exv10w2



 






Exhibit 10.2




SUNRISE SENIOR LIVING, INC.

2003 STOCK OPTION AND RESTRICTED STOCK PLAN




RESTRICTED STOCK AGREEMENT




     Sunrise Senior Living, Inc., a Delaware corporation (the “Company”), hereby grants shares of
its common stock, $0.01 par value (the “Stock”), to the Grantee named below, subject to the vesting
conditions set forth in the attachment. Additional terms and conditions of the grant are set forth
in this cover sheet, in the attachment and in the Company’s 2003 Stock Option and Restricted Stock
Plan (the “Plan”).



Grant Date: ____May 10, 2005




Name of Grantee: Michael B. Lanahan




Number of Shares of Stock Covered by Grant: 18,500




Purchase Price per Share of Stock: $0.01




     By signing this cover sheet, you agree to all of the terms and conditions described in the
attached Agreement and in the Plan, a copy of which is available from the Company upon request.
You acknowledge that you have carefully reviewed the Plan, and agree that the Plan will control in
the event any provision of this Agreement should appear to be inconsistent.



	 	 	 
	Grantee:

	 	                          /s/ Michael B. Lanahan
	 

	 	 
	 

	 	Print
Name:           Michael B. Lanahan
	 
	 	 
	Company:

	 	                         /s/ Thomas B. Newell
	 

	 	 
	 

	 	Print Name:          Thomas B. Newell
	 

	 	Title:                     President





Attachment




This is not a stock certificate or a negotiable instrument.




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SUNRISE SENIOR LIVING, INC.

2003 STOCK OPTION AND RESTRICTED STOCK PLAN




RESTRICTED STOCK AGREEMENT




	 	 	 
	Restricted Stock/ Nontransferability

	 	This grant is an award of Stock in
the number of shares set forth on
the cover sheet, at the purchase
price set forth on the cover
sheet, and subject to the vesting
conditions described below (the
“Restricted Stock”). The purchase
price for the Restricted Stock is
deemed paid by your services to
the Company. To the extent not
yet vested, your Restricted Stock
may not be transferred, assigned,
pledged or hypothecated, whether
by operation of law or otherwise,
nor may the Restricted Stock be
made subject to execution,
attachment or similar process.
	 
	 	 
	Issuance and Vesting

	 	The Company will issue your
Restricted Stock in your name as
of the Grant Date. Your
Restricted Stock is being issued
in accordance with Section 3(b) of
your Employment Agreement dated
May 10, 2005 with the Company (the
“Employment Agreement”).
Capitalized terms used below in
this “Issuance and Vesting”
section but not defined in this
Restricted Stock Agreement or the
Plan will have the meanings given
to them in the Securities Purchase
Agreement dated as of May 2, 2005
by and among the Company,
Greystone Communities, Inc. and
you, among others (the “Purchase
Agreement”).
	 
	 	 
	 

	 	Your right to the Stock under this
Restricted Stock grant becomes
fully vested on the eighth
anniversary of the Grant Date if
you have been continuously
providing services to the Company
or a Subsidiary (either in your
current employment capacity or in
any subsequent full-time or
part-time employment capacity)
from the Grant Date until the
eighth anniversary of the Grant
Date; provided, however, that
vesting shall accelerate under the
following circumstances:
	 
	 	 
	 

	 	If either (A) the 2005 fiscal year
Pre-Tax Net Income of the Acquired
Companies is greater than $5.7
million and their 2006 fiscal year
Pre-Tax Net Income is greater than
$9.5 million, or (B) the Acquired
Companies’ cumulative Pre-Tax Net
Income for fiscal years 2005 and
2006 is greater than $15.2
million, then 12,333 shares of
Restricted Stock shall vest at the
time such Pre-Tax Net Income
amounts have been conclusively
determined in accordance with
Section 2.05(d) of the Purchase
Agreement.
	 
	 	 
	 

	 	If either (A) the 2007 fiscal year
Pre-Tax Net Income of the Acquired
Companies is greater than $11.3
million, or (B) the Acquired
Companies’ cumulative Pre-Tax Net
Income for fiscal






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	 	years 2005, 2006
and 2007 is greater than $26.5
million, then 6,167 shares of
Restricted Stock shall vest at the
time such Pre-Tax Net Income
amounts have been conclusively
determined in accordance with
Section 2.05(d) of the Purchase
Agreement.
	 
	 	 
	 

	 	Notwithstanding the foregoing, if
you are restricted from selling
Company stock on a vesting date
pursuant to the Company’s policy
on insider trading, your shares
that would have vested on that
date will vest on the first date
that is during a window period in
which Company insiders are not
restricted from selling Company
stock.
	 
