our peer group; surveys and forecasts of comparative general industry and peer group compensation and benefits practices; and, at least annually, management-prepared tally sheets for senior executives with up to six years of compensation data. Role of Our Management and Compensation Consultants Our CEO, senior human resources and legal department executives, and FWC provide information and recommendations to assist the Compensation Committee’s decision-making and advise on compliance and disclosure requirements. The Compensation Committee does not delegate its decision-making authority to management, except for establishing certain performance goals under our performance cash program for participating division-level personnel and certain administrative actions under our current equity compensation plan, but only to the extent consistent with our equity-based award grant policy and applicable law. FWC, which the Compensation Committee directly retains, attends Compensation Committee meetings as needed, communicates between meetings with the Compensation Committee chair and other committee members, advises the Compensation Committee as to the CEO’s and other executive officers’ compensation, and assists the Compensation Committee with the annual employee compensation risk assessment, as discussed under “Management Development and Compensation Committee—Delegated Risk Oversight.” To maintain its independence and avoid any conflicts of interest, FWC may not work directly for our management unless the Compensation Committee pre-approves the work, including fees. During 2024, FWC did not provide any services that would have required such pre-approval. Based on its consideration of factors under New York Stock Exchange (“NYSE”) listing standards, the Compensation Committee determined that FWC’s work did not raise any conflicts of interest, and therefore considered FWC to be independent.

  64. Executive Compensation Decision-Making Process and Policies

    Peer Group Our peer group is composed solely of U.S. public companies that, like us, are engaged in high production homebuilding as their primary business. We compete with all these companies for both homebuyers and management talent. The competition with these companies for talent reflects our, and their, need to attract and retain high caliber management and other personnel with strong high production homebuilding expertise and experience to execute business activities nationally as well as in specific local markets. Therefore, a principal focus of our compensation and benefits programs is to meet this critical competitive need. The Compensation Committee, in consultation with FWC and our management, periodically reviews and considers changes to our peer group at least annually. The Compensation Committee principally considers the competitive factors described above, as well as relative total revenues and market capitalization among the peer group companies. The group’s members were adjusted in October 2024 to remove peer M.D.C. Holdings, Inc., which was acquired by a Japanese company during the year, and to add two new peers – Century Communities, Inc. and M/I Homes, Inc. M.D.C. Holdings, Inc. was part of the peer group for determining the 2021 PSU share payouts, while Century Communities, Inc. and M/I Homes, Inc. were not included. As of their most recently filed proxy statements before the date of this Proxy Statement, each member of our peer group listed below included us in its own peer group.

  65. OUR PEER GROUP

    OUR PEER GROUP

  66. OUR PEER GROUP

    | ■ | Beazer Homes USA, Inc. | ■ | Century Communities, Inc. | ■ | D.R. Horton, Inc. | | ■ | Hovnanian Enterprises, Inc. | ■ | Lennar Corporation | ■ | Meritage Homes Corporation | | ■ | NVR, Inc. | ■ | M/I Homes, Inc. | ■ | Pulte Group, Inc. | | ■ | Taylor Morrison Home Corporation | ■ | Toll Brothers, Inc. | ■ | Tri Pointe Homes. Inc. |

  67. OUR PEER GROUP

    As of December 31, 2024, the reported total revenues (on a trailing 12-month basis) of the companies in our above-listed peer group were within a range of approximately 0.3 to 5.3 times our total revenues, and our total revenues of $6.93 billion placed us at the 50th percentile of the peer group. Also, as of December 31, 2024, the peer group’s market capitalization was within a range of approximately 0.1 to 9.3 times our market capitalization of $4.82 billion, which was at the 43rd percentile of the peer group. Equity Stock Ownership Policy Our longstanding executive stock ownership policy is intended to encourage, and has encouraged, our executives to increase their ownership of our common stock over time and to align their interests with our stockholders’ interests. Under the policy, designated senior executives are expected to achieve specific levels of common stock ownership within five years of joining us or being promoted to a position with a higher ownership guideline and, once achieved, maintain such ownership throughout their employment with us. The targeted common stock ownership levels for our NEOs are as follows:

  68. OUR PEER GROUP

    | Executive | Ownership Guideline | | CEO | 6.0 times base salary | | COO | 3.0 times base salary | | Other NEOs | 2.0 times base salary |

  69. OUR PEER GROUP

    Common stock ownership includes shares directly owned by the NEO, and shares are valued at the greater of the most recent closing price on a valuation date and the closing price on the date shares are acquired. Shares subject to unearned PSUs or unexercised stock options do not count toward common stock ownership. Designated executives are required to hold all vested net (after-tax) shares of time-vesting and performance-vesting restricted stock and up to 100% of net shares acquired through stock option exercises until their applicable stock ownership guideline is met, absent a hardship or other qualified exception. Each NEO is in compliance with the requirements of the policy. Prohibition on Hedging/Pledging of Our Securities To further align their interests with those of our stockholders, our employees and non-employee directors cannot engage in short sales of our securities and cannot buy or sell puts, calls or purchase any other financial instruments that are designed to hedge or offset decreases in the value of our securities. They also cannot hold our securities in a margin account or otherwise pledge our securities as collateral for any loan.

