Exhibit 10.5

 

CARE CAPITAL PROPERTIES, INC.
NON-EMPLOYEE DIRECTOR
DEFERRED STOCK COMPENSATION PLAN

 

ARTICLE 1
INTRODUCTION

 

1.1                               Establishment.  Care Capital Properties, Inc.
(the “Company”) hereby establishes the Care Capital Properties, Inc.
Non-Employee Director Deferred Stock Compensation Plan (the “Plan”) for those
directors of the Company who are not employees of the Company or any of its
subsidiaries or affiliates. The Plan allows Non-Employee Directors to defer the
receipt of cash compensation and to receive such deferred compensation in the
form of Shares.

 

1.2                               Purpose.  The Plan is intended to advance the
interests of the Company and its stockholders by providing a means to attract
and retain qualified persons to serve as Non-Employee Directors and to promote
ownership by Non-Employee Directors of a greater proprietary interest in the
Company, thereby aligning such Directors’ interests more closely with the
interests of stockholders of the Company.

 

1.3                               Effective Date.  The Plan shall become
effective as of the date of consummation of the distribution of the shares of
the Company to the shareholders of Ventas, Inc. (the “Effective Date”).

 

ARTICLE 2
DEFINITIONS

 

Certain terms used in the Plan have the meanings set forth in Appendix I hereto.

 

ARTICLE 3
SHARES AVAILABLE UNDER THE PLAN

 

Subject to adjustment as provided in Article 10, the maximum number of Shares
that may be distributed in settlement of Stock Unit Accounts under the Plan
shall be five hundred thousand (500,000). Such Shares may include authorized but
unissued Shares, treasury Shares or Shares that have been reacquired by the
Company.

 

ARTICLE 4
ADMINISTRATION

 

The Plan shall be administered by the Compensation Committee of the Board or
such other committee as may be designated by the Board.  The Committee shall
have the authority to make all determinations it deems necessary or advisable
for administering the Plan, subject to the express provisions of the Plan. 
Notwithstanding the foregoing, no Director who is a Participant under the Plan
shall participate in any determination relating solely or primarily to his or
her own Shares, Stock Units or Stock Unit Account.

 

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ARTICLE 5
ELIGIBILITY

 

Each person who is a Non-Employee Director on a Deferral Date shall be eligible
to defer Fees payable on such date in accordance with Article 6 of the Plan.  If
any Non-Employee Director subsequently becomes an employee of the Company or any
of its subsidiaries or affiliates, but does not incur a Termination of Service,
such Director shall continue as a Participant with respect to Fees previously
deferred, but shall cease eligibility with respect to all future Fees, if any,
earned while an employee.

 

ARTICLE 6
DEFERRAL ELECTIONS IN LIEU OF CASH PAYMENTS

 

6.1                               General Rule.  Each Non-Employee Director may,
in lieu of receipt of Fees, defer any or all of such Fees in accordance with
this Article 6; provided, that such Non-Employee Director is eligible under
Article 5 of the Plan to defer such Fees at the date any such Fees are otherwise
payable.  A Director may elect to defer a percentage of his or her Fees or a
specific dollar amount of his or her Fees in accordance with administrative
procedures established with respect to the Plan.

 

6.2                               Timing of Election.  Each Non-Employee
Director who is serving on the Board on the Effective Date may make a Deferral
Election at any time prior to the Effective Date.  Any person who is not then
serving as a Non-Employee Director may make a Deferral Election before the first
date on which he or she is entitled to receive Fees.  A Non-Employee Director
who does not make a Deferral Election when first eligible to do so may make a
Deferral Election at such time before any subsequent calendar year in accordance
with administrative procedures established with respect to the Plan.

 

6.3                               Effect and Duration of Election.  A Deferral
Election shall apply to Fees payable after the date such election is made and
shall be deemed to be continuing and applicable to all Fees payable in
subsequent calendar years, unless the Participant revokes or modifies such
election by filing a new election form at such time before the first day of any
subsequent calendar year in accordance with administrative procedures
established with respect to the Plan, effective for all Fees payable on and
after the first day of such calendar year.

