Document:

Exhibit 10.51

American Retirement Corporation (the “Company”)

Summary of Director and Executive Officer Compensation

I.              DIRECTOR COMPENSATION.   Directors who are employees of, or paid consultants to, the Company do not receive additional
compensation for serving as directors of the Company. The following table sets forth current rates
of cash compensation for the Company’s non-employee directors.

	 

	Annual Retainer
	 	$16,000 (payable in quarterly installments)

	 	 	 
	Board Meeting Attendance Fee
	 	$1,000

	 	 	 
	Lead Director, Audit Committee

        Chair and Compensation 

        Committee Chair Annual Retainer
	 	$4,000

	 	 	 
	Audit Committee Member Meeting Attendance Fee
	 	$1,000

	 	 	 
	Committee Member Meeting Attendance 

        Fee (all other committees other

        than Audit Committee)
	 	$500

	 
	                In
addition to cash compensation, non-employee directors receive options to purchase shares of common
stock pursuant to the Company’s 1997 Stock Incentive Plan. On the date of each annual meeting
of the shareholders of the Company, each non-employee director who will continue as a director following
such meeting automatically receives an option to purchase 3,000 shares of common stock. Such options
vest with respect to all 3,000 shares on the date of the next annual meeting of shareholders. All
options automatically granted to a non-employee director enable the optionees to purchase shares
of common stock at the fair market value of the common stock on the date of grant. The terms of the
options are ten years from the date of grant. The exercise price may be paid in cash, shares of common
stock previously owned by the director, or a combination thereof.

II.            EXECUTIVE OFFICER COMPENSATION.
  The following table sets forth the current base salaries provided to the Company’s Chief Executive
Officer and four most highly compensated executive officers.

     

	

	Executive Officer
	 	Current Salary

	
		

	       	       	       
	W. E. Sheriff
	 	$ 363,000

	Gregory B. Richard
	 	$ 230,000

	H. Todd Kaestner
	 	$ 230,000

	George T. Hicks
	 	$ 230,000

	Bryan D. Richardson
	 	$ 225,000

	 
	                In
addition to their base salaries, the Company’s Chief Executive Officer and four most highly
compensated executive officers are also eligible to:

	 

		•	receive cash bonuses under the Company’s Officer’s Incentive Compensation Plan, a copy of
  which has been filed as Exhibit 10.8 to the Company’s Annual Report on Form 10-K for the fiscal
  year ended December 31, 2004; 

			 
		•	participate in the Company’s long-term incentive program, which currently involves the award of
  restricted stock and stock options pursuant to the Company’s 1997 Stock Incentive Plan; 

			 
		•	participate in the Company’s Deferred Compensation Plan and/or Supplemental Executive Retirement
  Plan; 

			 
		•	participate in the Company’s Associate Stock Purchase Plan; and 
			 
	 	•	participate in the Company’s broad-based benefit programs generally available to its salaried employees, including health, disability and life insurance programs and 401(k) Plan.Exhibit 10.52

AMERICAN RETIREMENT CORPORATION

NON-QUALIFIED STOCK OPTION AGREEMENT

                  THIS STOCK OPTION AGREEMENT is made and entered into this _____ day of _____________ ______, by and
between AMERICAN RETIREMENT CORPORATION, a Tennessee corporation (the “Company”), and _______________________
(the “Optionee”). Capitalized terms not otherwise defined herein shall have the meaning
ascribed to such terms in the American Retirement Corporation 1997 Stock Incentive Plan, as amended
(the “Plan”).

                 WHEREAS, the Company has adopted the Plan pursuant to which the Company is authorized to grant employees
of the Company options to purchase shares of the Company’s common stock, par value $.01 per
share (the “Common Stock”);

                 WHEREAS, the Company desires to afford the Optionee an opportunity to purchase Common Stock as hereinafter
provided in accordance with the provisions of the Plan.

                 NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound hereby, agree as follows:

                1.               Grant of Option.   The Company hereby grants to Optionee a Non-Qualified Stock Option (the “Option”), exercisable
in whole or in part, to purchase ______ shares of the Company’s Common Stock for an exercise
price of $________ per share (which equals the fair market value of the Common Stock on the date
of grant).

                2.               Option Plan.   The Option is granted under the Plan and is subject to the terms and conditions set forth in the
Plan. In the event any of the provisions hereof conflict with or are 

	

	inconsistent with the provisions of the Plan,
        the provisions of the Plan shall be controlling.

                    3.               Timing of Exercise.   Optionee may exercise the Option with respect to the percentage and number of shares set forth below from and after the dates specified below:

	Percentage Vested	Date of Vesting	Cumulative

    Options Exercisable    
	
	
	

	 	 	 
	 	 	 
	 	 	 

	

                 In the event of a Change in Control, the Option, to the extent not previously exercisable and vested,
will be exercisable and fully vested automatically. The Option will expire ten years from the date
of grant of the Option with respect to any then unexercised portion thereof, unless terminated earlier
pursuant to Section 6 below.