  70. OUR PEER GROUP

    | 38 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  71. OUR PEER GROUP

    Equity-Based Award Grant Policy and Grant Practices Our equity-based award grant policy governs the timing and establishes certain internal controls over the grant of equity-based awards, including stock options (which we have not granted since 2016), restricted stock and PSUs. The policy establishes, among other things, that the Compensation Committee (or the Board) must approve all grants of equity-based awards and their terms, and the delegation of this authority to our management is not permitted. The policy also specifies that the exercise or grant price of any relevant equity-based award cannot be less than the closing price of our common stock on the grant date; annual long-term incentive equity-based awards to existing employees are to be granted only at a regularly scheduled meeting of the Compensation Committee or Board (either, a “granting body”), typically held in October; new hire or promotion awards are to be granted at a regularly scheduled meeting of the granting body that is on (or that is the earliest following) the date of an applicable circumstance; and the granting body generally avoid approving equity-based awards and setting grant dates during the trading blackout periods established under our Trading Policy to align with that policy’s prohibition on our and covered persons’ trading in our securities when aware of material, non-public information about the company. While the quarterly trading blackouts under the Trading Policy begin 15 days before each fiscal quarter-end and end after we have filed with the SEC the applicable periodic report for that fiscal quarter, absent an event-specific trading blackout being in effect, the granting body may approve equity-based awards and set grant dates in the period beginning after we have publicly released the quarter’s earnings and ending when the next trading blackout starts under the Trading Policy. We do not time the disclosure of material nonpublic information for the purpose of affecting the value of equity-based awards granted to our employees. Compensation Recovery Policy The Board adopted an updated incentive-based compensation recovery policy in 2023 per the applicable NYSE listing standard. Under the policy, if we are required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the securities laws, we will be entitled to recover in accordance with the listing standard the amount of erroneously awarded incentive-based compensation an executive officer received. In addition, under our CEO’s employment agreement, we may require him to repay certain bonus and incentive- or equity-based compensation he receives as well as any profits realized from the sale of certain securities if we are required to restate our financial statements as a result of his misconduct, consistent with Section 304 of the Sarbanes-Oxley Act of 2002. Executive Compensation Program Tax Implications Due to changes to the Internal Revenue Code (“Code”) enacted in 2017, specifically repealing an exemption for performance-based compensation, we are generally not able to deduct compensation over $1.0 million paid to certain of our executive officers. The Compensation Committee will approve compensation that may not be deductible under the Code where it believes it is in our and our stockholders’ best interests to do so. Indemnification Agreements We have entered into agreements with each NEO and certain other senior executives, which were updated in January 2024, that provide them with indemnification and advancement of expenses to supplement what our Certificate of Incorporation and insurance policies provide, subject to certain limitations. Severance, Change in Control, Post-Termination Arrangements and Other Benefits

  72. Severance Arrangements

    Severance Arrangements Mr. Mezger’s Employment Agreement and our Executive Severance Plan, in which all our NEOs participate, provide certain severance benefits, as discussed under “Potential Payments Upon Termination of Employment or Change in Control.” In considering our stockholders’ approval of an advisory proposal, in 2008 we adopted a policy under which we will obtain stockholder approval before paying severance benefits to an executive officer under a future severance arrangement in excess of 2.99 times the sum of the executive officer’s then-current base salary and target bonus. Future severance arrangements do not include arrangements existing when we adopted the policy or that we assume or acquire unless, in each case, any such arrangement is changed in a manner that materially increases its severance benefits.

  73. Severance Arrangements

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 39 |

  74. Severance Arrangements

    | Compensation Discussion and Analysis Management Development and Compensation Committee Report |

  75. Change in Control Arrangements

    Change in Control Arrangements Since 2001, we have maintained without modification the terms of a Change in Control Severance Plan (“CIC Plan”) that provides participants with certain benefits, as discussed under “Potential Payments Upon Termination of Employment or Change in Control.” The CIC Plan is intended to enable and encourage our management to focus its attention on obtaining the best possible result for our stockholders in a change in control, to promote management continuity, and to provide income protection if there is an involuntary loss of employment. All unvested employee equity awards require double-trigger vesting in a change in control.

  76. Summary Compensation Table

    Summary Compensation Table

  77. Summary Compensation Table

    | Fiscal Year | Salary ($)(a) | Bonus ($) | Stock Awards ($)(b) | Non-Equity Incentive Plan Compensation ($)(c) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(d) | All Other Compensation ($)(e) | Total ($) | | Jeffrey T. Mezger, Chairman and Chief Executive Officer | | | | | | | | | 2024 | $1,150,000 | $— | $8,699,979 | $6,295,702 | $482,359 | $81,291 | $16,709,331 | | 2023 | 1,150,000 | — | 7,178,664 | 7,280,000 | — | 80,391 | 15,689,055 | | 2022 | 1,150,000 | — | 7,105,882 | 7,480,000 | — | 78,909 | 15,814,791 | | Jeff J. Kaminski, Executive Vice President and Chief Financial Officer | | | | | | | | | 2024 | 840,417 | — | — | 2,249,419 | — | 63,516 | 3,153,352 | | 2023 | 812,500 | — | 1,500,017 | 2,122,653 | — | 61,841 | 4,497,011 | | 2022 | 785,417 | — | 1,400,008 | 2,272,201 | — | 60,234 | 4,517,860 | | Robert V. McGibney, President and Chief Operating Officer | | | | | | | | | 2024 | 891,667 | — | 2,999,978 | 3,768,968 | — | 66,531 | 7,727,144 | | 2023 | 820,833 | — | 2,249,982 | 3,723,971 | — | 62,281 | 6,857,067 | | 2022 | 770,833 | — | 1,999,998 | 3,656,299 | — | 59,308 | 6,486,438 | | Albert Z. Praw, Executive Vice President, Real Estate and Business Development | | | | | | | | | 2024 | 700,417 | — | 949,978 | 1,803,306 | — | 54,648 | 3,508,349 | | 2023 | 675,417 | — | 950,002 | 1,701,060 | — | 53,148 | 3,379,627 | | 2022 | 650,417 | — | 899,986 | 1,821,451 | — | 51,666 | 3,423,520 | | Brian J. Woram, Executive Vice President and General Counsel | | | | | | | | | 2024 | 700,417 | — | 1,019,880 | 1,601,600 | — | 48,008 | 3,369,905 | | 2023 | 675,417 | — | 931,376 | 1,545,600 | — | 47,866 | 3,200,259 | | 2022 | 650,417 | — | 1,045,327 | 1,489,600 | — | 52,134 | 3,237,478 |