	 	 
	 

	 	Notwithstanding the vesting
schedule, to the extent not
previously vested, your right to
the Stock under this Agreement
becomes 100% vested upon the
earliest of (i) your termination
of employment with the Company or
a Subsidiary due to your death or
disability, (ii) your termination
of employment by the Company or a
Subsidiary other than for Cause
(as defined in the Employment
Agreement), or (iii) termination
of employment by you for Good
Reason (as defined in the
Employment Agreement), in each
case if you have been continuously
employed by the Company or a
Subsidiary from the Grant Date.
For purposes of clause (ii) of the
foregoing sentence, with respect
to the period after the expiration
of the Original Term (as defined
in the Employment Agreement) and
before the eighth anniversary of
the Grant Date, your employment
with the Company or a Subsidiary
shall be deemed to have been
terminated by the Company or such
Subsidiary without Cause if (a)
your employment has not been
terminated by the Company or a
Subsidiary for Cause (as defined
in the Employment Agreement) and
(b) the Company or a Subsidiary
does not offer annually to extend
the Term (as defined in the
Employment Agreement) in one-year
increments, on the same terms and
conditions set forth in the
Employment Agreement, provided
that such offered terms may differ
from the terms of the Employment
Agreement by providing for no less
than (1) a minimum of 15 working
hours per week and (2) a prorated
salary which, when annualized
based on full time status, would
at least be equal to your highest
Salary (as defined in the
Employment Agreement) on an
annualized basis during the Term
of the Employment Agreement,
including any extensions of such
Employment Agreement.
	 
	 	 
	 

	 	No additional shares of Stock will
vest after you have ceased to be
employed by the Company or any
Subsidiary for any reason.
	 
	 	 
	Forfeiture of Unvested Stock

	 	In the event that your employment with the Company or a






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	 	Subsidiary
terminates, you shall forfeit all
of the shares of Stock subject to
this grant that have not yet
vested.
	 
	 	 
	Book Entry Restrictions

	 	The Restricted Stock will be
issued in book entry form. The
Company shall cause the transfer
agent for the shares of Common
Stock to make a book entry record
showing ownership for the shares
of Restricted Stock in your name
subject to the terms and
conditions of this Agreement. You
shall be issued an account
statement acknowledging your
ownership of the shares of
Restricted Stock.
	 
	 	 
	 

	 	The shares of Restricted Stock
subject to restrictions hereunder
shall be subject to the following
terms and conditions relating to
their release from restrictions or
their cancellation:






	 
	As your interest in the Restricted
Stock vests as described above,
your vested Stock shall be
released from restrictions and
delivered to you, at your request.

	 

	Should you forfeit any unvested
Restricted Stock held subject to
restrictions hereunder, then such
unvested Restricted Stock shall be
cancelled without payment, and you
shall have no further rights with
respect to such shares.







	 	 	 
	 

	 	You authorize the Company to issue
such instructions to the transfer
agent as the Company may deem
necessary or proper to comply with
the intent and purposes of this
Agreement. This paragraph shall
be deemed to constitute the stock
power contemplated by the Plan.
	 
	 	 
	Withholding Taxes

	 	You agree, as a condition of this
grant, that you will make
acceptable arrangements to pay any
withholding or other taxes that
may be due as a result of the
vesting of Stock acquired under
this grant. In the event that the
Company determines that any
federal, state, local or foreign
tax or withholding payment is
required relating to the vesting
of shares arising from this grant,
the Company shall have the right
to require such payments from you,
or withhold such amounts from
other payments due to you from the
Company or any Affiliate.
	 
	 	 
	Section 83(b) Election

	 	Under Section 83 of the Internal
Revenue Code of 1986, as amended
(the “Code”), the difference
between the purchase price paid
for the shares of Stock and their
fair market value on the date any
forfeiture restrictions applicable
to such shares lapse will be
reportable as ordinary income at
that time. For this purpose,
“forfeiture restrictions” include
the Company’s Repurchase Right as
to unvested Stock described above.
You






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	 	may elect to be taxed at the
time the shares in restricted form
are acquired rather than when such
shares cease to be subject to such
forfeiture restrictions by filing
an election under Section 83(b) of
the Code with the Internal Revenue
Service within thirty (30) days
after the Grant Date. You will
have to make a tax payment to the
extent the purchase price ($0.01
per share) is less than the fair
market value of the shares on the
Grant Date. The form for making
this election is attached as
Exhibit A hereto. Failure to make
this filing within the thirty (30)
day period will result in the
recognition of ordinary income by
you (in the event the fair market
value of the shares increases
after the date of purchase) as the
forfeiture restrictions lapse.
	 