                4.               Manner of Exercise.   The Option shall be exercised by the Optionee (or other party entitled to exercise the Option under
Section 6 of this Agreement) by delivering written notice to the Company stating the number of shares
of Common Stock to be purchased, the person or persons in whose name the shares are to be registered
and each such person’s address and social security number. Such notice shall not be effective
unless accompanied by the full purchase price for all shares so purchased. The purchase price shall
be payable in cash (payment in currency or by certified check, cashier’s check, postal money
order or wire transfer shall be considered payment in cash), in the form of shares of Common Stock
already owned by the Optionee and held for at least six (6) months prior to the exercise date, or
such other method of payment as the Committee may accept. In the event of payment by shares of Common
Stock, the shares used in payment of the purchase price shall be considered payment to the extent
of their Fair Market 

	

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Value on the date of exercise of the Option. At the time of payment of the purchase price and prior
to delivery of any certificate for such shares, the Optionee shall pay to the Company in cash an
amount sufficient to satisfy any federal, state and local withholding or other tax requirements.

                5.               Nontransferability of Option.   The Option shall not be transferable by the Optionee without the prior written consent of the Committee
other than (i) transfers by the Optionee to a member of his or her Immediate Family (as that term
is defined in the Plan) or a trust for the benefit of the Optionee or a member of his or her Immediate
Family, or (ii) transfers by will or by the laws of descent and distribution. The terms of the Option
shall be binding on the executors, administrators, heirs and successors of the Optionee.

                6.               Termination of Employment.

                                  (a)            Termination by Death.   If the Optionee’s employment by the Company terminates by reason of death, the Option may thereafter
be exercised, to the extent the Option was exercisable at the time of death, by the legal representative
of the estate or by the legatee of the Optionee under the will of the Optionee, for a period of one
year from the date of such death or until the expiration of the stated term of the Option, whichever
period is the shorter.

                                  (b)           Termination by Reason of Retirement or Disability.   If the Optionee’s employment by the Company terminates by reason of Retirement or Disability,
the Option may thereafter be exercised by the Optionee, to the extent it was exercisable at the time
of termination, for a period of three years from the date of such termination of employment or until
the expiration of the stated term of the Option, whichever period is the shorter; provided, however,
that if the Optionee dies within the three year period specified above, any unexercised portion of
the Option shall thereafter be exercisable to the extent to which the Option was 

	

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exercisable at the time of death for a period of one year from the date of such death, or until the
expiration of the stated term of the Option, whichever period is shorter.

                                  (c)            Other Termination.   If the Optionee’s employment by the Company is voluntarily terminated, the Option shall thereupon
terminate immediately. If the Optionee’s employment in the Company is involuntarily terminated
for any reason other than death, Retirement or Disability, the Option shall thereupon terminate,
except that the Option may be exercised by the Optionee, to the extent otherwise then exercisable,
for the lesser of three months or the balance of the term of the Option if such termination is not
for Cause (as defined in the Plan).

                7.               Restrictions on Purchase and Sale of Shares.   The Company shall be obligated to sell or issue shares pursuant to the exercise of the Option only
in the event that the shares are at that time effectively registered or otherwise exempt from registration
under the Securities Act of 1933, as amended (the “1933 Act”). In the event that the shares
are not registered under the 1933 Act, the Optionee hereby agrees that, as a further condition to
the exercise of the Option, the Optionee (or his successor under Section 6 hereof), if the Company
so requests, will execute an agreement in form satisfactory to the Company in which the Optionee
represents that he or she is purchasing the shares for investment purposes, and not with a view to
resale or distribution. The Optionee further agrees that if the shares of Common Stock to be issued
upon the exercise of the Option are not subject to an effective registration statement filed with
the Securities and Exchange Commission pursuant to the requirements of the 1933 Act, such shares
shall bear an appropriate restrictive legend.

                8.               Adjustment.   In the event of any merger, reorganization, consolidation, 

	

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recapitalization, extraordinary cash dividend, stock dividend, stock split or other change in corporate
structure affecting the Common Stock, the number of shares of Common Stock of the Company subject
to the Option and the exercise price per share of such shares shall be adjusted appropriately by
the Committee.

                9.               No Rights Until Exercise.   The Optionee shall have no rights hereunder as a shareholder with respect to any shares subject to
the Option until the date of the issuance of a stock certificate to him or her for such shares upon
due exercise of the Option. Nothing contained herein shall create an obligation on the part of the
Company to repurchase any shares of Common Stock purchased hereunder.

                10.             Amendment. The Committee may amend the terms of the Option, prospectively or retroactively, but, subject to
Section 8 above, no such amendment shall impair the rights of the Optionee hereunder without the
Optionee’ s consent.

                11.             Notices.   All notices required to be given under the Option shall be deemed to be received if delivered or
mailed as provided for herein, to the parties at the following addresses, or to such other address
as either party may provide in writing from time to time.

	                 To the Company:	 
	 	 
	 	American Retirement Corporation
	 	111 Westwood Place, Suite 200
	 	Brentwood, TN 37027
	 	Attn:   Terry L. Frisby
	 	 
	                 To the Optionee:	 
	 	 
	 	——————————————————————————
	 	——————————————————————————
	 	——————————————————————————

	

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                IN WITNESS WHEREOF, the parties have caused this Stock Option Agreement to be duly executed as of the
day and year first above written.

	 
	 

	 	AMERICAN RETIREMENT CORPORATION

	 	 
	 	By:
	 	        ————————————————————————
	 	Title:
	 	            ———————————————————————
	 	 
	 	 
	 	 OPTIONEE:
	 	 
	 	 
	 	———————————————————————————

	

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