  78. Summary Compensation Table

    | (a) Salary. As discussed under “Base Salaries,” except for Messrs. Mezger and McGibney, NEO annual base salary levels were increased in July 2024 to the following amounts: Mr. Kaminski $855,000; Mr. Praw $715,000; and Mr. Woram $715,000. Mr. McGibney’s annual base salary was increased to $900,000 in February 2024 in conjunction with his promotion to President and Chief Operating Officer. | | (b) Stock Awards. These amounts include the aggregate grant date fair value of stock awards (consisting of PSUs granted in October 2024) computed as described in Note 21 — Employee Benefit and Stock Plans in the Notes to the Consolidated Financial Statements in our Annual Report. They do not represent realized compensation. The October 2024 stock awards represent the grant date fair value of the probable (i.e., target) award of shares of our common stock underlying the PSUs granted. The grant date fair value of the PSUs if maximum performance is achieved is as follows: Mr. Mezger $14,399,959; Mr. McGibney $5,999,956; Mr. Praw $1,899,957; and Mr. Woram $1,899,957. Mr. Kaminski was not granted an award in October 2024 due to his previously announced retirement as Executive Vice President and Chief Financial Officer effective early 2025. The amounts for Messrs. Mezger and Woram also include the $1,500,000 and $69,902 value of the respective restricted stock grant each received on January 23, 2025, as discussed under “2024 Annual Incentives” and as shown in the Grants of Plan-Based Awards During Fiscal Year 2024 table. | | (c) Non-Equity Incentive Plan Compensation. For Mr. McGibney, the amount reflects the sum of his annual incentive and a three-year performance cash award of $531,358 in 2023 and $402,758 in 2022, each originally granted to him prior to his becoming an executive officer in 2021. For all other NEOs, the amounts reflect only the cash portion of their annual incentive payouts. | | (d) Change in Pension Value and Nonqualified Deferred Compensation Earnings. These amounts (as applicable) reflect the increase in the actuarial present value of accumulated benefits under our Retirement Plan. These changes do not reflect any cash or other compensation received. |

  79. Summary Compensation Table

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 41 |

  80. Summary Compensation Table

    | Executive Compensation Grants of Plan-Based Awards During Fiscal Year 2024 |

  81. Summary Compensation Table

    | (e) All Other Compensation. The amounts shown consist of the following items: |

  82. Summary Compensation Table

    | ■ | 401(k) Plan and DCP Matching Contributions. The respective aggregate 2024, 2023 and 2022 401(k) Plan and DCP matching contributions we made to our NEOs were as follows: Mr. Mezger $66,700, $65,800 and $64,300; Mr. Kaminski $50,425, $48,750 and $47,125; Mr. McGibney $53,500, $49,250 and $46,250; Mr. Praw $42,025, $40,525 and $39,025; and Mr. Woram $34,917, $34,775 and $39,025. | | ■ | Premium Payments. The respective aggregate premiums we paid for our NEOs in 2024, 2023 and 2022 for a supplemental medical expense reimbursement plan and life insurance policies, as described under “Other Benefits,” were as follows: Mr. Mezger $14,591, $14,591 and $14,609; Mr. Kaminski $13,091, $13,091 and $13,109; Mr. McGibney $13,031, $13,031 and $13,058; Mr. Praw $12,623, $12,623 and $12,641; and Mr. Woram $13,091, $13,091 and $13,109. |

  83. Grants of Plan-Based Awards During Fiscal Year 2024

    Grants of Plan-Based Awards During Fiscal Year 2024

  84. Grants of Plan-Based Awards During Fiscal Year 2024

    | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(b) | | | | Estimated Future Payouts Under Equity Incentive Plan Awards(c) | | | Grant Date Fair Value of Stock and Option Awards ($)(d) | | Name | Grant Date(a) | Type of Award | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | Mr. Mezger | 2/28/2024 | Annual Incentive | $1,293,750 | $2,587,500 | $8,280,000 | | | | | | | 10/10/2024 | PSUs | | | | 22,554 | 90,214 | 180,428 | $7,199,979 | | | 1/23/2025 | Restricted Stock | | | | | 22,150 | | 1,500,000 | | Mr. Kaminski | 2/28/2024 | Annual Incentive | 598,500 | 1,197,000 | 2,872,800 | | | | | | Mr. McGibney | 2/28/2024 | Annual Incentive | 787,500 | 1,575,000 | 3,780,000 | | | | | | | 10/10/2024 | PSUs | | | | 9,397 | 37,589 | 75,718 | 2.999,978 | | Mr. Praw | 2/28/2024 | Annual Incentive | 500,500 | 1,001,000 | 2,402,400 | | | | | | | 10/10/2024 | PSUs | | | | 2,976 | 11,903 | 23,806 | 949,978 | | Mr. Woram | 2/28/2024 | Annual Incentive | 500,500 | 1,001,000 | 1,601,600 | | | | | | | 10/10/2024 | PSUs | | | | 2,976 | 11,903 | 23,806 | 949,978 | | | 1/23/2025 | Restricted Stock | | | | | 1,032 | | 69,902 |

  85. Grants of Plan-Based Awards During Fiscal Year 2024

    | (a) Grant Date. The date the Compensation Committee approved each award. The January 23, 2025 restricted stock grants represent each applicable recipient’s portion of their ultimate 2024 fiscal year annual incentive award, as discussed under “2024 Annual Incentives.” These awards vest in three equal annual installments beginning January 25, 2026. | | (b) Estimated Future Payouts Under Non-Equity Incentive Plan Awards. The 2024 target payouts were set at 225% of base salary for our CEO and at 140% — 175% of base salary for each of our other NEOs with the maximum incentive set at a multiple of four times target for our CEO, three times target for Messrs. Kaminski, McGibney, and Praw, and two times target for Mr. Woram. Notwithstanding these potential maximum incentive calculations, “Maximum” in the above table represents each officer’s maximum cash payout, which, as described under “2024 Annual Incentives,” was limited to no more than 80% of a participant’s respective maximum opportunity. “Threshold” represents the lowest possible payout if threshold performance is achieved for each performance measure. The performance measures are described under “2024 Annual Incentives.” Mr. Kaminiski was not granted a PSU award in October 2024 due to his previously announced retirement as Executive Vice President and Chief Financial Officer effective early 2025. | | (c) Estimated Future Payouts Under Equity Incentive Plan Awards. If there is a payout of the PSUs, “Threshold” represents the lowest possible payout (25% of the target award of shares granted) if threshold performance is achieved for each performance measure, and “Maximum” reflects the highest possible payout (200% of the target award of shares granted). The performance measures are described under “Performance-Based Restricted Stock Units.” If threshold performance is not achieved on all three measures, the NEOs will not receive any payout of the PSUs. | | (d) Grant Date Fair Value of Stock and Option Awards. The grant date fair value for each award is computed as described in footnote (b) to the Summary Compensation Table. The 2024 PSUs represent the grant date fair value of the probable award of shares of our common stock underlying the PSUs granted as of the grant date. The restricted stock amounts for Messrs. Mezger and Woram are the value of the respective grant each received on January 23, 2025, as discussed under “2024 Annual Incentives.” |