 

6.4                               Form of Election.  A Deferral Election shall
be made in a manner satisfactory to the Committee.  Generally, a Deferral
Election shall be made by completing and filing the specified election form with
the Corporate Secretary of the Company or his or her designee within the period
described in Section 6.2 or Section 6.3.

 

6.5                               Establishment of Stock Unit Account.  The
Company shall establish a Stock Unit Account for each Participant.  All Fees
deferred pursuant to this Article 6 shall be credited to the Participant’s Stock
Unit Account as of the Deferral Date and converted to Stock Units.  The number
of Stock Units credited to a Participant’s Stock Unit Account as of a Deferral
Date shall equal the amount of the deferred Fees divided by the Fair Market
Value of a Share on such Deferral Date, with fractional units calculated to
three decimal places.  Fractional Stock Units shall be credited cumulatively,
but any fractional Stock Unit in a Participant’s Stock Unit

 

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Account at the time of a distribution under Article 7 shall be converted into
cash equal to the Fair Market Value of a corresponding fractional Share on the
date of distribution.

 

6.6                               Crediting of Dividend Equivalents.  As of each
dividend payment date with respect to Shares, each Participant shall be paid
outright or have credited to his or her Stock Unit Account, as elected in
advance by the Participant in accordance with procedures established by the
Committee, a dollar amount equal to the amount of cash dividends that would have
been paid on the number of Shares equal to the number of Stock Units credited to
the Participant’s Stock Unit Account as of the close of business on the record
date for such dividend.  Such dollar amount, if credited to the Participant’s
Stock Unit Account, shall then be converted into a number of Stock Units equal
to the number of whole and fractional Shares that could have been purchased with
such dollar amount at the Fair Market Value of a Share on the dividend payment
date.

 

ARTICLE 7
SETTLEMENT OF STOCK UNITS

 

7.1                               Timing of Payment.  A Participant shall
receive or begin receiving a distribution of his or her Stock Unit Account in
the manner described in Section 7.2 either (i) on or as soon as administratively
feasible after the Participant incurs a Termination of Service, (ii) if the
Participant has made an election to defer payment in accordance with this
Section 7.1, on or as soon as administratively feasible after January 1 of the
year immediately following the date on which the Participant incurs a
Termination of Service, or (iii) if the Participant has made an election to
defer payment in accordance with this Section 7.1, on or as soon as
administratively feasible after the date specified by the Participant.  A
Participant must deliver an election to defer the distribution or commencement
of distribution to the Corporate Secretary of the Company or his or her designee
such period in advance and in such manner as determined by the Committee.

 

7.2                               Payment Options.  A Deferral Election filed
under Article 6 shall specify whether the Participant’s Stock Unit Account is to
be settled by delivering to the Participant the number of Shares equal to the
number of whole Stock Units then credited to the Participant’s Stock Unit
Account, in either (i) a lump sum, or (ii) substantially equal annual
installments over a period not to exceed ten years; provided, that such
installment payments do not extend more than ten years after the Participant’s
Termination of Service as a Director.  Any fractional Stock Unit credited to a
Participant’s Stock Unit Account at the time of a distribution shall be paid in
cash at the time of such distribution.  A Participant may change the manner in
which his or her Stock Unit Account is distributed in accordance with such
procedures established by the Committee.

 

7.3                               Payment upon Death of a Participant.  If a
Participant dies before the entire balance of his or her Stock Unit Account has
been distributed, the balance of the Participant’s Stock Unit Account shall be
paid in Shares (and cash for any fractional Stock Unit, if applicable) as soon
as administratively feasible after the Participant’s death, to the beneficiary
designated by the Participant under Article 9.

 

7.4                               Continuation of Dividend Equivalents.  If
payment of Stock Units is deferred pursuant to Section 7.2, the Participant’s
Stock Unit Account shall continue to be credited with

 

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dividend equivalents as provided in Section 6.6 until the entire balance of the
Participant’s Stock Unit Account has been distributed.