	 	 
	 

	 	YOU ACKNOWLEDGE THAT IT IS YOUR
SOLE RESPONSIBILITY, AND NOT THE
COMPANY’S, TO FILE A TIMELY
ELECTION UNDER SECTION 83(b), EVEN
IF YOU REQUEST THE COMPANY OR ITS
REPRESENTATIVES TO MAKE THIS
FILING ON YOUR BEHALF. YOU ARE
RELYING SOLELY ON YOUR OWN
ADVISORS WITH RESPECT TO THE
DECISION AS TO WHETHER OR NOT TO
FILE ANY 83(b) ELECTION.
	 
	 	 
	Retention Rights

	 	This Agreement does not give you
the right to be retained by the
Company in any capacity. Subject
to the terms of the Employment
Agreement, the Company reserves
the right to terminate your
service with the Company at any
time and for any reason.
	 
	 	 
	Shareholder Rights

	 	You shall have the right to vote
the Restricted Stock and, subject
to the provisions of this
Agreement, to receive any
dividends declared or paid on such
stock. Any distributions you
receive as a result of any stock
split, stock dividend, combination
of shares or other similar
transaction shall be deemed to be
a part of the Restricted Stock and
subject to the same conditions and
restrictions applicable thereto.
The Company may in its sole
discretion require any dividends
paid on the Restricted Stock to be
reinvested in shares of Stock,
which the Company may in its sole
discretion deem to be a part of
the shares of Restricted Stock and
subject to the same conditions and
restrictions applicable thereto.
Except as described in the Plan,
no adjustments are made for
dividends or other rights if the
applicable record date occurs
before your stock certificate is
issued.
	 
	 	 
	Adjustments

	 	In the event of a stock split, a
stock dividend or a similar change
in the Stock, the number of shares
covered by this grant may be






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	 	adjusted (and rounded down to the
nearest whole number) pursuant to
the Plan. Your Restricted Stock
shall be subject to the terms of
the agreement of merger,
liquidation or reorganization in
the event the Company is subject
to such corporate activity.
	 
	 	 
	Applicable Law

	 	This Agreement will be interpreted
and enforced under the laws of the
State of Delaware, other than any
conflicts or choice of law rule or
principle that might otherwise
refer construction or
interpretation of this Agreement
to the substantive law of another
jurisdiction.
	 
	 	 
	The Plan

	 	The text of the Plan is
incorporated in this Agreement by
reference. Certain capitalized
terms used in this Agreement are
defined in the Plan, and have the
meaning set forth in the Plan.
	 
	 	 
	 

	 	This Agreement and the Plan
constitute the entire
understanding between you and the
Company regarding this grant of
Restricted Stock. Any prior
agreements, commitments or
negotiations concerning this grant
are superseded.






     By signing the cover sheet of this Agreement, you agree to all of the terms and conditions
described above and in the Plan.




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EXHIBIT A




ELECTION UNDER SECTION 83(b) OF

THE INTERNAL REVENUE CODE




     The undersigned hereby makes an election pursuant to Section 83(b) of the Internal
Revenue Code with respect to the property described below and supplies the following information in
accordance with the regulations promulgated thereunder:




	1.	 	The name, address and social security number of the undersigned:





	 	 	 	 	 
	Name:

	 	 	 	 
	 

	 	 	 	 
	 
	Address:
	 	 	 	 
	 

	 	 	 	 
	 
	 
	 	 	 	 
	 

	 	 	 	 
	 
	Social Security No.:
	 	 	 	 
	 

	 	 	 	 






	2.	 	Description of property with respect to which the election is being made:






                    shares of common stock, par value $0.01 per share, of Sunrise Senior Living, Inc., a
Delaware corporation (the “Company”).




	3.	 	The date on which the property was transferred is: ______, 200___.
	 
	4.	 	The taxable year to which this election relates is calendar year: 200___.
	 
	5.	 	Nature of restrictions to which the property is subject:





The shares of stock are subject to the provisions of a Restricted Stock Agreement between the
undersigned and the Company. The shares of stock are subject to forfeiture under the terms of
the Agreement.




	6.	 	The fair market value of the property at the time of transfer (determined without regard to
any lapse restriction) was: $___ per share, for a total of $___.
	 
	7.	 	The amount paid by taxpayer for the property was: $___.
	 
	8.	 	A copy of this statement has been furnished to the Company.





Dated: _____________, 200___




	 	 	 
	 
	Print Name:
	 	 
	 

	 	 





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PROCEDURES FOR MAKING ELECTION

UNDER INTERNAL REVENUE CODE SECTION 83(b)




     The following procedures must be followed with respect to the attached form for making an
election under Internal Revenue Code section 83(b) in order for the election to be effective:



          1. You must file one copy of the completed election form with the IRS Service Center where you
file your federal income tax returns within thirty (30) days after the Grant Date of your
Restricted Stock.




          2. At the same time you file the election form with the IRS, you must also give a copy of the
election form to the Stock Plan Administrator of the Company.




          3. You must file another copy of the election form with your federal income tax return
(generally, Form 1040) for the taxable year in which the stock is transferred to you.





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