  86. Grants of Plan-Based Awards During Fiscal Year 2024

    | 42 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  87. Grants of Plan-Based Awards During Fiscal Year 2024

    | Executive Compensation Outstanding Equity Awards at Fiscal Year-End 2024 |

  88. Outstanding Equity Awards at Fiscal Year-End 2024

    Outstanding Equity Awards at Fiscal Year-End 2024

  89. Outstanding Equity Awards at Fiscal Year-End 2024

    | | | Option Awards | | Stock Awards | | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#)(a) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(b) | Market Value of Shares or Units of Stock That Have Not Vested ($)(c) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(d) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(d) | | Mr. Mezger | 10/6/2016 | 274,952 | $16.21 | 10/6/2026 | | | | | | | 10/7/2021 | | | | 228,949 | $18,943,240 | | | | | 11/14/2022 | | | | | | 166,003 | $13,735,088 | | | 1/19/2023 | | | | 40,342 | 3,337,897 | | | | | 10/5/2023 | | | | | | 124,717 | 10,319,085 | | | 1/18/2024 | | | | 27,465 | 2,272,454 | | | | | 10/10/2024 | | | | | | 90,214 | 7,464,306 | | Mr. Kaminski | 10/6/2016 | 54,986 | 16.21 | 10/6/2026 | | | | | | | 10/7/2021 | | | | 64,105 | 5,304,048 | | | | | 11/14/2022 | | | | | | 46,481 | 3,845,838 | | | 10/05/2023 | | | | | | 34,014 | 2,814,318 | | Mr. McGibney | 10/8/2015 | 14,000 | 14.92 | 10/8/2025 | | | | | | | 10/6/2016 | 20,621 | 16.21 | 10/6/2026 | | | | | | | 10/7/2021 | | | | 91,580 | 7,577,329 | | | | | 11/14/2022 | | | | | | 66,401 | 5,494,019 | | | 10/5/2023 | | | | | | 51,020 | 4,221,395 | | | 10/10/2024 | | | | | | 37,589 | 3,110,114 | | Mr. Praw | 10/7/2021 | | | | 41,211 | 3,409,798 | | | | | 11/14/2022 | | | | | | 29,880 | 2,472,271 | | | 10/5/2023 | | | | | | 21,542 | 1,782,385 | | | 10/10/2024 | | | | | | 11,903 | 984,854 | | Mr. Woram | 10/7/2021 | | | | 38,921 | 3,220,324 | | | | | 11/14/2022 | | | | | | 28,220 | 2,334,923 | | | 1/19/2023 | | | | 3,742 | 309,613 | | | | | 10/5/2023 | | | | | | 20,408 | 1,688,558 | | | 1/18/2024 | | | | 513 | 42,446 | | | | | 10/10/2024 | | | | | | 11,903 | 984,854 |

  90. Outstanding Equity Awards at Fiscal Year-End 2024

    | (a) Number of Securities Underlying Unexercised Options Exercisable. Subsequent to our 2024 fiscal year end, Mr. Kaminski exercised 27,500 stock options granted to him on October 6, 2016. | | (b) Number of Shares or Units of Stock That Have Not Vested. The October 7, 2021 shares represent the shares of our common stock the Compensation Committee approved for grant on February 21, 2025 pursuant to the 2021 PSUs based on our performance through the performance period, as described under “2021 PSU Awards.” Upon this approval, the earned 2021 PSU-related shares became fully vested and unrestricted. The January 2023 and 2024 shares for Messrs. Mezger and Woram represent the portions of their earned 2022 and 2023 fiscal year annual incentives not paid in cash. These shares vest in three equal annual installments beginning the first anniversary of each award date. The table does not include the 22,150 and 1,032 restricted stock awards granted on January 23, 2025 to Messrs. Mezger and Woram, respectively, representing the portion of their earned 2024 fiscal year annual incentive not paid in cash, as discussed under “2024 Annual Incentives.” These amounts appear in the Grants of Plan Based Awards During Fiscal Year 2024 table. These shares vest in three equal annual installments beginning on January 25, 2026. | | (c) Market Value of Shares or Units of Stock That Have Not Vested. The market value shown is based on the closing price of our common stock on November 30, 2024, which was $82.74. | | (d) Equity Incentive Plan Awards: Number and Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested. The awards shown are the PSUs granted to our NEOs in 2022, 2023 and 2024, reflecting target award amounts as of November 30, 2024, and the closing price of our common stock on November 30, 2024, which was $82.74. These PSUs will vest based on our achievement of certain performance measures, as described under “Performance-Based Restricted Stock Units,” over an applicable three-year performance period. |

  91. Outstanding Equity Awards at Fiscal Year-End 2024

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 43 |

  92. Outstanding Equity Awards at Fiscal Year-End 2024

    | Executive Compensation Option Exercises and Stock Vested During Fiscal Year 2024 |