 

ARTICLE 8
UNFUNDED STATUS

 

8.1                               General.  The interest of each Participant in
any Fees deferred under the Plan (and any Stock Units or Stock Unit Account
relating thereto) shall be that of a general creditor of the Company.  Stock
Unit Accounts, and Stock Units credited thereto, shall at all times be
maintained by the Company as bookkeeping entries evidencing unfunded and
unsecured general obligations of the Company.  Except as provided in
Section 8.2, no money or other assets shall be set aside for any Participant.

 

8.2                               Trust.  To the extent determined by the Board,
the Company may transfer funds necessary to fund all or part of the payments
under the Plan to a trust; provided, that the assets held in such trust shall
remain at all times subject to the claims of the general creditors of the
Company.  No participant or beneficiary shall have any interest in the assets
held in such trust or in the general assets of the Company other than as a
general, unsecured creditor.  Accordingly, the Company shall not grant a
security interest in the assets held by the trust in favor of any Participant,
beneficiary or creditor.

 

ARTICLE 9
DESIGNATION OF BENEFICIARY

 

Each Participant may designate, on a form provided by the Committee, one or more
beneficiaries to receive payment of the Participant’s Stock Unit Account in the
event of such Participant’s death.  The Company may rely upon the beneficiary
designation list filed with the Committee; provided, that such form was executed
by the Participant or his or her legal representative and filed with the
Committee prior to the Participant’s death.  If a Participant has not designated
a beneficiary, or if the designated beneficiary is not surviving when a payment
is to be made to such person under the Plan, the beneficiary with respect to
such payment shall be the Participant’s surviving spouse, or if there is no
surviving spouse, the Participant’s estate.

 

ARTICLE 10
ADJUSTMENT PROVISIONS

 

In the event of a reorganization, recapitalization, stock split, stock dividend,
spin-off, combination, corporate exchange, merger, consolidation or other change
in the Common Stock or any distribution to stockholders of Common Stock other
than cash dividends or any transaction determined in good faith by the Board or
Committee to be similar to the foregoing, the Board or Committee shall make
appropriate equitable changes in the number and type of Shares authorized by the
Plan, and the number and type of Shares to be delivered upon settlement of Stock
Unit Accounts under Article 7.  Any adjustments pursuant to this Article 10 to
Stock Units that are considered 409A Stock Units are intended to be made only if
permitted by Code Section 409A and only in a manner in compliance with the
requirements of Code Section 409A and any adjustments made pursuant to this
Article 10 to Stock Units that are not considered 409A Stock Units are intended
to be made only if and in such a manner that after

 

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such adjustment the Stock Units either continue not to be 409A Stock Units or
comply with the requirements of Code Section 409A.

 

ARTICLE 11
GENERAL PROVISIONS

 

11.1                        No Stockholder Rights Conferred.  Nothing contained
in the Plan will confer upon any Participant or beneficiary any rights of a
stockholder of the Company, unless and until Shares are in fact issued or
transferred to such Participant or beneficiary in accordance with Article 7.

 

11.2                        Changes to the Plan.  The Board may amend, alter,
suspend, discontinue, extend, or terminate the Plan without the consent of
Participants; provided, that no action taken without the consent of an affected
Participant may materially impair the rights of such Participant with respect to
any Stock Units credited to his or her Stock Unit Account at the time of such
change or termination, except that the Board may without the consent of any
Participant terminate the Plan and pay out Shares with respect to Stock Units
then credited to each Participant’s Stock Unit Account.

 

11.3                        Compliance with Laws and Obligations.  The Company
will not be obligated to issue or deliver Shares in connection with the Plan in
a transaction subject to the registration requirements of the Securities Act of
1933, as amended, or any other federal or state securities law, any requirement
under any listing agreement between the Company and any national securities
exchange or automated quotation system or any other laws, regulations, or
contractual obligations of the Company, until the Company is satisfied that such
laws, regulations and other obligations of the Company have been complied with
in full.  Certificates, if any, representing Shares delivered under the Plan
will be subject to such restrictions as may be applicable under such laws,
regulations and other obligations of the Company.