  93. Option Exercises and Stock Vested During Fiscal Year 2024

    Option Exercises and Stock Vested During Fiscal Year 2024

  94. Option Exercises and Stock Vested During Fiscal Year 2024

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#)(a) | Value Realized on Vesting ($)(b) | | Mr. Mezger | 333,000 | $14,877,632 | 249,121 | $15,262,565 | | Mr. Kaminski | 142,500 | 6,912,898 | 64,105 | 3,927,072 | | Mr. McGibney | 14,781 | 683,487 | 91,580 | 5,610,191 | | Mr. Praw | — | — | 41,211 | 2,524,586 | | Mr. Woram | 93,272 | 4,175,473 | 40,792 | 2,499,048 |

  95. Option Exercises and Stock Vested During Fiscal Year 2024

    | (a) The shares reported are the total each NEO acquired from the vesting of their 2021 PSU awards, as discussed under “Long-Term Incentives.” In addition, Messrs. Mezger and Woram acquired 20,172 and 1,871 shares respectively through the vesting of restricted stock awards granted in January 2023 for the portion of their fiscal year 2022 annual incentives not paid in cash. | | (b) The amount shown is the total gross dollar value realized upon the vesting of the PSUs and the restricted stock, based on the closing price of our common stock on the vesting dates, and the applicable Dividend Equivalents paid on the earned PSUs. The restricted stock vested on January 19, 2024 with a closing price of $61.33 and the PSUs vested on February 21, 2025 with a closing price of $61.26. |

  96. Pension Benefits During Fiscal Year 2024

    Pension Benefits During Fiscal Year 2024

  97. Pension Benefits During Fiscal Year 2024

    | Name* | Plan Name | Number of Years Credited Service (#)(a) | Present Value of Accumulated Benefit ($)(b) | Payments During Last Fiscal Year ($) | | Mr. Mezger | Retirement Plan | 31 | $11,480,010 | $— |

  98. Pension Benefits During Fiscal Year 2024

    | * Messrs. Kaminski, McGibney, Praw and Woram are not participants in the Retirement Plan, as the plan was open for a limited period and closed to new participants in 2004. | | (a) Number of Years of Credited Service. This is as of the valuation date. As of November 30, 2024, Mr. Mezger is fully vested in his Retirement Plan benefit. | | (b) Present Value of Accumulated Benefit. This amount represents the actuarial present value of the total retirement benefit that would be payable to Mr. Mezger under the Retirement Plan as of November 30, 2024. The payment of Retirement Plan benefits is described under “Retirement Programs.” The following key actuarial assumptions and methodologies were used to calculate this present value: the base benefit is assumed to begin as of the earliest possible date (generally the later of age 55 or the 10th anniversary of the commencement of participation); the base benefit is adjusted by past and future cost of living adjustments including a 2.5% increase for the fiscal year ending November 30, 2025 and an assumed 2.25% annual increase thereafter, until the last benefits are paid. The discount rate used to calculate the present value of the accumulated benefit shown in the table was 4.94%. Mr. Mezger is entitled to receive a lump sum payment of the actuarial value (as specified under the Retirement Plan) of his plan benefits in the event of a change in control or death. If any such event occurred on November 30, 2024, the payment to Mr. Mezger would be $12,308,921, using a 4.15% Applicable Federal Rate discount rate, as specified under the Retirement Plan. |

  99. Pension Benefits During Fiscal Year 2024

    | 44 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  100. Pension Benefits During Fiscal Year 2024

    | Executive Compensation Non-Qualified Deferred Compensation During Fiscal Year 2024 |

  101. Non-Qualified Deferred Compensation During Fiscal Year 2024

    Non-Qualified Deferred Compensation During Fiscal Year 2024

  102. Non-Qualified Deferred Compensation During Fiscal Year 2024

    | Name | Executive Contributions in Last Fiscal Year ($)(a) | Registrant Contributions in Last Fiscal Year ($)(b) | Aggregate Earnings in Last Fiscal Year ($)(c) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at Last Fiscal Year End ($)(d) | | Mr. Mezger | $46,000 | $46,000 | $1,270,276 | $— | $5,603,745 | | Mr. Kaminski | 50,425 | 29,725 | 389,459 | — | 1,738,194 | | Mr. McGibney | 53,500 | 32,800 | 173,551 | — | 939,785 | | Mr. Praw | 42,025 | 21,325 | 221,709 | — | 935,222 | | Mr. Woram | 28,017 | 14,217 | 177,903 | — | 1,070,587 |

  103. Non-Qualified Deferred Compensation During Fiscal Year 2024

    | (a) Executive Contributions in Last Fiscal Year. These amounts reflect compensation the NEOs earned in 2024 that they have voluntarily deferred. The amounts are included in the Summary Compensation Table. | | (b) Registrant Contributions in Last Fiscal Year. These amounts are matching contributions we made to the NEOs’ voluntary contributions to our DCP and are included in the Summary Compensation Table. The DCP is discussed under “Retirement Programs.” | | (c) Aggregate Earnings in Last Fiscal Year. These amounts do not include any above-market or preferential earnings. Accordingly, these amounts are not reported in the Summary Compensation Table. | | (d) Aggregate Balance at Last Fiscal Year End. These amounts reflect compensation the NEOs earned in 2024 or in prior years, but which they voluntarily elected to defer receipt, adjusted for changes in the value of their investments and distributions, if any. All the NEOs are fully vested in their respective balances. A portion of these amounts was previously reported as deferred compensation in the Summary Compensation Tables in our proxy statements for our 2023 and 2024 annual meetings. |

  104. Pay Versus Performance

    Pay Versus Performance The following table presents information as required under Item 402(v) of SEC Regulation S-K regarding the relationship for the four most recently completed fiscal years between the compensation of our NEOs – as reported in the Summary Compensation Table and adjusted to reflect “compensation actually paid” (“CAP”) as defined under SEC rules – and our performance relative to the identified metrics. Our compensation philosophy and how we align executive compensation with our performance is described under “Compensation Discussion and Analysis.” The CAP amounts disclosed do not reflect the actual amount of compensation earned, realized, or received by our NEOs during the applicable fiscal year. The Compensation Committee did not consider the information provided in this section in making its compensation decisions for the years shown.

  105. Pay Versus Performance

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 45 |

  106. Pay Versus Performance

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | | Fiscal Year | Summary Compensation Table Total for PEO ($) | Compensation Actually Paid to PEO ($)(a) | Average Summary Compensation Table Total for Other NEOs ($)(b) | Average Compensation Actually Paid to Other NEOs ($)(a)(b) | Total Stockholder Return ($)(c) | Peer Group Total Stockholder Return ($)(d) | Net Income ($000s)(e) | AEPS ($)(f) | | 2024 | $16,709,331 | $51,037,727 | $4,439,688 | $11,843,645 | $249.67 | $255.39 | $655,018 | $8.45 | | 2023 | 15,689,055 | 43,713,700 | 4,483,491 | 10,469,248 | 155.12 | 176.92 | 590,177 | 7.18 | | 2022 | 15,814,791 | 12,168,706 | 4,416,324 | 4,273,279 | 92.08 | 112.90 | 816,666 | 9.36 | | 2021 | 14,366,518 | 25,125,414 | 4,556,264 | 7,144,468 | 115.18 | 133.37 | 564,746 | 6.14 |

  107. Pay Versus Performance

    | (a) To calculate CAP per SEC rules, adjustments were made to the amounts reported in the Summary Compensation Table for the applicable fiscal year. A reconciliation of the adjustments for the PEO and for the average of the other NEOs is set forth below. |

  108. Pay Versus Performance

    | | 2024 | | | | PEO | Average Other NEOs | | Summary Compensation Table Total | $16,709,331 | $4,439,688 | | Adjustments: | | | | Grant date fair value of stock awards from Summary Compensation Table | (8,699,979) | (1,242,459) | | Fair value at fiscal year end of outstanding and unvested equity awards granted in the fiscal year(1) | 15,708,206 | 2,296,531 | | Change in fair value of outstanding and unvested equity awards granted in prior fiscal years(2) | 23,688,459 | 5,789,808 | | Change in fair value as of the vesting date of equity awards granted in prior fiscal years that vested in the fiscal year(3) | 3,146,752 | 470,605 | | Dividends paid on awards during the year before vesting | 626,075 | 89,472 | | “Change in pension value and nonqualified deferred compensation earnings” from Summary Compensation Table | (482,359) | — | | Service cost for pension plans | 341,242 | — | | Compensation Actually Paid (as calculated per SEC rules) | $51,037,727 | $11,843,645 |

  109. Pay Versus Performance

    | (1) Represents the aggregate fair value as of the indicated fiscal year-end of outstanding and unvested stock awards granted during such fiscal year, calculated using the same methodology used for financial statement reporting purposes. | | (2) Represents the aggregate change in fair value during the indicated fiscal year of the outstanding and unvested stock awards and option awards held, as of the last day of the indicated fiscal year, calculated using the same methodology used for financial statement reporting purposes. For awards subject to performance-based vesting conditions, the fair value is based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year. | | (3) Represents the aggregate change in fair value, measured from the prior fiscal year-end to the vesting date, of each stock award and option award, that was granted in a prior fiscal year and which vested during the indicated fiscal year, calculated using the same methodology used for financial statement reporting purposes. |

  110. Pay Versus Performance

    | (b) Mr. Mezger served as our PEO for each fiscal year shown. Our other NEOs were as follows: Messrs. Kaminski, McGibney, Praw and Woram for the 2024, 2023 and 2022 fiscal years; and Messrs. Kaminski, McGibney and Praw, and Matthew W. Mandino for the 2021 fiscal year. |

  111. Pay Versus Performance

    | (c) The amounts reported reflect the cumulative total stockholder return (“TSR”) on our common stock for each of the last four fiscal years ended November 30, 2024, assuming an investment of $100 on November 30, 2020, and the reinvestment of dividends. |

  112. Pay Versus Performance

    | (d) The peer group used in this disclosure is the Dow Jones US Home Construction Index, which is the same index we used in the Stock Performance Graph in our Annual Report. The amounts reported reflect the cumulative TSR of the Dow Jones US Home Construction Index for each of the last four fiscal years ended November 30, 2024, assuming an investment of $100 on November 30, 2020, and the reinvestment of dividends. |

  113. Pay Versus Performance

    | (e) Represents net income reported in our audited consolidated financial statements for each of the applicable fiscal years. |

  114. Pay Versus Performance

    | (f) Annex 2 to this Proxy Statement contains a reconciliation of our diluted earnings per share calculated in accordance with GAAP to the non-GAAP financial measure of AEPS. We included AEPS as our company-selected financial measure as this metric has the largest weighting in determining our NEO’s long-term incentive compensation, a significant component of their overall compensation. |

  115. Pay Versus Performance

    | 46 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  116. Pay Versus Performance

    Relationship between CAP and Financial Performance Measures The graphs below illustrate the relationships between CAP for the PEO and the average CAP for our other NEOs, with (i) the cumulative TSR of our common stock, (ii) our AEPS, and (iii) our net income, each as set forth in the Pay Versus Performance table above, as well as the relationship between the cumulative TSR of our common stock and of the Dow Jones US Home Construction Index.

  117. Pay Versus Performance

    | CAP vs. Cumulative TSR | CAP vs. AEPS | | | | | CAP vs. Net Income | KB Home and Peer Cumulative TSR Comparison | | | |

  118. Pay Versus Performance

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 47 |

  119. Pay Versus Performance

    | Executive Compensation CEO Pay Ratio |

  120. Pay Versus Performance

    Pay Versus Performance Tabular List Below is a list of the most important financial performance measures we used to link CAP for our NEOs to our performance for the fiscal year ended November 30, 2024. Our use of these measures is discussed under “Compensation Discussion and Analysis.”