 

11.4                        Limitations on Transferability.  Stock Units and
other rights under the Plan may not be pledged, mortgaged, hypothecated or
otherwise encumbered, and shall not be subject to the claims of creditors of any
Participant.

 

11.5                        Governing Law.  The validity, construction and
effect of the Plan and any agreement hereunder will be determined in accordance
with the Delaware General Corporation Law.

 

11.6                        Plan Termination.  Unless earlier terminated by
action of the Board, the Plan will remain in effect until such time as no Shares
remain available for delivery under the Plan and the Company has no further
rights or obligations under the Plan.

 

ARTICLE 12
COMPLIANCE WITH CODE SECTION 409A

 

12.1                        409A Stock Units.  The provisions of this Article 12
apply to any 409A Stock Units, notwithstanding any provisions to the contrary
contained in the Plan or the Deferral Election.  The Company intends that Stock
Units payable under the Plan shall satisfy the requirements for exemption from,
or compliance with, Code Section 409A and that all terms and

 

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provisions shall be interpreted, operated and administered to satisfy such
requirements.  It is intended that each 409A Stock Unit complies with the
deferral, payout and other limitations and restrictions imposed under Code
Section 409A.  This Article 12 is not intended to impose any restrictions on
Stock Units other than those required for the Participant not to incur
additional tax under Code Section 409A and shall be interpreted and operated
accordingly.  Notwithstanding any other provision in the Plan, the Company makes
no representation that Stock Units under the Plan shall be exempt from, or
comply with, Code Section 409A and makes no undertaking to preclude Code
Section 409A from applying to Stock Units granted under the Plan.  No provision
of the Plan shall be interpreted or construed to transfer any liability for
failure to comply with Code Section 409A from the Participant or any other
individual to the Company.

 

12.2                        Deferral Elections.  Except as otherwise permitted
or required by Code Section 409A, the following requirements apply to any
Deferral Election that may be permitted or required by the Committee pursuant to
a 409A Stock Unit: (i) a Deferral Election must be in writing and specify the
amount being deferred and the time and form of distribution as permitted by the
Plan; and (ii) a Deferral Election shall become irrevocable as of the deadline
specified by the Committee, which shall not be later than December 31 of the
year preceding the year in which services are performed for such Fees.

 

12.3                        Subsequent Elections.  Except as otherwise permitted
or required by Code Section 409A, a 409A Stock Unit which permits a subsequent
Deferral Election to further defer the distribution or change the form of
distribution shall comply with the following requirements: (i) no subsequent
Deferral Election may take effect until at least 12 months after the date on
which the subsequent Deferral Election is made; (ii) each subsequent Deferral
Election related to a distribution upon Termination of Service, a specified time
or a 409A Change in Control must result in a delay of the distribution for a
period of not less than five years from the date such distribution would
otherwise have been made; and (iii) no subsequent Deferral Election related to a
distribution to be made at a specified time or pursuant to a fixed schedule
shall be made less than 12 months prior to the date the first scheduled payment
would otherwise be made.

 