  121. Pay Versus Performance

    | ■ | AEPS (the company-selected measure); | | ■ | AROIC; | | ■ | Adjusted pretax income; | | ■ | Revenue growth, relative to our peer group; | | ■ | Strategic measures, to the extent they incorporate or reflect financial performance metrics. |

  122. CEO Pay Ratio

    CEO Pay Ratio For our last completed fiscal year ended November 30, 2024:

  123. CEO Pay Ratio

    | ■ | The annual total compensation of our median employee (excluding Mr. Mezger), based on W-2 compensation paid in the 12-month period ended November 30, 2024, and calculated consistent with how NEO total compensation is calculated for the Summary Compensation Table, was $110,582. | | ■ | Mr. Mezger’s annual total compensation, as reported in the 2024 Summary Compensation Table, was $16,709,331. | | ■ | Based on this information, the ratio of Mr. Mezger’s annual total compensation to our identified median employee’s is 151 to 1. |

  124. CEO Pay Ratio

    As of November 30, 2024, we had approximately 2,392 full-time and part-time employees. In identifying the median employee, we excluded our CEO and five employees who did not have regular earnings in the fiscal year due to extended leaves of absence. Because companies are allowed to identify the median employee and determine a CEO pay ratio using various methodologies, estimates and assumptions applicable to their own employee populations, compensation practices and other circumstances, the pay ratio other companies report – including those in our peer group – may not be comparable to the foregoing pay ratio.

  125. Potential Payments Upon Termination of Employment or Change in Control

    Potential Payments Upon Termination of Employment or Change in Control Based on the terms of certain of our employee benefit plans – primarily our Executive Severance Plan and our CIC Plan – our NEOs are entitled to certain payments and other benefits if their employment is terminated under certain circumstances and/or if we experience a change in control. Mr. Mezger is also entitled to certain payments and other benefits in such circumstances under the terms of his Employment Agreement. Per Section 409A of the Code, certain payments to our NEOs would not commence for six months following a termination of employment. Termination of Employment If we terminate Mr. Mezger without cause or he resigns for good reason (each as defined in his Employment Agreement), or if we terminate any of the other NEOs without cause (as defined in the Executive Severance Plan), each is entitled to receive a cash severance payment equal to a multiple of base salary and average bonus. For Mr. Mezger, the severance amount is 2.0 times the sum of his annual salary plus average annual bonus earned for the prior three years, with the total payment capped at $6.0 million. Mr. Mezger would additionally receive a prorated bonus for the year in which his employment terminates. For our other NEOs, the severance amount is 2.0 times the sum of their respective annual base salary in effect at the time of termination and average bonus. The applicable average bonus is the lesser of (a) the average of the annual cash bonuses, if any, paid to them for the three most recent completed fiscal years prior to termination; or (b) 3.0 times their annual base salary. Each NEO is also entitled to a continuation of health coverage for up to two years. In each case, the foregoing benefits are subject to an affected NEO’s executing a release and post-termination non-solicitation (for two years), non-disparagement and confidentiality obligations. For equity awards granted to Mr. Mezger on and after the effective date of his Employment Agreement, he is entitled to (a) two years of additional service credited to compute equity vesting plus full vesting for any equity issued to him in lieu of cash bonuses; (b) the earlier of 36 months and the original term duration of each equity grant to exercise any such outstanding equity; and (c) performance shares paid as if the performance period closed on the termination date if the performance period would otherwise close in the next 24 months.

  126. Potential Payments Upon Termination of Employment or Change in Control

    | 48 | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement |

  127. Potential Payments Upon Termination of Employment or Change in Control

    Change in Control If Mr. Mezger’s employment is terminated without cause or he resigns for good reason in a change in control (generally, per his Employment Agreement, during the period starting three months before and ending 12 months after a change in control), he is entitled, subject to the same conditions described under “Termination of Employment,” to (a) a severance payment as described above, with a 3.0 times multiple rather than 2.0 times and total payment capped at $12.0 million; (b) health coverage continuation for up to two years; (c) full vesting and lump sum cash payment of deferred compensation, retirement or other employee benefits per the relevant arrangements, with any lump sum payments subject to Section 409A of the Code permitted only as provided by those arrangements; and (d) an additional amount to compensate for any excise taxes under Section 280G of the Code (“Section 280G”). If a change of control occurs, each of our other NEOs is entitled to receive, upon executing a release and if in the following 18-month period his employment is terminated other than for cause or disability, or he terminates employment for good cause (in each case, as defined in the CIC Plan), a severance benefit of 2.0 times the sum of his average base salary and average actual annual cash bonus for the three fiscal years prior to the year in which the change in control occurs. While Mr. Mezger is a CIC Plan participant, he can receive only CIC Plan benefits that do not duplicate those provided under his Employment Agreement, and his total CIC Plan severance benefit is capped at $12.0 million. Per the terms of each recipient’s award agreement, the vesting of our NEOs’ outstanding equity awards will not accelerate upon a change in control unless the recipient is terminated without cause or resigns for good reason within 18 months. Generally, if such a termination occurs (a) within the first year of the award’s performance period, the recipient will receive a target payout; (b) after the first year of the award’s performance period, the recipient will receive a payout determined using prorated calculations of the applicable performance measures; and (c) before the award’s performance period begins, the recipient will receive no payout of the award. In addition, under the CIC Plan, only Mr. Mezger and four other senior executives can potentially receive an additional tax restoration amount to compensate for any excise taxes imposed on them under Section 280G and for any taxes on the additional amount. Pursuant to a Board policy, since April 7, 2011, we have not extended this tax restoration benefit to any other officer or employee, including all the other NEOs, even though they are CIC Plan participants. Other Change in Control and Employment Termination Provisions Our restricted stock award agreements provide for accelerated vesting upon the recipient’s death or disability. Our PSU award agreements provide for pro rata vesting if the recipient retires under certain circumstances, and for accelerated vesting upon death or disability; provided that any payout is delayed until the performance period is completed. The time a recipient can exercise a common stock option after termination of employment depends on the reason for termination. For example, they may have only five days if termination is for cause; while for retirement, death or disability, they may have the original term. Our DCP provides for full vesting of benefits if there is a change in control or disability, as defined under the plan, or death. Under our Retirement Plan, a participant will immediately receive a lump sum payment of the actuarial value (as specified under the plan) of the participant’s plan benefits if there is a change in control or death. Our DBO Plan provides for (a) distribution of an insurance contract to a participant sufficient to pay the death benefit (if death occurs before age 100); and (b) an additional tax restoration amount sufficient to pay specified taxes caused thereby, if there is a change in control as defined in the plan. We also maintain term life insurance policies that pay benefits upon certain NEOs’ deaths, as described under “Death Benefits.” The tables below show payments our NEOs may receive assuming various employment termination and change in control scenarios occurred on November 30, 2024, with equity awards valued at the $82.74 closing price of our common stock on that date. The tables reflect that references to “bonuses” in Mr. Mezger’s Employment Agreement, the Executive Severance Plan or the CIC Plan include the amounts in the Summary Compensation Table’s “Non-Equity Incentive Plan Compensation” column. The amounts shown do not include the value of unexercised stock options reported in the Outstanding Equity Awards at Fiscal Year-End 2024 table, accrued Retirement Plan and DCP amounts reported in the Pension Benefits During Fiscal Year 2024 table and the Non-Qualified Deferred Compensation During Fiscal Year 2024 table (and associated footnotes), respectively, or term life insurance benefits, or generally available employee benefits. In none of the change in control scenarios below would our NEOs receive a tax restoration benefit under the CIC Plan, nor would our CEO receive a tax restoration benefit under his Employment Agreement.