12.4                        Distributions.  Except as otherwise permitted or
required by Code Section 409A, no distribution in settlement of a 409A Stock
Unit may commence earlier than: (i) Termination of Service; (ii) a specified
time (or pursuant to a fixed schedule) that is specified by the Participant in a
Deferral Election complying with this Article 12; or (iii) a 409A Change in
Control. Notwithstanding anything to the contrary, to the extent that
distribution of a 409A Stock Unit is triggered by a Participant’s Termination of
Service, if the Participant is then a Specified Employee, no distribution shall
be made before the earlier of (i) six months after the Participant’s Termination
of Service or (ii) the date of the Participant’s death.  Should the limitation
set forth in the preceding sentence result in payment later than otherwise
provided in the Plan or 409A Stock Unit, on the first day any such payment may
be made without incurring additional tax pursuant to Code Section 409A, such
payment shall be made to the Participant in one transfer. Notwithstanding
anything contained in the Plan or Stock Unit to the contrary, the date on which
a Participant’s Termination of Service occurs shall be treated as the
Participant’s termination of employment or service date or comparable concept
for purposes of determining the timing of distributions under the Plan and Stock
Unit to the extent necessary to have such distributions under the Plan and Stock
Unit be exempt from or comply with the requirements of Code Section 409A.  If a
409A Stock Unit is to be paid in two or more installments, for purposes of Code

 

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Section 409A, each installment shall be treated as a separate payment.  No 409A
Stock Unit shall be subject to acceleration or to any change in the specified
time or schedule of distribution, except as permitted by Code Section 409A or as
otherwise provided under the Plan or Stock Unit and consistent with Code
Section 409A.

 

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APPENDIX I

 

“409A Change in Control” means to the extent necessary for the 409A Stock Units
to comply with Code Section 409A, at a minimum a change in the ownership or
effective control of the Company, or in the ownership of a substantial portion
of the assets of the Company, within the meaning of subsection (a)(2)(A)(v) of
Code Section 409A.

 

“409A Stock Unit” means a Stock Unit that constitutes “deferral of compensation”
subject to the requirements of Code Section 409A.

 

“Board” means the Board of Directors of the Company.

 

“Code Section 409A” means section 409A of the Internal Revenue Code of 1986, as
amended.

 

“Committee” means the Compensation Committee of the Board or such other
committee appointed to administer the Plan under Article 4.

 

“Common Stock” means the class of Company capital stock designed as common
stock, or, in the event that the outstanding shares of Common Stock are, after
the Effective Date, recapitalized, converted into or exchanged for different
stock or securities of the Company, such other stock or securities.

 

“Company” means Care Capital Properties, Inc. a Delaware corporation, or any
successor thereto.

 

“Deferral Date” means the date Fees would otherwise have been paid to the
Participant.

 

“Deferral Election” means a written election to defer Fees under the Plan or an
election as to the form of distribution (but not an election as to the medium of
payment).

 

“Director” means any individual who is a member of the Board.

 

“Fair Market Value” of a share of Common Stock means, as of any applicable date,
the closing sale price of the Shares on the New York Stock Exchange or any
national or regional stock exchange in which the Shares are traded, or if no
such reported sale of the Shares shall have occurred on such date, on the next
preceding date on which there was such a reported sale. If there shall be any
material alternation in the present system of reporting sale prices of the
Shares, or if the Shares shall no longer be listed on the New York Stock
Exchange or a national or regional stock exchange, the fair market value of the
Shares as of a particular date shall be determined by such method as shall be
determined by the Committee.

 

“Fees” means all or part of any retainer or meeting fees payable in cash to a
Non-Employee Director in his or her capacity as a Director.  Fees shall not
include any expenses paid directly or through reimbursement.

 

“Non-Employee Director” means a Director who is not an employee of the Company
or any of its subsidiaries or affiliates.  For purposes of the Plan, an employee
is an individual whose

 

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wages are subject to withholding of federal income tax under Section 3401 of the
Internal Revenue Code of 1986, as amended.

 

“Participant” means a Non-Employee Director who defers Fees under Article 6 of
the Plan.

 

“Shares” means shares of Common Stock.

 

“Stock Units” means the credits to a Participant’s Stock Unit Account under
Article 6 of the Plan, each of which represents the right to receive one Share
upon settlement of the Stock Unit Account.

 

“Stock Unit Account” means the bookkeeping account established by the Company
pursuant to Section 6.5.

 

“Termination of Service” means “separation from service” pursuant to Code
Section 409A, as determined, and in accordance with the methodology selected, by
the Company, consistent with Code Section 409A.

 

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