  128. Potential Payments Upon Termination of Employment or Change in Control

    | KB Home 2025 Annual Meeting of Stockholders and Proxy Statement | 49 |

  129. Potential Payments Upon Termination of Employment or Change in Control

    Potential Payments Upon Termination Of Employment Or Change In Control

  130. Post-Employment Payments — Mr. Mezger

    | Executive Payments and Benefits upon Termination or Change in Control | Voluntary Termination | Involuntary Termination for Cause | Involuntary Termination Without Cause/ Termination for Good Reason | Change in Control Without Termination | Change in Control With Termination for Good Reason or Without Cause | Death | Disability | | Severance | $— | $— | $14,846,822 | $— | $20,846,822 | $— | $— | | Long-term Incentives(a) | | | | | | | | | Restricted Stock | — | — | 4,852,866 | — | 5,610,351 | 5,610,351 | 5,610,351 | | PSUs | 32,608,678 | — | 43,964,237 | — | 43,964,237 | 52,289,647 | 52,289,647 | | DBO Plan(b) | — | — | — | 1,031,661 | 1,031,661 | 1,652,893 | — | | Health Benefits(c) | — | — | 83,695 | — | 83,695 | — | — | | Credited Vacation(d) | 88,462 | 88,462 | 88,462 | — | 88,462 | 88,462 | 88,462 | | TOTAL | $32,697,140 | $88,462 | $63,836,082 | $1,031,661 | $71,625,228 | $59,641,353 | $57,998,460 |

  131. Post-Employment Payments — Mr. Kaminski

    | Executive Payments and Benefits upon Termination or Change in Control | Voluntary Termination | Involuntary Termination for Cause | Involuntary Termination Without Cause/ Termination for Good Reason | Change in Control Without Termination | Change in Control With Termination for Good Reason or Without Cause | Death | Disability | | Severance | $— | $— | $5,992,923 | $— | $5,853,201 | $— | $— | | Long-term Incentives(a) | | | | | | | | | PSUs | 9,104,354 | — | 9,104,354 | — | 12,233,883 | 12,384,542 | 12,384,542 | | Health Benefits(b) | — | — | 63,611 | — | — | — | — | | TOTAL | $9,104,354 | $— | $15,160,888 | $— | $18,087,084 | $12,384,542 | $12,384,542 |

  132. Post-Employment Payments — Mr. McGibney

    | Executive Payments and Benefits upon Termination or Change in Control | Voluntary Termination | Involuntary Termination for Cause | Involuntary Termination Without Cause/ Termination for Good Reason | Change in Control Without Termination | Change in Control With Termination for Good Reason or Without Cause | Death | Disability | | Severance | $— | $— | $7,200,000 | $— | $7,337,080 | $— | $— | | Long-term Incentives(a) | | | | | | | | | PSUs | — | — | — | — | 17,680,803 | 21,143,170 | 21,143,170 | | Health Benefits(b) | — | — | 78,216 | — | — | — | — | | TOTAL | $— | $— | $7,278,216 | $— | $25,017,883 | $21,143,170 | $21,143,170 |

  133. Post-Employment Payments — Mr. Praw

    | Executive Payments and Benefits upon Termination or Change in Control | Voluntary Termination | Involuntary Termination for Cause | Involuntary Termination Without Cause/ Termination for Good Reason | Change in Control Without Termination | Change in Control With Termination for Good Reason or Without Cause | Death | Disability | | Severance | $— | $— | $4,862,483 | $— | $4,735,261 | $— | $— | | Long-term Incentives(a) | | | | | | | | | PSUs | 5,843,499 | — | 5,845,499 | — | 7,837,436 | 8,960,073 | 8,960,073 | | DBO Plan(b) | — | — | — | 1,393,398 | 1,393,398 | 2,012,072 | — | | Health Benefits(c) | — | — | 63,611 | — | — | — | — | | TOTAL | $5,843,499 | $— | $10,769,593 | $1,393,398 | $13,966,095 | $10,972,145 | $8,960,073 |

  134. Post-Employment Payments — Mr. Woram

    | Executive Payments and Benefits upon Termination or Change in Control | Voluntary Termination | Involuntary Termination for Cause | Involuntary Termination Without Cause/ Termination for Good Reason | Change in Control Without Termination | Change in Control With Termination for Good Reason or Without Cause | Death | Disability | | Severance | $— | $— | $4,607,085 | $— | $4,479,863 | $— | $— | | Long-term Incentives(a) | | | | | | | | | Restricted Stock | — | — | — | — | 352,059 | 352,059 | 352,059 | | PSUs | 5,520,654 | — | 5,520,654 | — | 7,407,281 | 8,524,719 | 8,524,719 | | Health Benefits(b) | — | — | 63,611 | — | — | — | — | | TOTAL | $5,520,654 | $— | $10,191,350 | $— | $12,239,203 | $8,876,778 | $8,876,778 |